Today you’ll get a glimpse of our master strategy on buying websites for profit.
This is the same strategy that we used to sell two websites for a $190,000 profit (bought 12 months before for $45,000).
It’s also how our elite students, which you’ll learn below, turned a $20,000 website into $13,000 per month in semi-passive investment income.
And it’s what all our students use in the Digital Investors Program.
Watch the video below to understand our master strategy.
Then go out and start buying websites for profit.
Follow our Master Strategy Steps for Buying Websites for Profit and start making Cashflow Online
Matt Raad: Hi again everyone. Today we’re going to have a glimpse of our master strategy of how we buy websites for profit. Now, this is the same strategy that we use ourselves, and that all our students use, and it’s what we teach in our program Digital Investors.
We want to show you how we buy passive websites (or as passive as possible) and how to stay safe. We start everyone out, especially if you’re a total beginner, with small little baby steps and work through to building bigger sites. This way, you can get that cashflow and maybe retire, work from home, or quit your job.
Liz Raad: Yes, whatever your goal is. So, let’s have a look at our master strategy and how we go into the marketplace, because it is a little bit different than a lot of people may think.
Whenever we buy a website, we’re very clear about why we’re buying a particular website, what we want it to do and how it fits with our big picture goals.
For a lot of the people who join us, that first steppingstone to freedom is cashflow. They want the cashflow. As an end goal, you want long-term assets that are going to be worth a lot. So, they could sell-out for a big lump sum later on when they wanted too. But initially for most people it’s cashflow. So, let’s have a look at the strategy and how this works for cashflow.
Master Strategy Step #1 – Buy Smart – Look for Simple Website Assets You Can Add Value To
Liz: Step number one of our master strategy is buying smart. And part of that is going in with the idea of, “Why am I buying this website? How does it fit with my overall strategy? What do I really want out of this particular asset?”
Now to do that, it’s actually very similar to buying property. There’s a lot of parallels between buying websites and buying property. So, if you’ve ever done any property investing before you’ll recognize the sort of things that we’re doing. These are the things that we’re looking for when we’re looking for a website investment.
Matt: Especially for the sorts of websites that we buy, which is content sites. You may have seen that on some of our other articles. Just like property, the basic plan with websites is that we buy, we renovate, and we hold for cashflow. Or we might sell, but we’re not website flippers.
Basically, were looking for simple sites that we know we can add value to. We’re not talking about restumping the house, or a massive big renovation like when you buy property. Ideally, it’s that coat of paint, tidy up the front yard, tidy up the inside etc. Think of the 80/20 rule. Just do the simple stuff that moves the needle the most for your websites.
Liz: That’s what we’re looking for. Part of buying smart is really understanding, “How do I find a website where I can do small things that make a massive difference?”
Finding Websites that won’t cost too much to Renovate
Again, it’s the same as in property. When you buy a house (or flat or apartment etc.), you want to do a quick tidy up that doesn’t cost too much. It costs us a bit of paint and a bit of time, and that means you can get more rent for that property. It means that you’re not only getting more cashflow, but you’re able to pay back that property faster. It also means that you increase the value, because for all investments, part of their evaluation is about how much money they’re making. The more money they make, the more valuable they are, and the more someone else (i.e., the buyer), is willing to pay for them.
So, that’s why we’re doing that. We’re finding these websites where we can do the quick and easy renovations and get those incomes up. We do this because we want to pay ourselves back as quickly as possible.
Let’s think about it – say you buy a website for $10,000 and it’s making $500 a month. If we double that income, it’s now making $1,000 a month, or $12,000 a year. So, in one year, we basically paid that asset back to ourselves. And at that point going forward, our risk is pretty much zero. No matter what happens, that asset is sitting there throwing out cashflow. Whether the value of the asset goes up or goes down, it actually becomes less important. There’s a lot less stress involved when you get to that point.
So, that’s a really important in part of our strategy. We want to do this as stress-free and as debt-free as possible.
Matt: And if you think about it, not only is the asset paid off, it’s an asset that’s gone up exponentially in value. Now, when we’re looking at the three times multiplier, this has compounded the value of the asset for you in your portfolio. So, your step number one is buying smart.
Master Strategy Step #2 – Do Website Due Diligence To Know What It’s Really Worth
Liz: The next important element is the evaluation of the website. You need to know how much they’re worth.
Matt: This is an important part of buying smart. This is the mistake that we made when we first got into business – we did not buy smart. We didn’t know how to value businesses. And we made lots of mistakes. We didn’t know how to do due diligence because we didn’t come from a business background. We had to learn all this stuff ourselves.
