My company has an online software as a service product that is subscription based (yearly) and when first launched, 3-years ago, has been more than doubling in revenue each year (in 2009, $2K, and in 2010, 5.9K). Expenses are low - really only hosting fees, which is about $600/year and advertising maybe another $500. This year I'm on track to make about 10K. Customer retention is pretty high, since the software stores the customer's data (I would estimate about 80% retention). Support is minimal and done part-time by me.
I'm interested in selling the product, which would include current customers. How would you value the product for sale? One might ask, why am I selling it? Well, I work full-time, and as my customer base grows, I may need to spend more time and effort catering to them. Are there licensing options where I wouldn't have support obligations but get royalty? What would you ask for the royalty?
I would love to hear your insights...