Website Investing Weekly 🎲 Bet on Wix?

Welcome to Website Investing Weekly, bringing you up-to-date with what’s been going on in the world of website investing and alternative related asset classes. If you’re not already on the list to receive these updates, sign up below. You can also leave comments at the end of the post.

🌐 New Venture for Wix

Wix has 44 menu links at the bottom of their homepage. The last one was quietly added last week.

We're all aware that Wix offers a platform to build websites, get hosting, and even hire designers and marketers, but this new link is a complete departure from those service offerings.

Wix Capital is their new venture capital arm. It aims to participate in seed and early stage investment rounds worldwide. For now, the focus is on "software and technology companies that sit at the intersection of online design and development, commerce and business management and AI and automation solutions."

And they've been busy handing out the cash. So far, Wix Capital has injected over $5.6 million into several companies including: 

  • Spike, a communication and workflow tool

  • Oriente, a digital fintech company

  • Modalyst, a dropshipping platform, and

  • RestAR, a 3D capturing and AI product visualization tool

We noticed that these investments are all symbiotic in nature. Wix's "website investment" strategy allows them to gain particular insights and knowledge from their involvement with these businesses.

Given that this news seems to have escaped the mainstream media, you can view the Press Release from PRNewsWire.

Interesting to see that the WIX share price has doubled since the start of the year. But more interestingly is that some domainer (not Richard) has bought up wix.vc betting that the company will buy it from them - good luck with that!


⏱️ Good Use of Your Time?

Pixabay

Do you value the time you spend running your online business? You may have a rough idea of how many hours you work each week, but can you narrow this down to time spent on specific tasks?

For a sole operator, it's easier to calculate the daily commitment required for various business activities. When you have a team of people working with you, that job is a little more complex.

Website buyers come armed with a list of questions when they're looking to acquire an online business. One of the first questions they ask is, "how many hours per week do you work on this business?"

We all know that it's impossible to buy more time. That's why we advise business owners to hire or outsource the mundane tasks that aren't directly related to growing revenue.

Steve McGarry writes:

If your online business is requiring more than 10-20 hours per week to operate, it may be time to bring someone in to manage if you want to treat the business as a passive income stream.

A buyer may look at your site and decide that the time commitment to run it is too great for them.

The best thought we took from Steve's article is this:

If your business has a 50% profit margin each month and you provide a contractor hired from Upwork to make the business 100% passive but move to a 40% profit margin, most investors will be happy with that.

We'd consider getting that help now instead of waiting until you're ready to sell.

But, if you offer a new owner support during the transition period - either with existing contractors or a new hire - then this may help swing a deal in your favor.


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🍏 Forever Green

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A clever marketer once said that only 3 types of businesses always make money: the ones showing people how to get paid, get laid or live forever.

Before you dive into buying, growing and, ultimately, selling websites for a profit, ask yourself whether you're in the right niche.

B2C sites (business to consumer) generally fall into two broad categories. They're either sites that offer evergreen products or sites offering something new or trending.

Flippa recently published an article outlining how to spot the difference. 

Their post covers the specific components that make up an evergreen site and also tells you what an evergreen business is NOT.

The two primary qualities of an evergreen website are the ability to create a sustainable income year after year and to survive changes in annual trends.

In the article, Ron Stefanski mentions 3 popular evergreen niches:

  1. Weight Loss - and probably diet

  2. Online business - teaching people how to make money online

  3. Personal development - mindset, self-esteem, etc

We'd add dating, technology, and finance to this list. But that's just our opinion, and you probably have your own ideas.

Take a look at the rest of the article for good advice on evaluating an evergreen niche.


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🔊 Acquiring PR

Last Monday, we discussed a few ways to sell your website for free. One of the better ideas mentioned was selling to an indirect competitor. That is; someone who markets a product or service aligned to yours, but which is not exactly the same offer.

While looking at recent sales and acquisitions over the past week, we noticed a prime example of this strategy in action.

Many of you will be aware of SEMRush, if not a paying customer for their SEO software. SEMRush is based in Boston, USA, and focuses on online visibility management and content marketing. They've just announced their acquisition of a Warsaw-based public relations SaaS startup, Prowly.com.

Prowly's core business is media coverage and press releases, so it makes sense that SEMrush plans to add content marketing tools to the mix.

It also demonstrates that location is no barrier to a successful sale.


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Quote of the Week

Our quote of the week comes from Marek Echkaus, who is the CEO of Brands.International - a private domain name marketplace.

To ask the domain broker whether the domain name they offer to you is the “good domain investment” is the same as to ask your barber whether you need a haircut.

Marek no longer invests in .com domains, as he believes that the new gTLDS (generic top-level domains) are where the next investment opportunities lie.

He's given his opinion on this market and some tips for success right here.


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Interested in sponsoring this publication? Every update gets emailed to over 2,600 people and averages ~ 1,500 views, with click-through rates as high as 8% on links. The web version of the posts get shared on social. Visit the sponsorship page for newsletter and podcast advertising opportunities.


That’s it for another week, hit us up in the comments at the bottom of the web version.

Cheers!

Juliet Lyall & Richard Patey