Entrepreneurs-Journey.com Down-To-Earth Advice For Bloggers and Internet Marketers

I had a meeting with a friend and his business partner last week. The request was to “pick my brain” on the best way to move forward to generate some passive income streams online.

These two particular people are like a lot of people I know. They’ve got tech skills, they know the Internet well and they have lots of ideas for cool Internet business applications and websites.

Unfortunately they’ve managed to dig themselves into a situation where they spend all their time working on client jobs, running what you might call a “consulting” tech firm, completing various programming and web development projects for other people’s businesses. The money in this business model can be good, but it has some serious downsides too, namely -

• You have to deal with clients, usually one-on-one, a very low leverage interaction and often just painful as you have to work you way through lots of annoying clients to find the good ones
• You work very long hours, which my two friends could certainly testament to
• You know a lot about a lot, yet have difficulty specializing in anything
• You’re in competition with every other jack-of-all trades web development firm out there, which means you unfortunately end up competing on price, and it’s certainly not nice to have to undercut yourself simply to work with bad clients

Those points aren’t necessarily true across the board, but I’m pretty sure any person who has ever consulted or done any kind of web development work for clients will know what I’m talking about.

My friends are smart enough to realize the path they are on is not going to lead them to where they want to go, so they’re looking to make some changes.

The goal is to develop some form of income stream, or several, that could replace the need to take on client work. As always, the relationship between time, money and freedom of choice is heavily integrated here, as my friends are looking to make more money without drastically increasing their workload and eventually freeing up their time so they can do what they want to, rather than what they have to.

Let’s Not Be Strict About Passive Definitions

I’m about to reveal what I talked about during our meeting with my two friends. In terms of what I suggest you do if you are looking to make some passive income online, I don’t want people to get too caught up on the idea of “pure” passive income.

The methods I’m about to talk about are not pure passive income sources, however they have the potential to be low work, high return income sources that can potentially become very close to pure passive longer term. The fact is, it takes time to develop these income streams, but we all love the phrase passive income so I’ve decided to use it here in the title of my post.

So to clarify, what we are looking to do is start up completely new projects that have the potential to become good sources of near-passive and possibly pure passive income, it just might take some time to get there.

First, Understand Your Unique Opportunities

One of the first things I discussed with my friends was taking their present situation and turning it into something that’s less work for them. Sometimes the “lowest hanging fruit” is just a simple adjustment to the business model you are following now, transforming your core skill from labor intensive, to hands-off delivery, or at least much less work.

Here’s some examples of how you might do this -

Read the rest of this entry >>

Many years ago I wrote a blog post that looked at the reality of how much money you actually make when you run your own business.

You can read the article here – Do You Want to Run Your Own Business? Read this First!

My premise back then was that most business owners don’t make a whole lot of money until they sell their business.

This situation is very similar to what an employee, who stays with the one company for many years, goes through. A business owner can make a salary level income year after year, and then one day, likely at retirement age, the business is sold and a nice lump sum of cash is returned, much like a superannuation or retirement settlement an employee receives at the end of a long career.

Obviously this situation isn’t ideal if you are an entrepreneur looking to create freedom in your life, both time and financial freedom. If you spend all day, possibly beyond normal working hours, in your business, and you’re taking home an income pretty much equivalent to a salary (plus you have many more responsibilities than an employee), you are not in a great situation.

Turning Cash Into Assets

If I look back over the last five years of my business life, there have been a handful of significant “spikes” in my income.

The spikes have occurred because of either of these events -

Read the rest of this entry >>

I remember my first website sale. I made $13,000 Australian dollars selling a website that I had built from scratch myself. That sale was a big windfall for me and a moment I won’t forget because it was the first time I saw the real potential of online property investment.

Since that sale I’ve gone on to sell more than $150,000 USD in websites. Some of the sites I built myself, investing my own time and sometimes money, while others I have purchased and then sold for a profit at a later date.

I’ve never lost money on a website investment, although I have bought some sites that were not big money spinners – I got out with pretty much the same as I went in with. When profits are made though, the worst I have done is double my money.

Long Term Investing?

On the Internet you might call what I do long term investing since most of the sites I bought were sold no earlier than 18 months time. The websites I built myself take as long as five years to reach the point of sale, although I could have sold earlier for less or held on longer for more.

The best return on investment from a flip (a site bought and later sold) was 1,000% – 10 times the money I put in. It took a little over two years to do that. Another trade was a set of sites I purchased 18 months prior that brought in a little over double my initial investment.

In the offline world, returns like that in 18 and 24 months would be considered exceptional and certainly not standard. If a share portfolio or investment in physical property returns 20% a year you are doing well.

The world of the web is different. Everything is changing fast, yet with so many websites and so many people online, the size and potential of the market is tremendous. There are bargains out there all the time and as long as you don’t screw up what you purchase, simply allowing a site to grow organically can result in significant profits, if you are prepared to wait.

Flipping Part Time

I’ve never focused all my energy on buying and selling websites, which is why I haven’t done that many trades. Most of the time I work on whatever my main business projects are at the time, but I keep my eyes on some of the website trading forums to see if bargains come up.

When a site matches my criteria, I act fast with an offer, do some basic due diligence and if all things go well, make a deal. I miss out on more sites than I purchase because other people out-bid me, the site sells before I find it or due diligence convinces me to pass on a particular site.

