Justin Cooke

July 14, 2014

Welcome to our Monthly Business Report for June, 2014.

Over the last couple of months we’ve been focused on cutting out everything in our business not directly related to buying and selling websites. We’ve cut our Products & Services, our niche site building, our plugins, and have been losing (or selling) pieces of our outsourcing company.

It’s a risky move to cut out additional revenue streams, but we finally started to realize some of the benefits in June. We’ve more than doubled our previous best with $197,900.93 in websites sold! We’re hoping we can keep that pace up and it’s looking good with more than $80K worth of websites sold in July (as of the 10th.)

We continue to publish these reports to both inspire you and to document publicly our successes and failures. These reports provide introspection that forces us to take a long, hard look at what we’re doing and gives us a journal we can refer to that tells the story of our journey along with successes and failures we’ve made.

Having to take an open and honest look at our strengths, weaknesses, and growth opportunities (along with the feedback you deliver) provides us insights into our business we wouldn’t have otherwise. It gives us an opportunity to look at our business from the outside in, and (hopefully) leads us to make better-informed decisions about the direction our company should take. To be clear:

Most of the revenue comes from you.

Whether you’ve bought or sold a website or business with us, we wanted to thank you for your continued support as we continue to expand our online empire.

What We’re Working On

Some of our best additions have come from listening to our customers

Some of our best additions have come through listening to our customers and executing on the advice or requests they’ve made. We’ve been a bit slow to react to feedback in the past. To correct this, we’ve been proactively getting on the phone with our buyers and sellers and giving ourselves (as partners) the autonomy to make broader changes without meetings, reviews, etc. The goal is to be a tighter, more nimble team that can quickly react to changes and feedback in our market.

Here are a few things that we’re working on related directly to your feedback:

1. Empire Workshops: Meeting with buyers and sellers in cities around the world

We talked about this in our recent podcast on Wholesale Vs. Retail marketing. The idea is to meet with potential sellers and buyers in a workshop setting where we can walk them through the process of buying and selling sites, share actual case studies on successful and unsuccessful website sales, and offer business breakdowns and valuations to attendees.

We’re starting in Ho Chi Minh, Vietnam on August 7th with a plan to do another in Chiang Mai, Thailand in early October.

Depending on the success of these first two workshops, we’d like to expand to Australia, the US, and beyond.

2. Expanding the range of our websites and businesses for sale: $10K – $500K

Having previously sold smaller websites and packages ourselves, we figured the buyers in our audience were primarily looking for smaller websites to acquire. This was dead wrong.

In talking to some of our previous $50K+ buyers and prospective buyers, we quickly found that they’d love to buy higher-end sites from us if we had them available. In fact, several have made $200K acquisitions before through other brokers and marketplaces. We’re leaving money on the table if we don’t offer them sites in this range.

3. Investment and portfolio management services

While many of our websites for sale have limited hours required for maintaining the sites, the work required to actually grow and expand the sites can be more significant. Some of our buyers have asked us to provide a service like this in the past, but we haven’t yet put something together here. In Episode 92 of our podcast, we introduced the idea of partnering with us on some of these acquisitions and I sent out a “napkin math” email about it to some of our buyers.

The replies and responses were overwhelmingly positive.

As part of our relaunch coming in the next few weeks, we’ll be offering this investment partnership to select buyers on select websites. If we can offer a more passive engagement to our investors where we take on the work and share in the profits, I think we’ll have a real winner on our hands for all involved.

Alright, time to dig into June’s Numbers:

Traffic And Audience

Here’s a detailed look at our blog traffic, podcast downloads, and list growth in June 2014.

Blog Traffic & Analytics

We’ve seen a nice spike in traffic for June that took us up to 28,663 visits – nearly 5K more than the previous month!

June's Traffic Numbers

While we received a 27% bump in organic traffic in June, the spike you see in the first half of the month came from some Reddit traction and hitting the first page of Hacker News with our post about getting sued in the Philippines.

Let’s take a look at our top content for June:

Losing A Lawsuit In The Philippines
Paid Ads Case Study: Retargeting Vs. Facebook Ads Vs. After Offers
AdSense Account Disabled – What To Do?
The Problem With Flippa

Empire Flippers Top Content in June

Seeing our marketplace and individual listings getting so much traction shows that we’re on the right track and that we’re heading in the right direction in targeting buyers and sellers.

