Today he shares his client Lisa’s inspiring tale. He delves into how this stay at home mum wanted to capitalise on the increasing web asset profit market without sacrificing quality time with her children. We’ll hear how she did it and what steps she needed to take to achieve— and exceed— her goals. In addition to sharing Lisa’s steps to success, Raad reveals the similarities and differences between flipping houses and websites, and you won’t want to miss how much one of his clients sold a $2,000 website for!

Timestamps:
00:07 | The Mighty Rise of the Website
02:01 | From $100 to $19,000 in 1 Website
05:03 | Find Your Niche
08:26 | No Millions Needed
12:10 | Risk-Free Renos
14:35 | Cosmetic, Not Structural
16:00 | Is It Too Good to be True?
17:44 | Matt’s Graph
23:44 | From $2,000 to $20,000 to $200,000...

Resources and Links:

[00:05:45] So now she's got this awesome portfolio of websites that she knows back to front. And once she's got them up and running, they're kind of semi passive. It's not what you got turn up every day, nine to five to work on these. And she's just building them up. 

This is Property Investory where we talk to successful property investors to find out more about their stories, mindset and strategies.

 

I’m Tyrone Shum and in this episode we’re speaking with Matt Raad, co-founder of website investment company eBusiness Institute. He’s here to delve into a client’s investment story featuring a stay at home mum who went from making $100 a month to $19,000 a month with just one digital asset! Find out how she achieved her goal and how you can do it, too.

Tyrone Shum:   

Together with his wife Liz, Raad conducts renovations of his own, but with digital assets as his properties. Something we can consider as an insurance policy.

Matt Raad:   

[00:00:07] It is definitely a pleasure to be back here talking about my favorite topic, which is investing. And particularly in light of what's happened over the last year, like, who would have predicted property prices going so high? But also, of course, websites, which would be good fun to have a chat to you about today, because a lot has happened in our marketplace as well.

Tyrone Shum:   

[00:00:27] For sure. And who would have known COVID actually accelerated things much faster? Now, we're kind of pretty much all online, like websites, Zoom, everything pretty much 24/7. That's how we actually do our shopping. That's how we [are] communicating. It is just crazy and a very interesting time with how it's changed the way we work. Forget about going to the office, now we can just pretty much have our conferences online.

Matt Raad:   

[00:00:52] That's right. And I think one of the biggest things that has taken us by surprise, probably like all your listeners and your communities [is] that how have these asset prices just gone skyrocketing through the roof? Not just shares, but obviously property in Sydney and Melbourne? But also for us with websites, we've seen massive increases in prices of web assets, which is really exciting for us.

Tyrone Shum:   

[00:01:20] What I'd love to talk about today, then, is really the reason why I wanted to invite you back to the podcast, is to share a case study or some success stories from your community, because you've had some fantastic results. And especially people who have been in property in the past and thought, 'I've got a great asset of property portfolios, but I want to actually diversify a little bit.' And I know you've got some great studies, or success stories of past students and current students who have gone on to do that. So maybe let's delve into maybe one of them. And you can share with the audience how that kind of story has been successful in achieving that within your community. 

Matt Raad:   

[00:02:01] When you asked me earlier about some of the specific examples, the one that really comes to mind— because she is a property developer, comes from that sort of background on property— is Lisa. And she bought— this would have been three years ago— a simple little site for $2,000. It was only making a couple of hundred dollars. And she's been renovating it just like you would with property, just gently renovating it. And this is a passive website, it just makes money off content and advertising. And she's just hit $19,000 a month profit.

Tyrone Shum:   

[00:02:38] Wow, that is phenomenal.

Matt Raad:   

[00:02:40] And it gets better Tyrone, you'll appreciate this. That will probably sell. We've got a bit of a plan that we're working to and Lisa is such an awesome go-getter. She's very, very focused. Her goal is to sell that for seven figures.

 

[00:03:01] She's pretty excited because she's a stay at home mum. She works on this now full-time. And it is purely through posting content and renovating simple reno. So what it was, just for your listeners, we make money off websites. And not ecommerce websites. So we're not selling physical products. What we do is we have what's called affiliate websites, and we make affiliate commissions, or we have advertising on them. 

[00:03:27] And that's what Lisa's site is, it's an affiliate website. And basically she gets a commission every time someone buys a product through her website. And it's in an exercise niche. And so obviously, exercise has gone really well since COVID. And so, go Lisa, she's done really well. And she's just been consistent. She's been renovating this website, and when she bought it was only making a couple of hundred dollars per month. And she kind of left it parked for the first year. 

