Everything you need to successfully invest in cashflowing websites, even if you’ve never owned a website before.
Hi guys, Sunil here and I’m here with Jeff who is the website investing master or guru! And we’re here to talk about the Website Investing Masterclass which is a course about how to go and buy websites.
Why would you want to do that?
Well let me tell you my story very quickly. I found out about Jeff when I was in the US looking to buy a traditional business about three years ago. Someone told me, why don’t you buy an online business?
That was the first time I heard that phrase and I was like, what’s an online business?
Well obviously everything happens online. So I went onto Amazon and I found the first book I could find about investing in websites and it was written by this guy over here: Jeff Hunt.
And it was an amazing book. It was very, very interesting to understand this new kind of business or this new kind of asset class.
I got very excited especially about the ROI’s that are available. So eventually I call up Jeff and said hey would you help me find some deals. He said yes, he would.
He charged me some money; he always complains that wasn’t enough. It wasn’t enough money, so there you go.
But I was very happy because Jeff helped me make six investments over the course of about a year.
And I was and I still am very, very excited by websites and I think everyone should understand this new asset class.
So the website investing master class is going to help you understand all of that, and to help you understand about the course and this whole topic, Jeff’s gonna answer some basic questions; hopefully that I’m gonna ask him.
Will you answer those questions Jeff?
We will see!
We will see. The first question I’ve got for Jeff is Jeff why would I want to buy an online business?
Well part of my story is a lot like yours and that is that I looked at traditional businesses as well. And what I found is they’re very expensive.
To get in you have to have high net worth for even something as simple as a Taco Bell franchise.
And the reason is because traditional businesses as you know have facilities and equipment and vehicles and employees and all of these things, and that adds up to a lot of asset cost.
Whereas online businesses have very limited physical assets, sometimes none at all. And their assets are completely digital in most cases. So that’s one of the reasons that you would want to get into online businesses, because you can get in for a lower cost.
And of course you mentioned ROI. I mean ROI’s are another reason for sure but I really like the flexibility of online businesses.
I can do it really from just about anywhere. So there are lots of reasons really to get into online business.
You mentioned ROI and that’s one of the reasons I got so excited. Could you talk a little bit more about how the ROI is calculated?
Yeah, I mean the return on investment for online businesses is really driven by the marketplace. What that means is that currently websites are selling for two to three times annual net income.
That’s just what they’re valued at and some are a little more some less. But that works out mathematically to 33% to 50% return on investment at those market rates.
Those are high numbers. Some people have a hard time actually believing those numbers, but that’s just what the market bears right now. There isn’t a lot of asset cost, like I told you so they can generate a lot of cash.
Is that why the ROI is so high?
Yeah I think so. I mean if you look at at the top businesses in the world like the Microsofts, the Apples and so on. They have enormous cash reserves on their balance sheets.
Google is also an example. So they’re digital businesses primarily, Apple has some hardware as well but all of these software companies have lots of cash. I think that is the reason I think the margins are really, really high on digital services and digital businesses in general.
You know usually when you hear quite high ROI it means high-risk. Are these online businesses really high-risk?
Well yeah you know there are some fundamental physics between the relationship between returns and risk and that’s certainly the case here.
You’ve heard the stats about starting a businesses of any kind. There’s a large percentage of them that fail within the first five years.
And even more online businesses fail, I think, than that.
So that’s the reason why we buy websites that are already succeeding. We eliminate a large percentage of the risk by just focusing on those businesses that have already started up, that have growth. They’re no longer babies or in puberty, they’re a little bit mature.
They’re spinning off cash. They have customers. They have products. They have all of the pieces in place.
So we avoid a lot of risk just by choosing the ones that are already successful.
It makes real sense and some people might be watching this and saying well why should I go and buy something when I can just go and build something? You kind of touched on that a little bit with the risks of starting a business, and it’s better to buy something that’s already running with cash flow and customers. But should you buy or should you build a website?
One of the answers to that is that you increase your certainty, the probability of success by buying versus building.
Because when you build, you never know if you’re going to see the first dollar from that investment quite honestly.
And it could be negative. I mean you could actually lose all the money that you invest but there are other reasons as well.
One of them is speed quite frankly. If I buy I’m gonna immediately have the cash flow that it was making yesterday. That same cash flow today is going to be mine as the new owner.
So there’s no way you can do that building. You know it could take months, could take years, it could be never.
Speed is really important.
The other thing is it’s just a lot easier. Look at Shark Tank. Yeah all those sharks have actually started a business before as far as I know.