When it comes to buying websites for profit, there’s certain things you need to look at and understand. So, a big part of buying smart is understanding how to value the website that you’re buying. You need to understand how to do due diligence.
You can check out our free master class and see some of the lessons that we’ve got around the sorts of things we look at when buying and renovating websites, as well on how to do website due diligence.
The other thing that you want to be looking for in buying smart is the concepts that Liz just talked about. That is – looking for websites that we can renovate. So, part of buying smart is understanding the process of finding diamonds in the rough. We all like bargains, right? So, it’s not about getting a bargain price. It’s about finding diamonds in the rough.
Websites that have been neglected or you can see a renovation opportunity. And whether the market’s rising (like it is at the moment) or going down or sideways etc – just like real estate, there’s always opportunities out there to find properties that you can add value to. So, that’s the other part of buying smart, learning how to recognize the opportunities and the diamonds in the rough.
Lucy and Gary Turned a $20,000 investment into a site that now makes $13,000 income a month
Liz: And a great example of this is our elite students Lucy and Gary and the first big website for profit that they bought. Back then, Matt didn’t let them buy a big website. He made them practice on small websites first. But, when they were ready, off they went into the marketplace and they knew how to do due diligence.
Lucy and Gary bought this website for $20,000. At the time, it was a biggie for them. But it was that next step up from purchasing sites for under $1,000. So, they purchased their first big website for $20,000, and they renovated it. After that, it was making $13,000 a month within a few months’ time.
Matt: I would like to say, hats off to Lucy and Gary. What they are really good at is this first step in buying smart.
Liz: Yes, they’re great at recognizing the opportunity.
Matt: I made Gary stick to buying simple little websites for under $200 for a whole 12 months. Can you imagine a go getter, someone like Gary, not being allowed to buy a website bigger than $200? We all laugh about it now, but it made a huge difference because they now recognize the value of a website. They’d done so much website due diligence on all these other websites out there. So, when they saw this one, they knew instantly that it was a site they could renovate. So, this is another great example of buying smart.
Liz: But you don’t do that to people anymore, do you?
Matt: No, I’ve changed my mentoring methods now.
Liz: You let people go for it when they’re ready.
Matt: Yes, I let people go forward a little bit quicker. But, let’s say I’m a slow-and-steady build wealth consistently and safely. That’s my style.
Liz: (But, if you want to go fast, you talk to me!)
Matt: Yes, if you want to go fast, that’s right, get Liz as a coach!
Learn to see the hidden value when buying websites for profit
So, we have lots of other great examples of students buying simple websites for profit. These are websites for sale that are simple content sites.
I think of Samar’s example – she bought a site for a $1,000. It had over 460 articles on the website. Now, someone that doesn’t know websites might not see the value in it. And no one else bid on that website. But think about it – there’s 460 articles on it, and most articles these days cost anywhere between $10 and $30. So, even at $10 an article, for 460 articles you’re looking at around $4,500 worth just for content.
Most people didn’t even notice this website for sale. But Samar saw the value in it. If I was looking at it, I would say, “Hang on, the content alone is worth a fortune here and it’s possibly worth much more than that.”
So, this is what we’re talking about when we mention buying smart. When you understand the game, this is when it gets really exciting. It’s just like if you’ve done property or traditional bricks and mortar businesses.
When you invest in your knowledge with a bit of digital education, this is seriously the best investment you can make in yourself. – Matt Raad, eBusiness Institute
Liz: So, that’s a few of the elements of buying smart. And of course, there’s that old saying, you make your money when you buy. So, it is worth learning how to buy well. So, we have a whole lot of other things around the process of buying websites, and about the strategy of what sort of sites and what we’re looking for and all that due diligence etc.
Master Strategy Step #3 – Renovate to Improve Your Website Cashflow
Liz: The next step then is the renovation. So, as we saw, we’re looking for these diamonds in the rough. And even if it’s not a diamond in the rough, even if it’s a good solid website, we’re always looking to see how can we improve it? How can we increase the cash flow relatively quickly with the least amount of work? And with the least amount of effort and investment?
So, the renovation part, we focus on three things. And you’ll learn more if you sign up for the masterclass. In this masterclass, we go into a bit more detail about those three things. So, there’s three elements of a website where we focus our attention to get those. It’s like the dials of a business.
Matt: Yes, and that’s a good point. In a website there’s three key things that we focus on, which we learned from bricks and mortar businesses. But, this is accelerated online, so it’s a lot easier.
