Selling Websites for a Living

Late 2007 I had a site doing very well in the identity theft niche. Lifelock were pushing their services with an aggressive advertising campaign that as it happens turned out to be full of lies and bull sh*t. They are now all but finished after being fined $12 Million earlier this month for the above mentioned marketing tactics.

Like many other companies that use affiliate marketing Lifelock just didn’t get it. They applied rules to hold back the affiliate marketer but all they end up doing is driving the best ones towards their competitors.

Example: Lifelock banned the use of their name and other related words from being used in PPC campaigns. So what happens is someone does a search for Lifelock but instead of seeing 10 Adword ads all competing for their click they see 10 ads for their competitors products because all the smart marketers are now bidding on the terms Lifelock have banned.

Its not an affiliate campaign these companies are running, its a branding campaign. Lots of wannabe marketers slapping up banners on their blogs that nobody clicks but everyone sees.

Anyway, I stumble on a misspelling that wasn’t on their banned list and for months this particular site was doing over £1000 a week (at the time around $1500) for an Adwords investment of pennies.

It never entered my head to sell the site but if someone had offered me a lump sum I would probably have taken the long haul view and hung on to it anyway.

Months later and I’m suddenly taking phone calls in the middle of the night (GMT) from their marketing manager wanting to know how I’m generating so many sales.

Long story short the attitude is they don’t like how much money I am making instead of thinking about how much money I am making them. They change their rules to lock out my misspelling and that’s that. By the end of the Summer the site is reduced to an Adsense site and left to gather dust.

That site could have gone for anywhere between $50K and $60K if I had thought to put it up for sale.

Ever since then I’ve sold just about every site I’ve built once it’s peaked.

You could argue that if I hadn’t been banned from using my keywords then I would have had another 18 months out of it and made much more than that and you would be right but I would have the cash in the hand while the new owner had the worry of keeping it going.

Since I got involved in building profitable sites with the full intention of selling them I’ve met plenty of other people that got involved for the exact same reason.

Dave Kelly of LinkVana fame tells how he was offered and turned down $375,000 for a site (which was over twice its annual profit) only for the company he was generating leads for to change the rules and his profits plummet 3 months after the offer.

When I sell a site now it’s a relief. The pressure is off. I don’t have to worry about a better marketer than me moving in on the niche. I don’t have to worry about Google suddenly changing the rules or bad press to suddenly break about the product my site is selling.

I can relax and start looking at another venture or pushing one on that’s already running.

The secret is to not get attached. It’s not your baby, it’s a piece of online prime real estate but built in the hills of California. Your heart will tell you it will be around for your retirement but your head should tell you to sell before a bush fire or Earth tremor brings it crashing down.

That’s not to say that when I sell a site I am expecting it to collapse. There’s a reason profitable sites sell at around 12 months their earnings. Even if the buyer does nothing, most sites should continue making money for a year before eventually fading so the buyer almost always gets their money back within a year or so.

If they put some work in and continue to promote it then they could have a real bargain on their hands. Doubling your money in 2 years is an amazing investment opportunity not to be sniffed at.

For anyone that is constantly looking at the ‘next niche’ though, sites start to slip. Google likes fresh content, they like to see links built up gradually. You can’t just slap up a 1000 page site and point 100′s of links at it and then move onto the next.

The name of the game is regular and consistent.

If you are a typical net entrepreneur it will go something along the lines of:

You uncover an untapped niche and get all excited. You build and lovingly promote it regularly for 3 months until one day you check and it’s number 1 for it’s main keyword. You pat yourself on the back, forget all about it and move on to the next market!

6 months to a year later and the site drops. Someone else moved in. He’s made a post every day for a year and built his links nice and slow. If you wanted top spot back you would have to drop what you are doing and not only match him but catch him up and then better him.

That’s a whole lot of work you just made for yourself.

Why not get it to number 1 then monitor it’s earnings for 3 months and sell it on? Let someone else do the worrying for a change.