Podcast 37: Buying Sites for Cashflow, Authority Site Strategies, and June Income Report

Podcast 37: Buying Sites for Cashflow, Authority Site Strategies, and June Income Report

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Perrin and I were able to sit down yesterday and record episode 37 of the Niche Pursuits Podcast.  In the podcast, Perrin and I review the income report from last month, discuss the business potential of buying and selling websites, and then go into more depth in our new authority site project.

While we do cover similar topics to my last blog post, we also have a chance to dive quite a bit deeper and throw in a few other interesting topics as well.  Overall, if want our most up to date thoughts on buying and selling websites, building out niche sites, building large authority sites, and more, then I hope you'll give it a listen.

Here is what we cover in the podcast:

  • Review the income and traffic for the Adsense niche site that I purchased.
  • Review the income and traffic for the Pinterest site that I purchased.
  • The business model of buying sites and keeping the cashflow; or selling for a profit.
  • We compare the cost of building a site from scratch vs. buying a site making $1,000 per month.
  • I want to buy more websites!  If you have a website that is making $1,000 or more, please contact me.
  • We go into great details about our new authority site project.  Why are we doing it and how are we doing it?
  • We mention the interview I did with Hayden Miyamoto last week.
  • Similarities and differences of Small niche sites vs. large authority sites.
  • Keyword research and content strategies for our new authority site
  • Link building strategies for authority sites
  • I just finished reading a great book: Quiet: The Power of Introverts in a World That Can't Stop Talking
  • Perrin is currently reading an enjoyable book: Early Retirement Extreme: A Philosophical and Practical Guide to Financial Independence. A website with similar philosophies as that book is: MrMoneyMustache.com

More Detailed Notes of What is Covered

As mentioned briefly in my last post, I bought a site a little over a month ago, and it earned $2300 during June (the first full month I owned it).  I bought it for a great price at a great multiple and am enjoying the cash flow right now.

This is a similar model to buying and renting out homes in a way.  Perrin and I discuss how buying and holding these sites for the cash flow really can be a great way to go.  The percentage of income you gain for the purchase price of sites is significantly greater than the income you get from buying and renting out homes.

Obviously the risk is greater with website because of how variable the traffic and earnings can be.  And a website's value can go to zero overnight (worst case scenario), while a home will always have some value because its real property.  However, just like real estate; a lot of the money can be made when you purchase.  So, look to buy sites at lower multiples, especially if you are looking to flip it quickly.

If you are looking to hold onto a site for its cashflow, and are just looking to build cashflow; then perhaps the multiple you purchase at is not as critical (although you always want a great deal).

In the second half of the podcast, Perrin and I dive into more details about our new plans for a large authority site.

A big reason why we have decided to start building out a larger site is a resource and money decision.  Perrin is extremely busy working on a dozen or so niche sites.  He can only spend a little bit of time on each site, and we can only invest so much money of our monthly pie on each of those sites.  As a result, none of those sites are going to become huge properties relatively quickly.

In addition, Google has changed the game a bit.  As mentioned earlier this week, with all the updates that Google has made its more difficult to get a small website ranking…quickly.

So, we are taking the same long tail keyword strategies, and simply targeting thousands of long tail keywords on one website in one market.  So, the keyword strategy is still the same.  We are looking for low competition keywords in our particular niche (which is very broad), and will be writing original articles on all of these topics.

We dive into some of the similarities and differences of small niche sites vs. our new authority site plan.

Overall, I hope you enjoy the discussion that Perrin and I have surrounding the topics of buying and selling websites and the strategy for our new authority site project.  Be sure to stay tuned, as we will be covering our new site more and more as we build it out and start getting results.

If you enjoy the podcast, please stop by iTunes here and leave a rating or review.

Listen to Episode 37 Here

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52 Comments for this Post

  1. andrew

    andrew

    cracking up with calculator music. Very funny beginning of your podcast

  2. TJ

    TJ

    Perfect timing, I was looking forward to your next podcast!

  3. cornell

    cornell

    Ha! Love the music while trying to use the calculator!!