But are they starting them now? It doesn’t look that way. It looks like they’ve developed all these skills and now they use their skills, not to start a business, which they I’m sure they could if they wanted to but they’re using their skills to go out and select businesses to buy that they think will be successful..
And so that’s what we try to do as website investors. We find the ones that are already successful and then we find the best of those, or the ones that are the best fit for our particular situation and we just buy them.
So in terms of the skills that you need, is there any difference you think between building a website and buying a website?
There’s a lot of skills that are involved when you start anything from scratch because you’re creating a business.
And businesses need customer service and products and marketing and sometimes design and administration; all these skills.
When you buy it, all that stuff is already in place.
You don’t have to be an expert at every single part of it. Most everything is in place and is working and then that kind of narrows your focus.
Then it’s a matter of just having some knowledge and skill in the areas that need improvement or growth. And you have more time. You’ve got a longer runway. You don’t have to learn everything at once.
You can just focus on what you need to, and obviously you can just hire things out as well. That’s what the best operators do.
I’ve got a team of freelancers. I think I have freelancers on almost every continent in the world right now, doing different things for me. So that’s how I leverage things.
So it sounds like you need to have some technical skills but it’s more about the management and being able to outsource the work that needs to be done.
Yes that’s right, it’s good to know the vocabulary and the framework of how websites work and and so on, and that can be learned pretty readily by most people.
Like I heard you talking about if you know Excel then you’re already a user of technology and the same thing applies to websites.
As website owners we are users not creators of software. Using software is very different from creating software from scratch.
So the quick recap; so we can go out there into the marketplace and buy websites. What kind of price range are we talking about here Jeff? Are we talking about hundreds of thousands of dollars to buy these websites?
Well there are certainly some available at that level and there are million dollar of websites available as well. It really starts at the lowest possible end, $100, $500 and goes up from there.
It may not be advisable to buy something like that. That’s almost like starting from scratch actually because it’s not proven itself to be a successful business at that point, so you don’t really limit any risk by buying a $1000 website.
But certainly that’s where the prices start and they go up from there.
Alright so there’s a big price range. You can get sites for a few dollars, although you don’t recommend it, all the way up to multi millions of dollars.
So I buy a website. I have to then take that, I guess own that website and then I have to manage that website to ensure that it keeps on making money on a monthly basis. Is that right?
Yeah when you buy a website you become the business owner. You own that website. You’re responsible for how it works out and the success of it.
I try to buy websites that have a lot of momentum. The systems are in place, there’s already a product, there’s a process to deliver the product, to sell the product, etc. so it’s not like you’re having to turn a crank all the time.
Really you are being in control of it and monitoring it and making sure that it’s doing what it was designed to do.
Got it. Okay so we pick up websites, they’re making cash flow. We can pretty much pick up something in any budget. We can outsource.
That sounds really great.
Amazing ROI’s .
Jeff sounds too good to be true. What could go wrong?
What could go wrong? Haha, well yes, things can go wrong and one the thing that went wrong for me in the early days, was just choosing the wrong websites to buy.
I bought a number of websites I wished I hadn’t bought. I never sought out anyone else to look at the deal. I tried to do some reading; there wasn’t much available to read at that timeto educate myself.
So I chose wrong. I’ve bought a few websites that had problems. Like I had an ecommerce furniture shipping website, a store website and my main furniture supplier ditched me early on.
I hadn’t done the research. So there’s a lot of problems that can happen if you don’t know what you’re looking for.
So how do you get over that risk? It sounds like what you classify that risk as. Is that knowledge risk, is that confidence risk, what would you call it?
Yeah I mean I think it’s knowledge. It’s several things. It’s a lack of knowledge for sure.
I was aware that there were external dependencies that I needed to check out; apparently not aware enough.
Then the other one that’s really important is that it’s kind of a process risk. I had checked the boxes, the boxes I knew to check, the things I evaluated when I looked at the deal.
If I contrast where I was then with where I am now, now I have a process. I have a system.
There are certain things that I check with each listing, so that I have a pretty high confidence level there are not going to be problems in the highest risk areas of a website deal.
That’s the big difference.
Awesome. So there were some of your mistakes that you made. What were some of your big wins?
I have one site I’m kind of proud of. I bought a health website about five years ago. It was one of the oldest health websites on the web. And it has been a very steady earner, has lots of great information. People come there, they click on ads, we get paid.
It is like that. It’s very passive. So I really love that, I mean the ROI over five years is ridiculous. It is over five hundred percent. I mean it’s crazy.
And then I’ve had a number of other ones with really high ROIs.