[00:04:02] And then we started teaching this more accelerated strategy of putting lots of content on the websites. And she thought, 'That sounds good.' And she started applying that to another little website that she had as well. And she got great success with that, but not as big as $19,000 a month profit— she got another site to make a couple of grand a month. So it's kind of like a rental property. She bought a couple of sites and the other one, I think cost around $3,000 as well. 

  

[00:04:32] She got that to making a couple of thousand dollars a month and realised, 'If I do that on this exercise site, it will go a lot better.' And so she got that up to making about $2,000 a month profit and it went to $5,000 a month, and literally just recently at our three day event she told everyone it's just hit $19,000 a month. And that's before even the Christmas run up!

Tyrone Shum:   

[00:04:58] I can't imagine what it'll be like for Christmas then! Or even the new year.

Matt Raad:   

[00:05:03] Now that she's onto this, it's like for you guys, when you guys buy a property, when you get that winning formula. So each of your listeners probably has a strategy that they're working to whether they're doing developments or they're doing fixer uppers, or renovates and hold. Lisa's now got this strategy and she knows this niche really well. So she's gone out and bought another site in virtually the same niche. She found that at a really good price, but she still had to pay a bit more money for that, I think she paid around $30,000 or something for the second site. But it will probably quadruple as well. So it'll end up making the same kind of money by the looks of it. 

 

[00:05:45] So now she's got this awesome portfolio of websites that she knows back to front. And once she's got them up and running, they're kind of semi passive. It's not what you got to turn up every day, nine to five to work on these. And she's just building them up. And then what she'll do is she'll bolt them together and sell them off to a big corporate or to what we call an aggregator, which is something we're seeing a lot more of in our industry now. So there's a lot of big buyers looking around for exactly those kind of websites that Lisa's created and are paying big multiples for them.

Tyrone Shum:   

[00:06:19] That's awesome. Awesome. Before we jump into a little bit more details behind it, can you tell us a little bit background behind Lisa? Because I just want to paint the picture of what her pain points were before jumping into. Why did she want to move into buying websites? Because obviously, she could have gone to so many different other markets, she could have gone to shares, buy a business, etc. Why she jumped into this particular niche?

Matt Raad:   

[00:06:45] I think in Lisa's case, having— like a lot of our clients, or our community's case is a lot of us in our community are parents, like yourself Tyrone, and we're at that age. Our community tends to be older people— I'm not going to say what age but a lot of us are older than yourself, let's just say. And they're typically getting out of PAYG or they'll have a corporate role or they work long hours, or they have older kids, or a lot of us have younger kids as well. And what they're really looking for is that freedom to work from home. Because that's what Liz and I have done over the years, and particularly when our kids were born. That was always our goal to work from home and raise our kids. 

 

[00:07:35] And I think that's probably the main driver for a lot of people in our community and say for Lisa. And then also the other pain point is— this was admittedly before COVID— but I think for you property guys, someone like Lisa, everyone's not sure. When you get into property for a lot of people, you max out with the banks here in Australia. That's what we get feedback from our property guys. 

[00:08:00] So property is brilliant. It's kind of a no brainer in Australia, isn't it, to make wealth through property. It always has been. But I think the pain point, it's a really smart question of yours, is you get to a certain point in property where they just max out with the banks. And it's starting to take on a lot of risk if you want to borrow the millions of dollars, or the hundreds and hundreds of thousands of dollars once you really want to expand that portfolio. 

No Millions Needed 

[00:08:26] So I guess they start looking at digital assets and go, 'I can do exactly the same thing as what I've done in property, but at a fraction of the cost.' No one in our community's out there buying million dollar websites, not at this point. They're selling them for that price. But they're not buying million dollar websites. Whereas I'm sure in your community you've probably got heaps of listeners who are buying million dollar properties, or once they do a few properties they're getting up to that range. 

  

[00:08:55] And I think that's the pain point. It just gets a bit risky in this environment. Even though interest rates are so low, for your average person to start borrowing big money, it gets a bit scary. So I think they look at websites and they go, 'Oh, cool. I can buy a website for under $50,000,' or under $10,000 like in Lisa's case, it was $2,000. That's all it cost. And I've got another client, just today I was working with them. They bought a website for about the same, $3,000, and this thing will make $1,000 a month. And they actually commented to me and they said, 'Wow, that's more than the net rent return I get on an apartment I own.' So yeah, it's crazy. It's crazy. And plus what I'm excited about is the asset values are going up now. So there's that as well, which never used to be as prominent.

Tyrone Shum:   

[00:09:49] That is crazy. So when you think about it, buying an asset for $3,000 return is a $12,000 net return each year. That's a 400% increase. 