  4. Sachin

    Sachin

    Awesome earning Spencer!

    I think the business model you are following since last couple of years is the way to go for every person who want to build a nice RESIDUAL income!

    And yes selling websites seems to be a lucrative business now.

  5. Tobias

    Tobias

    Hi Spencer.
    Great podcast once again! You are definitely taking the right direction building a larger site. I am in the process of building a larger site myself for many of the same reasons. What I am struggling with is the site setup and structure. I guess most your readers know how to build those 10-15 page Amazon sites and you’ve explained it before but could you maybe go a little into details of how to setup a site with 100+ pages? I only use pages in wordpress, no posts. Any suggestions on how to set up the internal linking structure and categories?

    Thanks a lot!

    • Lennart

      Lennart

      Yes this is certainly interesting to know! Structure of internal linking but also how would you set up the menus?
      Something like for each category its own custom menu or so? Is that possible at all?

      • Spencer Haws

        Spencer Haws

        Sure, you can set up any custom menu that you want…I have lots of custom menus here on NichePursuits.com (for example)…such as my case studies page, and more. It really doesn’t have to be very complex, just think through what major categories you want to cover in your site, and make it a category and perhaps a menu. (Not all your categories will be menus necessarily).

    • Spencer Haws

      Spencer Haws

      I may have to do an entire post, as its an interesting topic. You should also realize that NichePursuits.com has over 300 posts on it, so you can see how I have this site structured for a good idea. But the key is to just have well thought out (logical) categories and sub categories, and then interlink liberally within the same category/sub-category. You can do the same using pages and subpages (instead of categories).

  6. Masks_Leo

    Masks_Leo

    Enjoyed the podcast this week which led a question:

    Is more content ever a bad thing? Is time/money the only thing limiting you to putting up the 1 long and 3 short articles each day?

    Thanks in advance for the answer and looking forward to hearing about the authority site.

    -Leo

    • Spencer Haws

      Spencer Haws

      As long as the content is quality and original, then no, I don’t think more is ever a bad thing. Yes, time and money is limiting us from doing more articles.

  7. Lo

    Lo

    Where do you buy all your websites? Is it always just Flippa? I’ve been trying to buy a smaller site, but they all the Flippa listings look terrible.

    Would love to see a post / case study on how you buy a site.

    Thanks Spencer and Perrin!

    • Spencer Haws

      Spencer Haws

      I purchased 1 through Flippa (the pinterest site), and 2 through private deals via email. The private deals were from readers of nichepursuits that contacted me.

  8. Fredrik

    Fredrik

    Great podcast, guys.

    I understand your shift from small niche sites to larger authority sites as to optimizing your costs and time and to minimizing the risk that Google will penalize your site, thus maximizing your returns over time.

    Now, one thing I’ve been wondering is whether this strategy would be good in any market (e.g. non-English speaking markets or non-US markets), if you know what I mean.

    The global/US market is so saturated that is understandable to make this shift, but I keep asking myself if it’s the right move if you were in a less competitive market..?

    Thanks Spencer, and keep it up!

    – Fredrik

    • Spencer Haws

      Spencer Haws

      Yes, I think its still a good move.

  9. Seolution

    Seolution

    Hi Spencer,

    I’ve got a question for you, let’s say that you create a new site, and write 20 blog posts, what do you think it’s better on seo purposes, publish all of them at once, or publish one per week?

    • Spencer Haws

      Spencer Haws

      I like to drip feed the articles over time. But I usually get 10 or so up pretty quickly (maybe 1 per day?)…then you can slow down or develop a more regular schedule.

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  11. Anurag

    Anurag

    Hi Spencer,
    I didn’t know you can earn that much with buying and selling sites. This is called domain flipping . Right?
    And your income, that’s really good, if I am able to earn half of that I would get happy.
    Thanks for this awesome share.
    Regards,
    Anurag

  12. Kent

    Kent

    Spencer, this is way to go. I agree that Authority site is worthy to focus and have much bigger income potential.