Here are our top referral sources and the email subscriptions from each in June:

Empire Flippers Referrals for June

The traffic from TropicalMBA and Cloud Living continues to convert to email subscribers well. I was really interested to see how all of that Hacker News traffic converted, but the traffic shows as direct traffic instead of referrals. Here’s a look at how that played out:

HackerNews Conversions

Wow – only 5 conversions on June 11th out of 4,792 visits! While we appreciate the additional exposure, it’s pretty clear that there wasn’t a great match with either the topic of the content or the visitors coming from HN.

Podcast Downloads

With only 3 podcasts published in June, we took a bit of a hit at the beginning of June and only pulled in a total of 13,643 downloads:

Empire Flippers Podcast Downloads in June

Luckily, our interview with Jordan Harbinger was popular and bumped the numbers back up at the end of the month.

It’s a little frustrating that iTunes only allows you to download the last 50 episodes we’ve published and we’ve had a few requests on Twitter asking for the first 50 episodes. We’re working on this – we’ll soon be offering a zipped file that contains the first 100 episodes of the podcast for you to download.

If you happen to know a better fix for this, please let us know in the comments!

Emails & Contacts

We continued to grow our total contact records to 16,977 by the end of June:

Our Contact Records in June

After accidentally culling our email list a few months ago, we’ve bounced back and ended up with 9,952 active subscribers as of June 30th. Some of the paid traffic sources mentioned in our case study have been paying off in terms of subscriber growth, but we’ve cut down on almost all of our paid marketing efforts until we get our new brand and redesign launched in the next few weeks.

Monthly Revenue

Let’s take a look at our different revenue streams to see how they turned out in May.

Brokered Site Revenue

We really had a breakthrough month in June with a total of $197,900.93 in websites sold

We really had a breakthrough month in June with a total of $197,900.93 in websites sold – more than double our previous best month! This led to a total of $29,313.31 in revenue for our company.

Here’s a look at our all-time numbers for brokered websites:

Marketplace All Time Chart June 2014

And a look at our month-by-month growth that led us here:

Marketplace Monthly Chart June 2014

We’re off to another great start in July and we’re hoping we can continue the momentum as we launch our new brand and marketplace.

Our goal was to hit $2MM in sales by the end of 2014 and we’re currently sitting at $620,966.60 through June 2014. If we can average better than $200K per month through the rest of 2014 we’ll hit our goal. As we move into listing sites in the $100K to $500K range, we’ll have a much better chance to hit and even surpass the goal we set at the beginning of the year.

Website Listing Fees

Since we’ve removed our Products & Services, I’ll now be reporting on the listing fees we charge to review, vet, and list new websites for sale. We brought in a total of $1,382.00 for listing fees in June.

First-Time Listings: 4 @ $297 = $1,188.00 total
Repeat Listings: 2 @ $97 = $194.00 total

This doesn’t count any listing fees we charged and refunded because we couldn’t accept the listing.

If you’d like to hear more about how to list and sell your website with us, please click here.

Outsourcing Clients

We’ve continued to wind down our outsourcing company and only had $10,762.02 worth of revenue for the month. With a major client wrapping up their contract with us, we’re looking to divest the rest of our outsourcing operations over the next few months.

While we’re keeping our current team, we’ve been exploring ways to offload the Philippines corporation and operate only through our US corp.

We’ll be increasing our team’s pay across the board, but we’ll also be cutting benefits, remittances, taxes, and 13th month pay. All of that will still be available to our team, but they’ll have to take care of it themselves (with the help of an admin assigned specifically to help them.) We met with our attorney in June to explore how to do this.

The net benefit to our team is positive in that they’ll earn more individually and we’ll be cutting down both our liability and the headaches/hassles that come with local payroll.

This is also important as Joe and I look to spend more time outside of the Philippines and meeting with other entrepreneurs, customers, readers, and listeners around the world. Wiring payroll once a month and cutting out local contracts and expenses will remove any requirement that we remain local.