As a result of buying websites purely as a side project, I’ve focused on a certain type of website and made sure I have people working with me who can help with the activities I don’t have the time to do. You definitely need to be careful if you want website flipping to be a part time job, it can quickly suck all your time, especially if you choose the wrong type of site.

Criteria for Part Time Website Flipping

Here’s some advice from what I have learned in the previous years flipping websites part time.

Read the rest of this entry >>

You might remember a month or so back I posted about some websites I had for sale. One of the sites was my other blog, Small Business Branding.

I am pleased to announce that Vera Raposo has taken over Small Business Branding and will endeavor to continue to grow the site from where I left off.

I’d like to thank Rob Kingston and the great team of writers who kept Small Business Branding going and will continue to write for the site and no doubt take it to new heights. I wish Vera best of luck with the blog.

Vera has posted a brief introduction and I encourage you to say hello and welcome her.

Sponsorship Opportunities

With the change of ownership some new sponsorship opportunities have arisen at Small Business Branding, so if you would like to reach the small business marketplace, visit the advertise page for details.

A Blog Flipping Story

As long term readers of my blog might recall, back in December 2005 I purchased Small Business Branding from Michael Pollock, who created the site and sold it to me to go build his now very successful blog theme design business, SoloStream.

That sale was one of the first publicly announced blog deals between two well known bloggers and it generated quite a bit of buzz at the time. Micheal and I recorded a two part podcast about the deal, which is still interesting listening if you like the topic of buying and selling websites.

After taking over the blog I quickly came to realize that I could not write to two very similar blogs by myself and began a unique experiment into outsourcing blog content creation. Small Business Branding become a magazine style publication with a roster of authors. In February 2007 I published an article – How To Outsource Your Blogging – A Case Study – that detailed how to replicate my system for blog content outsourcing.

Return On Investment

When I purchased Small Business Branding it was a well known blog with good search engine rankings for some popular small business terms and about 400 daily RSS readers. Michael hadn’t focused on monetization so the site was only making about $100 to $200 a month, mostly from AdSense.

Just over two years later, when I sold the site to Vera, it had grown to 2500 daily RSS readers and around $1500 a month in revenue. The income growth came mainly by increasing the monetization techniques applied, with a big chunk coming from adding banners and text links and selling the ad inventory directly to sponsors for a monthly fee. This was obviously helped along by the steady traffic growth thanks to the team of content producers.

I’m not at liberty to disclose how much I sold the site for, but I was happy with the return I made and compared to what I paid for it, I did very well. However you have to take into account how different the after-market for blogs is today compared to what it was when I bought the site.

Michael and I were pioneers in the industry of blog flipping, which today is a much more mature market, with hundreds of deals made every week. People pay more for blogs now because there are more interested buyers and thus competition raises prices. It’s seen as a good investment to buy a blog, with hundreds of case studies demonstrating this. In 2005 the idea of blogging for money was just gaining traction and wasn’t widespread.

As an acquisition and flip go, this deal was very good and my return was well over ten fold. This doesn’t include the income generated while owning the site and I have no doubt as long as Vera continues to grow the blog her earnings will surpass mine. Blogs can be great cash cows and capital investments, if you look after them.

More Sites For Sale

I still have a collection of two forums and a video site focused on the niche of mini bikes for sale, which generate about $1200 a month in almost passive income (you just have to invoice advertisers). I’ve got a PDF document that breaks down the details, so if you are interested, please email yaroATblogmastermind.com and I will send you the info.

Please note I’m looking for around 20 times revenue for these sites (as a group), so do not approach if you cannot entertain this price range.

In case you are wondering why I am selling these sites it is because I am divesting my self of assets not aligned with my core business focus, which is my blog training programs and information products. While these sites are great income sources, they do require mindshare to look after and grow and I intend to use my mind to focus on my main business interest.

In 2008 I am streamlining and simplifying my business. Part of this process involves divesting myself from projects not directly related to my core business.

What that means is I have some websites for sale – and some pretty darn good ones!

I won’t reveal the specific details in this blog post but I do have a PDF report that explains everything that I am happy to provide to serious buyers only.

The portfolio includes five websites, all of which require minimal ongoing work to maintain. It takes about five hours a week to look after them if you do it yourself, but my helper Rob, who manages these sites for me, can do it for you for a small monthly fee as he has done for me, so these sites can be run without you – pure passive income – though you still need to invest some time now and then and think about the future too.

You could invest more time to grow the income, which is what I haven’t been able to do due to my blogging projects and why I am selling these sites.

The sites currently generate over $3,000 per month in total and have made as much as $4,000 in a single month, but have never dropped below $3,000 since I have owned them. Running costs are about $100 per month for servers and $100 per YEAR for domain renewal.

The traffic to the sites totals well over 100,000 uniques per month and over 500,000 page impressions according to Google Analytics. You can almost double those numbers if you look at the stats from AWstats or Webalizer.

Included in the package are three forums, one blog and one video site. I prefer to sell them all to the one buyer if possible, however if that does not eventuate I will sell them individually or in smaller groups.

At this stage I am taking offers from serious buyers only. Since these sites require little ongoing maintenance to operate, produce a stable revenue and demonstrate serious growth potential, I expect a minimum of 15-20 times monthly revenue as a sale price. If you can entertain a price in that range, please email me and I will provide the PDF report with more details about the sites.

Please email your interest to yaroATblogmastermindDOTcom

If these sites do not sell this way, I will take them to auction at Sitepoint, so express your interest now to avoid competition.

Yaro