Successful Realtors / Brokers tend to lean towards building an offline cash flow portfolio — rental homes, residential flipping or even dabble in commercial real estate.
Wild idea: how about allocating two closings worth of cash for an online asset?
Real estate investing will always be my first love. I grew up watching my father buying, renovating, leasing and flipping 25-20 homes; I’ve owned a couple of my own the past 5 years.
But lately I’ve diversified to online assets. I couldn’t resist the 15-20% per year return on my investment. For most online business models, maintenance is minimal after a year, costs are manageable through efficient small business outsourcing and imagination, creativity is put into best use.
Mind you, it took me a full 3 years before I put serious money into it. In those 3 years my sole purpose was to incrementally improve my knowledge. When I started earning cash flow (however small) then I aggressively re-invested my profits back to the business.
Here are some things I’ve learned: 4 ways to make money from a website
1) Leads (ex: niche real estate sites.)
2) Adwords / Adsense (people clicking on your site’s ads. Need a LOT of traffic. Like EHow.)
3) Sponsored ads (would be helpful if you had a good ground game — sales guy, good relationship with people in vertical businesses and most importantly, good branded site that attract good traffic and loyal followers. Ex: Copyblogger)
4) Affiliate (selling someone else’s product. Make sure you get the best product to sell. Tough market to crack but can be very lucrative after you gain credibility and strong following. Ex: BBgeeks.com, affiliate for blackberry phones)
- Start with something you love and have adequate experience in, be it pink gems, creating an Expat site for Americans in South Africa or creating the best exotic Asian cuisine site. There’s so much stuff to do to build a great site, so make sure you like the topic. And know it’ll take at least 1 year to really earn money, usually more. It’s a marathon.
- I’m all for action over too much analysis. But if you are really serious about an idea. Create a solid simple plan backed with solid knowledge of online marketing (SEO, PPC) — start reading the top SEOs, Affiliate, PPC (pay per click) guys out there. If you go with the brand route (Yelp, Yahoo!, HomeAway) make sure you know what you’re getting into. It’s extremely hard to create a solid brand from scratch.
- If you got no time but have capital. Learn the business model and a clear understanding of what you want to do. Outsource day to day management of site (link building, content creation, coding). But keep a close eye on your baby.
- Have an “exit mechanism” to face the brutal fact that the idea, however exciting and fun, is unprofitable. Move on to the next one, you’ll have a higher chance of success, I promise you.
There’s so much great ideas out there, but the real money is made in the execution of the idea. Follow through. Incremental improvement. And your $10,000 investment can earn you about $1,000 – $3,000 a month after 3-5 years.