    Your original plan to have $500 x 10 = $5k/mo on new niche sites.. why not to have 1 huge site making $5k or even $10K/mo. 🙂

    I’m interested in knowing how you setup your Silo pages. Would be a nice long helpful blog post idea. Thanks!

    Ken

  13. Paul

    Paul

    Hi Spencer,

    Great and helpful advice!

    I am building my first “real” niche website and it already covers 80+ pages. And I do like to grow it to an authority site in the future.

    – The site was established as an EMD one year ago. Do you think this might be an issue in growing it to a real authority site.
    – My main traffic pages each consist of about 1000 to 1500 words. There are a lot of related longtail phrases that I didn’t cover yet.
    1) How to make the choice between adding related longtail phrases to an an established page if compared to writing new pages for each related longtail phrase?
    2) For content freshness and more “ranking power”, would it be a good idea to update (let’s say the main 5 – 10 pages) to a newer version with 2500+ words?

    Thanks and keep up the good work!
    Paul

    • Spencer Haws

      Spencer Haws

      Best of luck, Paul! You are probably okay with the EMD; you can always change the domain and 301 at anytime if you change your mind though.
      1. I usually create new pages/posts. But if you have some stats to back up your reasoning for adding to an existing page, then go for it.
      2. Maybe so. Really depends.

  14. Lenny

    Lenny

    Hi Spencer

    Very interesting podcast.

    Regarding content and structure on an Authority Site (100+ articles) I’m wondering what may be the best approach for a homepage.

    I feel it may be better to have a more general ‘welcome’ stye homepage giving directions to various items on the site, rather than a static article that targets a keyword.

    Any thoughts on this ?

    For example, with apennyhaved the plan was a smaller niche site with the homepage targeting a keyword.

    As Perrins site is gradually approaching Authority status do you think it may be better to have a more general homepage than a specific article?

    I’m planning on following your advice in starting small with a site, a brandable domain, build, and if successful build out more and more, so am thinking it may be better to future proof the site rather than having to go back at some point and change the hompepage.

    Although saying all that I know its probably not much hassle really.

    Thanks

    Lenny

  15. newbesttop10

    newbesttop10

    The post is very inspire and motivate new blogger as me. You site is seem to be my online library that i read every night. Hope I can get some success as 10% from u then it is my most success story for me ever.

  16. Patrick M Matherne

    Patrick M Matherne

    Hi,
    I have a weird situation. Since my website is about giving daily questions for people to practice on I was putting out an article a day of only about 300 words or less (and that was a stretch at times).
    When I look at my metrics I am not getting a lot of visitors but each visitor might go through 3 to 6 or so pages
    How should I try targeting keywords or should I let google try and pick up the natural keywords.

    • Spencer Haws

      Spencer Haws

      You might try writing more in-depth articles on related keywords (use Long Tail Pro to find keyword ideas). Then you can get more google traffic hopefully from these keywords (in-addition to your daily articles).

      • newbesttop10

        newbesttop10

        Dear Spencer Haws,
        I know that In-depth articles on related keywords is best for google ranking but it is not easy to write this kind of article.
        For me as new blogger and not yet have even adsense account How we can spend less with more productive in making articles ?

        • Sumnimytury

          Sumnimytury

          Very funny at the beginning 😀 However, the option of buying website is really great!

  17. Nigel

    Nigel

    Hi Spencer,
    Love your podcast.

    Nigel

  18. Michael

    Michael

    Hi spencer, any idea when you want to present the topic of your authority site?

  19. Matt

    Matt

    Hi Spencer and Perrin, I don’t know if this is too in-depth of a question, but, when you two say you’re working on an authority site together, have y’all officially set up an LLC with each person owning 50% of the entity (and profits) or is it more of an unofficial handshake agreement where the sole owner pays half the profits to the other?

    I ask because I’m thinking of partnering with a friend on a niche site or two and need some direction on how to set that up properly. Right now, because of the cost of setting up an LLC, we are on the business plan of “two dudes owning a website.” Thanks!

    • Spencer Haws

      Spencer Haws

      Matt, I already have a couple of different LLCs. Most of my websites operate under one LLC. So, when I say “we”; I’m still 100% owner…and Perrin is my employee. However, informally, we have agreed that when the site reaches a certain level, Perrin will earn a % of the profits. Hope that helps.