Renovation Step #1 – Look at How to Increase Conversion
Liz: The first thing we want to look at is, for all the people that are coming to the website, we want as many of those people to buy or take an action. That makes us as much money as possible. So, that’s the conversion.
We want to make sure that the layout of the site is really simple. It can be as simple as just moving ads around, or doing other quite simple stuff, to make sure that people find the offer. And when they find the offer, they actually click on it or take that offer up or click on an ad, etc.
Buying Passion Sites that haven’t been monetized properly is a big renovation opportunity
Matt: This point is really important. Most people who are beginners don’t realize, because we take this stuff for granted. Liz is talking about fixing up the conversions. That’s a massive renovation opportunity, because there are so many people out there in the world that build these beautiful websites, but they don’t really know what they’re doing. They don’t know how to monetize them, but they’re passionate about them.
That’s part of buying smart. We buy what we call “passion sites”. And the great thing about those is, people have them for years. They’ve run them, but they don’t know how to monetize them.
So, our students come along and go, “Oh, I know how to get the conversions. I’ll probably just move this ad here. I put a better monetization method on here”. Next thing you know, you’ve doubled the profit.
So, what I want to point out there is, once you’ve got a bit of knowledge behind you, this is probably the easiest thing to fix on a website. Our students can literally do it within a week or so, and we personally did it within hours on our sites. That’s a really easy win.
Renovation Step #2 – Look at How to Increase Profit
Liz: Next, we look at the profit. We look at the monetization of how the website’s making the money, and how can we improve that? Because often times where we can add extra monetization or we can change the programs (i.e. the affiliate program or the advertising program etc.), and increase the existing income by 20-50%. And it can just be as simple as asking a question or changing a link. So, there’s some really leveraged ways to do that.
One of our elite students, Lisa, did just this. She bought her first passive income website, and was able to increase her monthly profit from $2,000 a month to over $7,000 a month. Lisa increased her affiliate commissions by over 500%, just by changing affiliate offers on the site, and reaching out to ask affiliates for better commission rates.
Renovation Step #3 – Look at How to Increase Traffic by Increasing Quality Content
Liz: The third thing, of course, is we want more traffic. Once we fixed up the conversions and the profit, then we just need to get more people coming to the website. Because our websites are content-based, it essentially means adding good-quality content to the site. That’s the essence of what we do.
Matt: I remember when I first got online. Let’s just say I wasn’t the best at English at school. It wasn’t my strong subject. I was good at science, but not English. And I had a lot of fear around thinking that I had to write a lot and do all that sort of stuff. Because it was the kind of sites we liked buying.
But the good news is, it turns out that – surprise, surprise, there’s a lot of smart people in the world who can write much better than Matt can! And so, we just hire them. You can go check out Upwork or Freelancer or Fiverr. You can find writers, like I said earlier, who will write you articles for $10 to $20 to $30. When we want really good articles (in the health niche etc.), we might pay up to $60 an article. But the good news is this can be outsourced.
Matt: This is how we compound our money from these passive websites. Every dollar we make off the website in say the first year we reinvest back into the website in the form of content and tidying up the site. And like Liz said, this is the main work to we do on a website.
Once you’ve done the first bit, the reno is really quick and easy for the profits and the conversions. And then it’s just getting that traffic up with ongoing content. And good news is, like I was saying, that can be outsourced. So, don’t freak out if you don’t know how to write good articles.
Creating Safety in Your Portfolio when Buying Websites for Profit
Liz: So, there’s the three things we do. We buy smart, we renovate fast, then we look at building the portfolio. Ideally, we’re very much safety and diversification investors. In all the things that we invest in (shares, property, websites etc.), we tend to have a portfolio. Because we like the safety of a portfolio going forward.
“Having just one income source is the most dangerous position to be in” – Liz Raad, eBusiness Institute
That means just having one job, one investment, or only one property as your main source of wealth.
Matt: One form of cashflow in your life. That’s very dangerous in this day and age. We were taught many, many years ago to have multiple streams of income. And that was always our goal.
I remember when we first started out together and we learned that concept. Ever since then, we’ve been on that journey of having multiple streams of income. If we look back over our business career, we were never satisfied just owning one business. We bought and sold multiple businesses.
Liz: Well, you do read the stories of a lot of very wealthy people, but they’ve had to sacrifice a lot to get there. And in the end, they’ve had to have singular focus and faith in one business for many, many years.
And for all the entrepreneurs that make it (and make the tens of millions of dollars), there’s thousands who don’t. And I didn’t want to be there. I call it a “baked beans millionaire”. Having to live on baked beans for 10 years in order to make a million dollars or more.