Matt Raad:   

[00:09:59] Yeah, but understand you've got to renovate it to do that, just like with a property. And our background is property, if you listen to that other interview that you did with us, you'll hear Liz and my background is actually buying and selling businesses. We always used the money from our businesses to feed into property back in those days. And what our strategy back then was we don't want to build houses where we're completely re-building. Just simple renos. Coat of paint, change the handles on the cupboards, and just kind of simple stuff. That's what we try and do with websites as well. 

 

[00:10:35] And so these days, the main thing that we teach people, or that we do ourselves, is basic tidy up to the website, and mainly putting on content. And so to get those sorts of returns that we're talking about, you do have to do some work. You've got to do a basic tidy up. But it's not restumping the house or anything, it's just a simple makeover.

Coming up after the break, he reveals the benefit of website renovations that Lisa found most attractive...

[00:12:30] And I think that's what she really likes, because she can raise her family and work on the site at her pace.

We discuss how property renovations and website renovations are more similar than you would think...

[00:15:27] We renovate every site with a set kind of formula. And so we do change it around. And that's a renovation opportunity that we're looking for, Tyrone. So it's like you guys look for certain renovation opportunities when you buy properties. 

We discover how astonishingly quickly you can turn $2,000 into $9 million, without touching even one tin of paint!

[00:23:09] You can build good websites, if you've got the skills. And you can be flipping them into bigger and bigger deals. And we just did this cool interview with one of the world's best website brokers, his client, within five flips, turned a $2,000 website into $9 million. 

And that’s next. I’m Tyrone Shum and you’re listening to Property Investory.

Are you interested in small investments with big profits?

If the answer is yes!

Then check out Matt and Liz’s free video training series that can show you how to buy and renovate cashflow websites. Simply visit PropertyInvestory.com/online/

When you sign up, you get access to 4 powerful and practical video training series to help you find and purchase online cashflow properties. I’ve personally watched these videos and highly recommend learning from Matt and Liz as they are the experts at this.

To get access to your free video series, visit propertyinvestory.com/online/

Tyrone Shum:   

Raad considers the work they do to be ‘mini renovations’, as because everything is online, there’s no expensive tradies or waiting around on sites involved. This was one of the most important elements for Lisa.

Matt Raad:   

[00:12:10] She said, 'I literally just parked that website for the first year that I owned it. And even when I'm doing the reno, I don't have to be working on it all the time. I don't have to turn up. I don't have to meet tradies with it. There's no budget as such, except for the articles. You've got to pay outsources to write the articles. But really, it's just work at your own pace.' 

  

[00:12:30] And I think that's what she really likes, because she can raise her family and work on the site at her pace. So if you want to work late in the evenings or something like that. But at the end of the day, it comes down to your time. And content these days, your average article's about $20 an article. When you think about it, that's all you're risking. 

  

[00:12:49] So I think on her first site, the little tiny site that she had, I think she spent— it's on our blog, I can't remember the stats— a couple of grand in content. And that was enough to get it to making about $1,000 a month. And that's when she realised, 'Okay, this works. Now, I'm going to do the same one this other exercise affiliate site,' and it worked particularly well. It is incredibly leveraged. I think property people look at what we do and just go, 'It kind of overcomes the main pain points of property.' The biggest thing that we've always said with websites that we've noticed is the really high cash flows. It's that ROI is massive. When you get it right, your cash flows literally are sort of the net rents that you guys would get on your properties.

Tyrone Shum:   

[00:13:48] I've experienced it personally myself.

Matt Raad:   

[00:13:52] Your average affiliate site will make you $1,000 to $2,000 a month, when you get into the slightly bigger ones. And you can buy them any day of the week. Once you know what you're doing. You've got to learn a few things first, but they're typically selling for $30,000 to $50,000. And you can get an income of anywhere from $500 a month up to a couple of grand a month.

Tyrone Shum:   

[00:14:17] That's awesome. So I guess in Lisa's case, as you said, she started off buying this site for $2,000, did a bit of renovation behind it, which is basically increasing the content. Did she redesign the site or anything like that or tweak the site? 

Matt Raad:   

[00:14:35] Tweaked it, definitely changed the look, but not to make it really pretty or anything like that. I should mention Lisa was a complete beginner at this. She was doing this as she was learning off us what to do. And we have a specific way that we renovate websites, which is the way that they're set up. And it works really well. It works on any kind of website, doesn't matter what it's for. Except for e-commerce, we don't do e-commerce because that's a lot more complex beast. E-commerce involves having physical stock or inventory, we don't really touch that, because you're going back into this risk thing where you're tying up all your capital in physical stock in a warehouse somewhere. So we don't do that. 