Our Sites

We still hold a small portfolio of websites we’ve built ourselves, but we’re looking to sell the bulk of these off within a month when we launch the new redesign. Our sites brought in a total of $1,261.43 for June with an expected value of around $25K.

Additional Revenue

We brought in $660.20 worth of affiliate commissions with the bulk of that coming from sales of Long Tail Pro.

Sales of our WordPress theme (IntelliTheme) brought in $485.00. We’ll likely be selling this property within the next couple of months.

We sold one copy of WP Rank Tracker for $47.00 in June. We’ve recently given this plugin away to our friend David over at Fat Cat Apps.

Our Amazon eBook sales for Building A Niche Site Empire brought in $86.26 in June.

We also brought in an additional $90.00 in hosting fees and $334.24 to help with a website migration.

Customer Experience

One of the reasons for bringing out another apprentice (Our Marketplace Manager position) was to significantly improve our interaction with customers and the buying/selling experience overall.

While Mike will be joining us at the end of July, we’ve been working on revamping some of our backend communication tools and processes to help set him up for success. We’ve setup and implemented communication tools like Slack, tracking tools like Time Doctor, and process tools like SweetProcess so that we can further streamline and improve the customer experience.

Zendesk Support

We’ve been really working with our “Customer Heroes” on improving ticket times and providing better service to all inquiries, depositors, buyers, and sellers.

We now have support staff available 24/5 and have around 18 hours per day covered on Saturday/Sunday as well. Live chat is available on select pages like our marketplace and featured listings.

We tend to have lower volume, but more-involved tickets for every transaction so our best benchmark was looking at how we compared to companies with 1-9 employees. I’m really happy with how June turned out, with only a first reply time of 2.9 hours for the month:

Zendesk June 2014

We’ve really been focused on improving our customer service the last two months, so it’s an interesting comparison to look at how we did in March/April:

Zendesk Mar and Apr 2014

Vs. our numbers in May/June:

Zendesk May and Jun 2014

Even with a 28% increase in the number of tickets created, we improved our satisfaction scores from 93% to 97% and decreased our first reply times from 19 hours to 6 hours. Awesome!

I’ve seen some slippage in terms of reply times in July, though, and it’s something we’re working through. I’m really disappointed that we ONLY have reporting on first reply times in Zendesk though, because many of our tickets require much more back-and-forth than just the initial inquiry. I’ll continue to look for ways to report on this, but if you have any Zendesk suggestions we’d love to hear them!

Customer Feedback

We review all of the feedback our support team receives and are regularly looking for ways we can improve.

Here’s a look at a feedback from a satisfied website buyer:

Good feedback from buyer

And another from a different website buyer. (Even though our broken marketplace accidentally re-listed the site he’d just purchased – oops!)

Good Feedback From Buyer 2

That’s not to say all feedback is positive, though. While we had a 95% satisfaction rating in June, here’s a look at some of the more critical feedback we received:

Bad Feedback 1

While Zendesk has been a great help at keeping our team organized, it appears the stacking of tickets as a massive email string can be a bit irritating when there’s lots of back and forth.

Here’s a look at some critical feedback (and my response) from someone looking to purchase a website for around $5K:

Bad Feedback 2

While we do get some listings under $10K, they do tend to sell awfully quick and it goes to show the market is still there for lower earning sites.

We’ve noticed a change from site builders and sellers, though, in that they’re more likely to hang onto sites that are earning $200 – $500 per month until they get up to around the $1K per month range. They’d rather hold them longer and build them out further for a bigger payday.

Case Studies

We’ve had a rush of seller case studies posted around the web recently that we wanted to highlight. These have been fantastic for us in that they raise awareness for builders looking to sell their sites and provide an excellent alternative to selling on Flippa.

Doug’s guest post on Authority Website Income on selling his site for $10,400. This is a really in-depth post and worth reviewing!

Hieu Nguyen’s guest post on Cloud Living about selling his site with us for $17K.

Josh from Form Your Future had an additional $19,980.40 on his June income report because of a site he sold with us.

Greg’s post on No Hat SEO about selling his site with us for $16K.