I had one where I ended up buying it and selling it in the same year. The annualized ROI was close to a thousand percent, just ridiculous. Of course that’s not the norm but every once in a while this is how it works when you’re on this side of the shark table.
You buy a few and a lot of them just knock it out of the park and then you might lose on some. Fortunately I lose on fewer than I used to lose on, so that’s good!
Yeah that’s good. So someone watching this video might be thinking okay, this is a good way for me to attain financial freedom or to build some passive income. How much money would I need to kind of like get started in this thing. I mean you know should I go and buy a big website like a $100,000 website or should I buy a small website like a 10,000 dollar website?
Yeah that’s a good question and I think a lot of people think about that and ask that question.
I’ve worked with people who wouldn’t have any problem at all spending a million dollars on a website. They wouldn’t like to lose a million dollars but they could easily fork over a million dollars for a website.
But those people did not want to spend more than like two thousand dollars for their first website and the reason is that they didn’t have the confidence in the business model of buying websites to spend more than a couple of thousand dollars.
So because they didn’t have that confidence I wouldn’t recommend that they spend more than that.
It was good for them and for a lot of people who don’t have the knowledge, experience and confidence to spend more, to just go ahead and spend less. Then they can go through the exercise of executing a transaction, to actually make a purchase, to know what it feel like to be a website owner at the end of it.
I’m sure you had similar feelings.
Yeah my first deal was three thousand dollars.
Yeah exactly just to gain the confidence and you could have bought a much bigger deal than that if you wanted to.
On the other hand there are people whose very first deal is $500,000. They have confidence to be able to do that. I use that word and I’m not talking about just bravado kind of confidence.
Or some kind of drunk-and-disorderly confidence. I’m talking about confidence based on research and that the deal that they’re looking at is the right one for them.
Maybe they’d had some experience on the internet or whatever. There are tangible things that can increase your confidence level in a deal and if you have done those things and have done the homework you feel good about it.
Then that’s time to go for a bigger one, because the bigger ones generally are higher quality. They’ve been around longer, they’ve got more momentum behind them so they’re going to be higher quality when you go big.
Sure so if you do start small and you do go buy a small website to build confidence how do you scale up to a stage where let’s say you’re making ten thousand or fifteen thousand dollars a month?
There are several ways to scale. One of them is a portfolio method where you would buy sites that are similar and and actually have something in common, that help each other. And specifically what I’m talking about is if you can buy multiple websites that make use of the same team, that make use of the same systems and processes that you have, or have kind of a symbiotic relationship.
Like you buy a website that sells a particular kind of product and then you buy another website that has customers that will be customers for the other product. Then there’s some relationships there and some synergies there.
So one way to do it is to build a portfolio that’s synergistic.
Yep or you could do it like I did which is build a portfolio that had no synergies whatsoever. Haha, that was sort of my mistake.
Yeah the smart way is to build a synergistic portfolio or to just take one and just pour your energy into it and only buy additional sites if it’s really strategic.
So you can scale in multiple ways. You can find examples of people who have taken a single website and made it into a 50 million dollar business. So you can do it both ways.
So how do I learn more about the website investing masterclass and or how do I learn more about website investing?
I’ve taken my experience and I’ve poured it into this website investing masterclass. I’ve developed a system for it and one way I think would be good for me to describe it is this.
As entrepreneurs our problem is not that we have no opportunities or too few opportunities. Our problem is exactly the opposite, that we have way too many opportunities.
For website investing that means there are way too many choices of websites to buy.
One of the focuses, the goals of the masterclass is a method, a very systematic approach to taking all of those choices and then narrowing those down to the one that you need to buy.
We help you locate properties to buy. We help you then evaluate them.
The evaluation step is really important. There are four case studies in the evaluation section of the course and for each of those case studies we teach you a system.
The system is complimented by the set of tools that you use to evaluate each deal that you look at.
The reason it’s important that it’s a system is because you’re probably going to be looking at a number of deals before you find the ones that you really want to buy. So it’s important that you have a good checklist that you can run all those deals through.
That will build your confidence that you haven’t overlooked something important or you haven’t missed the fact that there’s an opportunity or a risk.
That you make sure that you’re thinking of the right questions to ask the seller for example. So what we do in those case studies is we go through each one with the tools and process and that gives you a chance to repeat the steps and learn that system that you can then use for yourself, for your own websites.
Then we take you through some education on how you do the acquisition itself, what the process is, what the transaction looks like.
At the very end of that you own the website and what do you with it. We take you through the initial steps to make it more profitable and to grow the business.
Sounds really good! I also like to mention that with the course you also get the tools.
