When a business is valued they use a certain formula

Pre-Tax Profit + Owner's Salary + Additional Owner Perks
+ Interest + Depreciation less Allocation for Capital Expenditures multiplied by 1-3


So if this site is making 10K profit a month, then I suppose he has put that figure on it base upon his 10K monthly profit multiplied by 1.67, if he can prove those profits, then it is a reasonable figure to ask.

However I would make sure you see his actual business accounts, his P&L sheets and stuff, rather than going on web site statistics.

I say that because it is easy to make a website look very profitable in stats, and by showing screenshots of paypal accounts and stuff, such things ar also very easily tampered with and I would wonder if it is doing so well, why would he sell it.

If it is a viable business opportunity he will have proper accounts, i would make sure it is them you use to gauge the viability, dont go on screenshots of things.

Also how have you checked whether his website traffic is organic? In a websites stats it looks the same whether traffic has come from ppc or organically, again the only way to truly gauge this is to see a companies proper business accounts, where expenses for advertising etc are all listed.

It is an awful lot of money to spend, worth it if it is genuine, but I am sceptical of websites for sale that claim to make loads of money, as if they do, why would they be for sale.

Would you be able to tell the website in question?

A website is just an assett of a business, so make sure that the business is doing as is claimed, as a website can be made to look like it is doing all sorts of things.

(ps- I got stung when I first became interested in websites some years back, paying $800 for a website that ended up I just got a duplicate site that obviously was worth zilch)