Creating a simple plan for long-term wealth when buying websites for profit
Liz: So, our strategy was to diversify. To have multiple forms of cashflow, to build that cashflow over time, and build up the assets. The more cashflow that comes in, the more those assets are worth. So, just to give you an example, that’s how we do it. That’s our portfolio strategy.
Matt: Let me share with you a simple strategy for a passive website portfolio. This is a typical passive website portfolio that will generate, and probably replace your income. Let’s say a 100K.
As Liz just said, people focus singly on one business. But here’s how we’ve done it, and it’s what we teach.
“We buy a range of simple websites, but we keep the risk low by buying relatively small websites.” – Matt Raad, eBusiness Institute
In the early days, we used to buy much bigger websites. These websites were six figure and above. But these days, believe it or not, our preference is to buy websites under $100K or under $50K. And if you’re just starting out, we highly recommend you just buy a range of websites.
Not every website’s going to work. You’ve got to understand that. But the goal is to have 10 fairly good solid websites that are ticking along. Let’s look at the numbers on 10 websites. We look at monthly incomes. You can even buy quite small ones for under $2,000 (or even under a $1,000), and renovate them to get them making up to $200-$300 a month. I know it doesn’t sound much, but let’s think it through. If you own 10 of those making $200 a month, that’s now $2,000 income a month.
But then say you have a couple of websites that now make $2,000 a month. Or maybe even $5,000 a month. That’s where your portfolio of websites (for most people) will really replace your income.
And here’s the other good news. With this whole process of learning how to make money online from buying websites for profit, your only bottleneck really is the knowledge, because most people are total beginners coming to this. And I’m guessing if you’re reading this, you’ve probably never made money online before (or you’ve not made lot of money online yet).
It all starts with learning how to make your first dollar online…
Matt: What you’ve got to realize is you’ve just got to get the knowledge to make your first milestone. And this first milestone, believe it or not, is to make your first dollar while you sleep. If you speak to anyone at our Digital Summit Events, you will see. We’ve got multimillionaires from other industries that come and do our course and they send us emails saying, “Matt, I just made $13 last night while I slept off my first passive website. It’s awesome. It’s better than all the money I made last year.” That’s because it makes it real for them.
So, the first milestone is making some passive money while you sleep. The first can be $10 or whatever. But then the next biggest milestone that you really want to get to is to be earning $1,000 per month online. Because that means you’ve probably got the knowledge at that point. So, then you just repeat that another nine times.
This is what we recommend is through buying a nice, safe portfolio of websites. You can keep the risk quite low. You can still be working in your high paying job etc., but you can also be building up these assets that are cash machines, once you’ve got that knowledge to get that first $1,000 a month.
This is what a lot of our students do. They’ll buy bigger sites, but they might buy $5,000 websites. Of course, we’ve got students that’ll buy much bigger sites of say $50,000 or even $100,000, depending on their budget.
But when you’re starting out, it’s a fantastic goal that works really well. And again, I want to reiterate what Liz and I found when we owned manufacturing businesses. Even with small numbers, it’s exactly the same thing. We used to sell little widgets for a couple of dollars. It doesn’t look very exciting. You sell a 20 – 50,000 of them. All of a sudden, those little numbers turn into big numbers.
And with websites, it’s so much easier because it’s leveraged. It’s selling 24-7, where you’re earning ad and affiliate income etc. So, those little dollars add up quickly. So, 10 websites, a range of incomes off each website, don’t need that much to generate a big income.
And look at Mark, he’s invested $50,000 into websites. Mark now makes $10-$20,000 passive income a month, plus has a portfolio now worth over half a million dollars from buying relatively small websites. Doing exactly what I’ve just said.
Are you ready to Learn More about how to Buy and Renovate Websites for Profit?
Liz: Yes. So, we’ve got a really amazing opportunity in the marketplace right now because we have lot of growth and there’s so much more growth to come. We’re really excited about the coming 5 to 10 years. Because it’s only going to get bigger.
So, there you go. That’s our strategy for buying websites for profit. And hopefully that gives you some inspiration and gets you out of there. If you do want to learn a bit more, join up for our free master class, because we go through in more detail about how we do this and how it all comes together.
And we also talk about selling websites – when you want that lump sum, how do you set up websites to get the maximum price when you sell as well? Because that’s the other bonus of this. You’re building yourself assets as well as that provide cashflow income.
So, enjoy guys. And if you want to look us up, we’ve got lots of videos there on YouTube with our student success stories. It’s really good to have a look at those and see how other people have done it, because everybody on this journey does it in a different way. So, that’s really inspiring too.