  

[00:15:26] But yes, we renovate every site with a set kind of formula. And so we do change it around. And that's a renovation opportunity that we're looking for, Tyrone. So it's like you guys look for certain renovation opportunities when you buy properties. That's what we kind of look for. We look at the site and go, 'Cool, but it's not set up the best.' We know we can come in and give it a lick of paint and hopefully get it converting better and driving more traffic. And hopefully, we can double the profits.

Tyrone Shum:   

[00:16:00] Yeah, absolutely. And I guess the question, maybe a lot of people might be asking is if the opportunity sounds too good to be true— you buy a site for $2,000, in a few years' time, it gets a passive income of about $20,000 a month, which is roughly about $240,000 a year, which is phenomenal. It's like a full time income. And then you go, 'Okay, how much time does it take? Where do you find these type of sites?' I'm sure there's a lot of these kinds of questions bubbling in people's heads. I mean, we don't have to go into too much detail about it. But I'm just curious, just from Lisa's perspective, how did she sort of found this kind of thing, just as looking [at] people painting that picture?

Matt Raad:   

[00:16:36] Really good question. And I should mention, that sort of a result is not typical. Lisa has hit the ball out of the park, clearly. And she's executed really well on this site. So the answer to your question is she did— we call it reps, reps, reps. She did the hard work at the beginning, she's a total beginner online. And everyone's super excited, including her, they're focusing on the now, which is, wow, they're blown away by the amazing amount of money she makes each month, but they didn't see the journey leading up to that. It's been three or four years that she's been working up. 

 

[00:17:11] So she spent a lot of time because she had to completely retrain in this field. She knew nothing about websites, how they work. So she had to spend a lot of time learning the process. And what we suggest is, if anyone's interested in doing this, learn on small little websites first. So there's zero risk. You can easily go and buy a website, we use a platform called flippa.com. There's heaps of website brokers out there now, though. 

  

[00:17:36] But you can go onto Flippa, you can buy a small little website under $1,000 and learn on that. And you can watch the results. You may or may not make money on those small sites, it's all about the learning process if you've never been online, and then you need to gently buy slightly bigger websites. We do not recommend, particularly for a beginner, going in and buying a big website straight up. But timewise, when you first learn this, it does take longer than you think. What's the study show, it takes you seven times as long to learn a new skill as it does once you know it. So that's the reality of the situation. You've got to do what we call reps, reps, reps in the beginning. 

[00:17:44] And it definitely doesn't happen overnight. Because in our game, it's always the exponential curve. We draw it at all our events and stuff. It's Matt's favorite graph, everyone knows Matt's graph. And because our backgrounds being Zoologists, and we learnt it at uni, it's a biological phenomenon. Things go along like flatline, and then all of a sudden, it's in that last period where things start to take off for you. That's very much what happens online.

 

[00:18:54] But when you get it right, and it does take off, it can go big very quickly as what Lisa found. But most people can't hack the journey along the bottom of the graph. They just won't stick it out. Whereas I think the good thing with property is, especially as we see in Australia, property tends to be more linear from what I've observed. Each year property goes up X amount each year. And obviously it does compound over the very long term. But with websites it's very pronounced. 

 

[00:19:23] So it's a really good question of yours. What's the reality? What has Lisa done here in the background? She's been working on this thing consistently and learning every... I'd say she works on it most days. It's not like it's an intense workday though. It's just she's kind of plodding along. She's just keeping an eye on her emails. She's got her outsource team. She'd have two or three people working with her on it. They're all outsourced. You can find them on upwork.com. I think she's got two writers and she's got a VA that helps her, a virtual assistant. And that's it. That's all she's got.

Tyrone Shum:   

[00:20:00] The thing is when you compare that to, say, property, property is very similar in the sense that you've got to have a property manager. I've got properties myself, and I still constantly get property managers contact me at least weekly to say, look, there's a repair to be done, maybe a tenant's moving out. And then when you're doing a renovation, that takes up a lot of time as well. I had a renovation that went on for about six months or so. That's pretty intense.

  

[00:20:22] So when you compare those it's actually very similar in that sense that you've got to put in the hard work at the beginning to be able to get the results that you want to achieve at the end. I have to say the last renovation I did, the property gained an equity of about $200,000. So I was very pleased with that. And that's the kind of work you still have to put in with the website. And that's what Lisa's done by the sounds of it. You put in that effort and you can generate that regular cash flow. And the asset itself, I'm pretty sure it's worth more than $2,000 now, but it does appreciate with the manufactured equity.