      • Matt

        Matt

        It does, thanks! And in general this has been a fantastic case study to follow, thanks for all your effort and transparency.

  20. Alex

    Alex

    Hey Spencer, when buying websites and after doing your due diligence on the analytics and you found out that the keyword that website is trying to rank for does not meet your criterias for doing keyword research, do you still buy it or you skip ahead?

    My plan after buying a website in adding content would be to go try and rank the website for other longer tail keywords and adding a better content for the main keyword, like adding videos and better pictures. Does it sound plausible?

    Anyway, there’s a lot of very good information here, thanks for sharing it to us.

    • Spencer Haws

      Spencer Haws

      Alex,
      It all depends. I may still buy a site that doesn’t rank for any great keywords (like I did for my Pinterest site)…you definitely want to look at the upside potential. Having said that, its always great to see that a site is ranking for at least 1 or 2 great keywords. And yes, your plain is feasible.

      • Alex

        Alex

        Thanks for the feedback!

  21. Daniele

    Daniele

    Hi Spencer and Perrin,

    I’ve been active for the last 2.5 years in the website buying/selling arena.
    Few months ago I also considered to move to the next step and buy bigger properties, in the 20-50K range, but it turned out not to be that straightforward for two main reasons:
    – they do have higher quality but sell for a considerably higher price;
    – they have enough cash-flow to be already optimized in many aspects.

    Now I’m stepping back looking for small properties as I think they are easier to make more profitable, increasing the ROI, and not too risky.

    I wonder how your experience is so far and if you’re coming to the same conclusions 🙂

    Thanks!

    • Spencer Haws

      Spencer Haws

      So far I’m very happy with the bigger purchase. Because I got it a great multiple; and its earns more per month…my profit will be much greater overall than if I purchased a smaller site…even if I don’t increase its earnings at all.

      • Daniele

        Daniele

        It sounds wonderful! Can you share the multiple?

  22. Daniele

    Daniele

    Hey Perrin,

    I read the same book a couple of years ago and I liked it.
    It’s extreme (well, that’s stated in the title already haha) and some ways to save money are not for everyone, but anyway the principles are valid and the math is an eyes opener.

    I also recommend to have a look at the author blog and forum.

    Ciao!

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  24. Derek Smith

    Derek Smith

    Hi Spencer,

    What do you think the best niches are when looking for “high paying” affilliate? Also, do you look to go straight to the source for an affilliate or use something like Amazon or CJ?

    • Spencer Haws

      Spencer Haws

      Do some searching around online for industries that spend the most money in online advertising. That will lead you to the high paying niches and affiliates. I usually go through an affiliate network (like CJ, etc). But if you can get a deal directly…even better.

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  27. Higgins

    Higgins

    Hi Spencer, after listening to the podcast with Hayden i made plans for a bigger siloid site as well, the fact that you and Perrin are doing the same is awesome cause it seems like you’re going to make it a casestudy for all of us as well,… or at least your sharing your thought on it. I would love to see an in depth post or podcast on structuring and siloing “niches” in such a site. Currently i’m struggling with the following issue,

    The silo pages i have do not contain a keyword i necessarily want to rank for, they are simply there to establish the niche/silo i am ging into at that point. On those silo pages you will only find links with some pictures that take you to the pages in that niche that i do want to rank for. There is virtually no content on them, The question is,… Is that bad ? and when building backlinks to my silos, should i point them to those ëmpty silo pages or to the pages within that silo that contain my keywords? Same thing could be said about my homepage btw, virtually no content, Just a bunch of pictures that represent my silo’s and take you there if you click on them.

  28. Drone blogger

    Drone blogger

    I hear you on the difficulty of getting a small site ranked quickly. I’ve got one successful blog (~700 last month) that’s ~6 months old, but my current blog is much newer and isn’t pulling income yet. It’s funny to start all over and realize that the “head start” of a developed site doesn’t apply when trying to rank a brand new one.

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