Website Investing Weekly: Cash Flow Assets
Why cash flow is king, one-word domains, improving your website to flip, and other juicy news.
Welcome to Website Investing Weekly, bringing you up-to-date with what’s going on in the world of website investing and alternative related asset classes.
🖥️ The Digital Asset Upside
The old adage is that "cash flow is king."
And more businesses fail due to a lack of cash flow, rather than a lack of profit.
Traditional cash flow investments operate on the premise that you're creating wealth for the future. Investments like rental properties, peer-to-peer lending, and index funds are solid choices, but they don't provide a steady stream of income every month.
What's the best alternative?
For us, investing in digital assets has tremendous upside. In particular, online businesses are an attractive choice because they're income-generating assets.
Empire Flippers agree:
...you can realize a return on investment that outperforms traditional cash flow investments at a lightning pace.
That's a big claim, but Sarah Nuttycombe makes an excellent argument for choosing online businesses as the best cash flow investment.
She covers 5 great reasons to diversify into website ownership, but her breakdown may be applied to other digital assets.
We agree that the low barrier to entry is a major plus. You can set up a site for a few hundred dollars and gradually grow it to where it produces a decent income. The obvious alternative is to purchase an existing website that's within your budget. The amount of investment is up to you.
Other benefits include:
Freedom from limited interest rates
The chance to build a portfolio
Gaining faster positive cashflow, and
Aiming for passive income
We're not saying that investing in online assets is risk-free. No investment is.
But, the addition of online businesses to your overall investment portfolio allows you to achieve more diversity, and offers the opportunity for a better return on investment.
🤸♀️ Readying Your Website for a Flip
What does it really take to improve a website?
If you're a seasoned investor who buys sites to grow and flip, you'll know that this begins with buying the right website in the first place.
Once you've done that, the real work starts.
In his latest article for Onfolio, Dom Wells says:
…unless you’re an expert, most of the ways you can improve a website are hard.
Improving the SEO on a website is perhaps the most difficult option for a "non-expert."
But, it's not impossible, and it's the reason many investors choose a newer site that has potential for improvement over a site that is well-established.
The most common methods to grow a site range from the easy choices, e.g., using display ads, to more difficult ways such as swapping out your Amazon links for private affiliate programs that pay more.
When you buy a website from a marketplace platform, the due diligence reports will identify areas that have room for improvement. Some marketplaces offer a list of tactics you can implement to grow a site. These range from quick wins, to using techniques that you may need to outsource to a professional.
Dom suggests looking at what's obviously broken. He lists the following areas as a good place to start:
A large email list never emailed
Broken affiliate links or not enough affiliate links
Bad internal linking
He also outlines a range of additional monetization methods to give you a little inspiration.
We see plenty of decent investment opportunities every week. These are the member-only deals you'll get in our Digital Asset Deals email every Thursday. If you'd like to stay ahead of the game, hit subscribe below.
As Dom said:
A lot of the easiest opportunities are picked up quickly by savvy buyers.
🛋️ Looking for a Passive Income Source?
Has investing in digital assets been on your mind, but you don’t know where to start? Blackbook Investments has you covered.
Get access to undervalued web properties and earn a much higher ROI compared to other asset classes. Whether you're looking for a consistent income or big capital gains, website investing can help you achieve that.
With their personalized, comprehensive service and a vast network of buyers, sellers, and brokers, Blackbook Investments has been helping folks like you invest in websites for almost a decade.
Fill out their Investor Questionnaire to see if website investing is right for you.
🔥 Hot One-Word Domains
One word domains have always been hot property.
Even when they're made-up names like nas.com, which sold for $720,000 last month.
We did a bit of digging around for you and came up with a few interesting statistics on domain name sales. Of course, some of the biggest sales are never publicly reported.
Here are the highlights from our research:
The most expensive domain name sale (publicly reported) is voice.com at $30 million in 2019.
Cars.com was valued at $872 million (we found this number in the SEC filing, courtesy of the parent company, Gannet Co., Inc.)
54% of the 100 highest-value sales were single word domain names
The top 100 reported domain sales of 2020 are found at Namebio.
Embrace provide a great round up of historical sales of one-word domains, most of which are one-word domains
Sedo reported the most high-value domain sales
But, it was something else that got our attention.
Domain Investing just reported on an interesting one-word domain sale.
Why would someone pay $400,00 for Ingles.com?
Many of you will recognize this as the name of a US supermarket chain, but the domain has been purchased by a translation tool.
It now forwards to SpanishDict.com. For those not conversant in Spanish, the word Inglés translates to “English.”
I'd call that a smart domain name acquisition.
By the way, Ingles.com last sold in 2014 for $49,899.
🦄 SEOs with Skin in the Game
Smash Digital - a growth agency, filled to the brim with unicorn images and SEO memes. A team of SEOs with actual skin in the game, ranking their own portfolio of profitable businesses, and offering the exact same services to clients. An agency with so much link juice you’ll need a mop and bucket to clean it all up. Check. Them. Out.
👁️👁️ An Overlooked Investment
These search terms are not trending:
"What is digital real estate?"
"What are digital assets?"
Because you’re interested in these topics and you subscribe to our newsletter, it's likely that you understand these terms.
You're probably reading this because you want to learn more about this type of investment or you already invest in digital assets (or would like to).
The lack of internet searches conducted on these topics led us to arrive at these conclusions:
Everyone knows about investing in digital assets
No-one knows about investing in digital assets
Very few people know about investing in digital assets
We believe that website investing - and investment in other digital assets - is still not on most people's radar. Just try a quick search to see what comes up. Even when you enter "what are the best investments," you'll only find results for the more traditional investments classes.
Flippa's recent article on digital real estate briefly summarizes 4 typical digital investment types: websites, mobile apps, e-commerce stores, and content creation platforms.
We could add others to this list, e.g., podcasts, YouTube channels and, most recently, newsletters.
Two mini case studies are noted in the article; one for a buyer and one for a builder.
It's fascinating to note that the Huffington Post started as a news blog back in 2005. It's now one of the leading online news aggregators, making more than $2 million per month.
Digital assets are here to stay, but it appears that much of this "real estate" is still overlooked as an investment opportunity.
What do you think?
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Need something to listen to today?
Richard Patey was featured on the new Indie Media Club podcast. He shares his insights on new digital media monetization models (newsletters feature here) and acquiring profitable content websites.
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