Matt Raad:   

[00:20:57] The cool thing with Lisa, what I really like about her is she's so focused. She knows she's on a winner here and so she's just stepped on the accelerator. That's the other thing too. So you can make these websites quite passive. And I do want to reiterate, those results aren't typical. What works really well, we believe, is having a portfolio of websites. Why? Because you can. It's a lot easier to own a portfolio of websites than it is to own a portfolio of real estate, because it's just so much cheaper. And some of them will work and some of them won't. 

 

[00:21:31] Now, everyone's obviously focused on Lisa's one that's working— she's got other sites that don't work as well. But if you have, say, 10 websites, and each one makes anywhere between $100 a month to a couple of thousand dollars a month, that can very quickly add up to a six figure income, which for most people gets them out of their job. 

 

[00:21:49] And that's what our goal is, that's what we try and help people do. Like I said, we try and help people who are in PAYG and they want to get out of there. They're working too many hours, they're missing their kids. And so our goal is always to help people do that. And we like to get people to do it safely as possible, which is by owning, ideally, a variety of websites. Because there's no guarantees. They do have problems and stuff just like any. They're a little mini business, but they're little cash cows. 

  

[00:22:18] And what we've noticed is, and it came from our portfolio, that's how we started. Because we used to do this with businesses, bricks and mortar businesses. And so we just do the same now with websites. It's a lot easier with websites to own 10 websites. Some only make a couple hundred bucks, some will make a couple grand, some will make tens of thousands. And that's per month. So you're constantly managing and working across them. 

  

[00:22:44] And then you might sell some and flip them up into bigger deals. And that's a very effective strategy now in this rising market. Tyrone, you should see the deals that are happening out there now. Oh, my goodness, like people flipping websites. We never used to be big into the flipping websites thing. But now in a booming market, I can definitely see the benefit. I've become a big fan of it. 

 

[00:23:09] So you can build good websites, if you've got the skills. And you can be flipping them into bigger and bigger deals. And we just did this cool interview with one of the world's best website brokers, his client, within five flips, turned a $2,000 website into $9 million. Took him about five years.

Tyrone Shum:   

[00:23:34] Wow. That is a wow, to build a portfolio, a $9 million portfolio is going to take more than that time. 

Matt Raad:   

[00:23:44] It's just phenomenal. And we're speaking to all these brokers because it is hot. The brokers are approaching us and saying, 'Hey, do you have clients that want to sell websites?' Even small websites are selling for a lot. So this guy that did this, his first site he bought for $2,000. He's built it up doing exactly like what we teach, just adding content, sold it for $7,000. And then he used that money to buy another website, sold that one for $20,000. 

  

[00:24:16] He was a beginner and he learnt how to do it. So of course then you can take on more risk. So he bought a much bigger website and sold that for $200,000 and got really good. And by then he had his whole team together, then just got so much easier. And that's when he did the next website. He bought a much bigger website and sold that for $9 million. This just happened just recently. Sold it for $9 million, which is a record. It was just stunning. 

  

[00:24:43] But the thing is knowledge is compounding, and we're in a booming market. So once you know what you're doing— I feel like Lisa now, that's why she's gone out and bought another website, because she loved that story. She's hugely inspired by it. She said, 'Matt, I'm gonna do exactly that.' But once you've got these skills, it's like if you're good at property, it's the same thing. Once you've got the skills in property, you can just keep going. And the only limitation you've got is getting the money to buy bigger and bigger properties. 

  

[00:25:15] And that's the other interesting thing, Tyrone, it's changed since we last spoke. In our market now when it comes to raising funds, it's a lot easier. You still can't go to the bank to raise lots of funds. But there's lots of private aggregators out there, and they're throwing money at website deals. Because they're kind of a no brainer. They operate 24/7 since COVID. Everyone's suddenly realised, ‘Oh, well, these website businesses are brilliant. They just operate 24/7 and there's more traffic online now so they make a lot more money.’

Thank you to Matt Raad, our special guest on this episode of Property Investory.

Also for being a loyal listener of the podcast, I’ve asked Matt and Liz to provide a special offer for their Digital Profits Program that can show you how to buy and renovate cashflow websites. Simply visit PropertyInvestory.com/onlinecourse/ to claim your offer.

When you sign up, you get access to an exclusive training in buying positive cash-flow websites and building an online portfolio that generates income from automated sources. I’ve personally watched these videos and highly recommend learning from Matt and Liz as they are the experts at this.

To claim this special offer, visit PropertyInvestory.com/onlinecourse/