And every course that we do obviously you get to be part of the community.
That I think is one of the most important things. Getting good information is one thing but having a support network, having people doing the same thing as you, I think is even more important because that inspires you to go on when you see someone else do a deal, when you see someone else making money, it’s like well why can’t I do it as well?
And you go and get the inspiration and go and do it and then you’re being inspired and going to do something to actually inspire somebody else. So having a good networking and support community is really really valuable for that.
So that is the whole package. There are more details below this video about how you can get involved .
if you’d like to learn how to buy websites and how to make money from investing in websites and operating those websites then this is the course for you.
It contains everything that you need to know, Jeff’s wonderful four-step system and the tools and the community that allow you to do that. Last question. Jeff do people really need this course to go and buy websites?
It is obvious that you really need to educate yourself before you make any significant investment. Beyond that if you’re really serious about it like other serious investors are, not only would you buy the course you would also probably find someone to mentor you.
Even after you educate yourself you can go back and play ideas off of them, talk about deal structures, etc.
And then even beyond a mentor when you really get down to, okay I want to buy this website, even though I’ve bought more than 300 income-producing websites over time, I still try to get another set of eyes on the deals.
I find my peers to look at them. So I mean yeah you definitely need to educate yourself and the course is one of the best ways that you could possibly do that.
But there are other ways to educate yourself beyond the course, even getting a coach, getting a mentor and then having other people, paying other people or just finding colleagues who are willing to look over your shoulder and check your math. They make sure you’re doing the right thing and check out the deal.
That’s what the most successful people do. Multiple levels of those things to ensure success.
Absolutely so if you’d like to learn how to buy websites, again all the details are below this video.
Check it out and we’d love to have you be part of the community where both Jeff and I are and we’re ready to help you out if you need the help.
So thanks for watching! I’m Sunil. I’m Jeff. We’ll see you all soon
The Website Investing Masterclass…
A Proven System
There is no shortage of online business deals to invest in. This course trains you in a repeatable process to systematically evaluate each opportunity. You will learn the most important aspects of deals to evaluate and how to use online tools to uncover opportunities and risks in each area.
7 Video Modules
Tools and Resources
Get access to a valuation spreadsheet that will allow you to estimate deal value for each opportunity. You'll also receive access to checklists and a collection of online tools to evaluate websites.
5 Business Models
Four Case Studies
Total Duration: 00:00:00
Run through of the key success factors in the Locate, Evaluate, Acquire and Profit process.
The specific benefits of investing in website businesses and the advantages of online business over traditional businesses.
The systematic process for finding deals that meet your requirements. How to find both published and private opportunities as well as brokered and auction listings.
The repeatable, high-confidence system for evaluating website opportunities. Four case studies that train you in the use of tools and the process you should use to size up each deal.
A guide to the acquisition process including the contracts, money transfer and transition in ownership of the online business assets.
You are the owner, now what? This module walks through the priorities and first steps of taking control of the new business, optimizing profit and establishing a framework for growth. Plus a guide on selling your site when the time is right.
Wrapping up the course with a word on how to get help as you buy and take the reigns of your first online business.
But What If I Know Nothing About Websites?
Website buyers come from all backgrounds and walks of life. As an investor, you don’t need to have detailed skills in technology, marketing and design. Everything can be hired out.
Nevertheless, a little education goes a long way. Included with the Website Investing course is the Online Business Masterclass. This is an end-to-end, comprehensive class providing both practice and theory in all the basics of online business.
It can be consumed start to finish, or as a resource for understanding specific concepts when and as needed.
About Jeff Hunt
Jeff Hunt is an internet investor, website owner and Internet marketer. He supports his family of 6 from his home PC and iPhone.
Over the last 10 years, Jeff has bought and sold over 300 income producing websites.
He speaks, teaches and coaches and is always on the lookout for the next big deal.
As a Project Executive for IBM, Jeff managed $25 million annual outsourcing contracts for mega-clients including Kodak and Sony-Ericsson. In between offline and online careers his family spent 7 years in a West Asian country serving students, families and small businesses.
Today Jeff enjoys capitalizing on internet opportunities and helping others to do the same. He actively buys and grows websites with the intent of creating multiple passive income streams.
Jeff makes his home in Indianapolis with his wife and 4 kids.
Website Investing Masterclass Order Form
Frequently Asked Questions
Do I get immediate access?
Yes, as soon as you book you will be sent access details for the masterclass along with details of how to access the membership site.
How long do I get access for?
There is no end date to your access. As long as Flip Minds is in existence, you will have access.