This additional exposure has been great for us in attracting new potential sellers to listing their sites with us to sell on our marketplace.

Summary

We’re extremely happy with how June played out and feel like our focus on side-projects and revenue streams is finally starting to pay off. The hope is that our singular focus on what we feel is our best value proposition to the market will allow for massive growth as we wrap up 2014 and head into the new year.

Here’s a look at all our revenue streams over time:

All Revenue Chart June 2014

And here are those same revenue streams without the outsourcing revenue:

Revenue Without Outsourcing Chart June 2014

June 2014 Business Data:

  • Employees: 28
  • Apprentice: 1
  • Contractors: 3
  • Contact Records: 16,977 (As of 6/30)
  • Email Subscribers: 9,952 (As of 6/30)
  • Site Visits: 28,663

Earnings:

  • Brokered Sites: $29,313.31 ($197,900.93 in vetted sites sold)
  • Listing Fees: $1,382.00
  • Outsourcing: $10,762.02
  • Our Sites: $1,261.43
  • Additional Revenue: $1,702.70

TOTAL: $44,421.46

“New – Monthly Business Report for June 2014 from the @empireflippers!” – Tweet This!

How did your June work out? Did this give you any ideas you can use to improve your business? Any suggestions for improving ours? We’d love to hear from you in the comments!


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Discussion
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  1. Dom Wells says:

    There’s something incredibly satisfying about reading your monthly reports. I think it’s the fact that you’re dealing with such a large scale business (compared with a lot of other income reports) and yet manage to keep it so down to earth and honest.

    I think it makes the dream of having an online empire that much more perceivable for all of us.

  2. Justin, you mentioned that you may sell Intellitheme soon. I just bought the theme today and i’m thinking if you sell it to the right company it could be a great thing for updates etc? Is this still the best theme for adsense sites? Is it what you and your clients currently use? Thanks in advance! Best, MT

    • Yes, we will be selling IntelliTheme.com next month as an offering on our new martketplace. I agree, in the right hands it could be an awesome theme. And yes, we still use it on all our niche sites plus have many clients using it long term.

      • Thanks Joe, I just wanted to see where it stands in your eyes as of now. It looks very useful and unique as is and i’ll be trying it out right away. But yeah it would be awesome if whoever buys it kept developing it!

  3. Great month guys, you’re heroes :)

    I followed the whole “WP Rank Tracker” lifespan, from your acquisition to giving it away.
    In my eyes it was an unlucky investment (as the “not provided” change in Google made it 99% useless) but I wonder what you guys think about it.

    Ciao!

    • Agreed Daniele, it was just unfortunate timing. Hopefully David can turn it around by using Webmaster Tools.

      In the end, we didn’t lose money, so I can’t complain.

    • Justin Cooke says:

      Thanks, Daniele!

      Yeah – I think WP Rank Tracker was bad timing. I really think we would have crushed it with that “strategic purchase” of ours! As it turns out, I think we broke even or made just a bit on the purchase? (Which is actually a loss when you think about it…with the time/effort put into it) Still…would definitely take that opportunity again.

      • Thanks both of you guys for the reply!
        You guys have the exposure (= marketing channel) to promote any good product out there, so buying it was definitely a good strategy to maximize profits.

  4. Raweewan M. says:

    Great report! I’ll see you in Chiang Mai. :)

  5. Dan Norris says:

    Great stuff guys, could be a turning point eh?

  6. Great job as always… I’m a bit surprised about the divesting .. but I guess it will allow you to be more laser focused…

  7. Great stuff, but whomever told you to focus on the marketplace and divest everything else is crazy, you should be focused on Intelitheme fosho!

    • Well, you ignited the inner hammer in me — shedding staff and distracting side projects. I only wish we could do it faster, but good things come to those who wait. I hope!

      IntelliTheme will soon be for sale on the marketplace unless you want first dibs Damian! ;-)

  8. Josh Escusa says:

    Awesome month guys. And thanks so much for the great experience with selling my site. You’re now my go to method of selling sites so expect to see many more from me in the future :)

  9. Ryan Kaufman says:

    You guys are rocking it! Great Month and loving all the details.

  10. James Michael Andrews says:

    Exciting times ahead!

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