EFP 177: 5 Predictions For 2019

Without the use of a crystal ball, making predictions is a difficult business.

It’s hard to account for, say, market conditions that are outside your control.

Still, by looking at some of the trends in the industry over the last 12-18 months, we can put together some estimates that we can then use to guide our decision making in the months to come.

In this episode, Joe and I dig into some of the trends we’ve seen through 2018 and make some predictions we’ll use to guide our decision making as we head into 2019. We wanted to share those predictions with you as well in the hopes that it helps you make decisions that will lead to a profitable year in your business.

With an ever-changing financial landscape, we look at both sides of the coin – what we believe will happen with either increasing or decreasing markets. That single factor can dramatically shift where you might be deploying capital as you head into 2019 and beyond.

If you’re into data-driven analysis and predictions about our industry, you’re going to dig this episode!

Check Out This Week’s Episode:

Direct Download – Right Click, Save As

Topics Discussed This Week:

• What will happen to multiples?
• What kind of capital available in the $1M – $5M range?
• Real brands vs. no-brand businesses
• Single-channel vs. blended eCommerce companies
• Closing $5M+ listings

Mentions:

• EF Listing # 45156 an Affiliate Site along with Amazon Associates In The Diet Niche
• DMSS Conference
• Dynamite Circle Bangkok Conference
• Dropship Lifestyle Retreat
• Chiang Mai SEO Conference
• Real Money Real Business Podcast

Spread the Love:

“The market is getting more sophisticated and those single product businesses just aren’t as attractive.” – Justin – Tweet This!

“At the end of the day, if you have the listings the buyers will follow.” – Joe – Tweet This!

What are your predictions for 2019? Think we’re on point or out to lunch? Let us know in the comments!

Justin:
Welcome to Empire Flippers Podcast episode 177. 2018 has been a real growth year for the industry. Joe and I wanted to take some time to review some of the trends we’ve seen and use those trends to make some predictions for 2019. Now, we don’t have a crystal ball, but there are some specific takeaways that should leave you with some great ideas how to into the next year. You’ll find the show notes for this one at empireflippers.com/2019. All right, lets do this.
Automated Voice:
Sick of listening to entrepreneurial advice from guys with day jobs? Want to hear about the real successes and failures that come with building and online empire? You are not alone. From San Diego to Tokyo, New York to Bangkok, join thousands of entrepreneurs and investors who are prioritizing wealth and personal freedom over the oppression of an office cubicle. Check out the Empire Podcast. And now your hosts, Justin and Joe.
Justin:
All right, Joe, before we even get started with this episode, man, I just want to ask you how likely do you think it is that these predictions are going to leave us with egg in our face the next year?
Joe:
Fifty-fifty.
Justin:
Fifty-fifty, I thoughts only in the Philippines you get that answer a lot. What’s the likelihood, I don’t know fifty-fifty. Fifty-fifty [inaudible 00:01:10]. I’d hate to, I mean there’s a non-zero chance that these are going to blow up, but we have seen some real trends in 2018 and we’ve taken some time to like dig through kind of the goings on of the year and there are some insights I think we can takeaway. We want to share that with the audience.
Joe:
Yeah, I mean I think we picked up a lot of insight over the past couple of years actually and making a prediction, I feel more comfortable making a prediction now then I did two years ago let’s say.
Justin:
Yeah, I think we’ve taken more market share, we’ve grown enough where we’re doing enough deals now to where we have a significant amount of deals and we do have the pulse of the market to some degree and I feel more confident in talking about it as well.
Justin:
Something I want to discuss, I really couldn’t fit it into the episode but there’s a lot of chatter around right now, it’s a very immediate thing, but there’s a lot of talk around taxes and tariffs and what that’s gonna mean for our industry particularly regarding eCommerce.
Justin:
You know at the end of 2018 and heading into 2019, I wanted to talk about that a little bit. Joe you have some thoughts, I know you’re a, you’ve been talking about this a lot.
Joe:
Yeah, I mean, look I don’t think it was a great idea to do the tariffs but I don’t think tariffs are gonna have the intended implications that some buyers think they will have. I think a lot of sellers out there, a lot of operators, a lot of entrepreneurs are very savvy, they’re going to find a way either around the tariffs or a way to go to another country and another source to get their products.
Joe:
I mean, I saw, and stick with me on this, I saw a documentary on honey and where honey comes from in the United States and what not and how a lot of honey’s being illegally imported from China from Eastern Europe. So you know there are ways to change labels, there are ways for manufacturers to get around these kinds of things and avoid having to pay those things. And because we live in such a global society today I think that the tariffs can be very, very tough to implement on the lowest levels.
Justin:
Dude, you got me on a rabbit hole now. Like the bees man, what happened with the bees, did those ever come back, like what’s the deal? Have you read up on that Joe? Any podcasts about the bees are they.
Joe:
Sudden bee colony collapse [crosstalk 00:03:17] Justin:
Are they back?
Joe:
They’re not fully back but I think they’re better than they were before. I actually watched a whole documentary on that too and now they know where it’s coming from but that’s for another time.
Justin:
I meant to check in with my bee expert on that one and get back to you. Well one of the things that’s not problematic with eCommerce, I mean the shipping products from China, I mean all their competitors are going to have the same problem right? So they’re shipping product, I mean everyone they’re competing with in that same category is their import costs are going to go up as well, and that’s generally be passed onto the consumer. If your competitors are doing it, you’re doing it, I think you know across the board on average its be okay.
Justin:
Another thing too I think a lot of people will do is they’ll simply re-categorize their product right? So you know there’s a slight change, you change one of the numbers and all of a sudden you’re in different category and not taxed or tariff ed. I think you’re going to see some of that as well.
Justin:
One area I think is problematic Joe might be the drop shippers from China. So like the Ali Baba Express guys that are simply buying and shipping direct from China with like the cheaper products. I think, we’ve seen our buyers mostly rejecting those types of businesses in 2018. I’d imagine that’s going to continue in 2019. It’s also problematic for them competing with the people that have already shipped the product and have like you know a much faster lead times from the US and I think those businesses are going to continue to have issues.
Joe:
It’s interesting how it’s going to turn out but it’s definitely, it’s not going to kill imports from China. There’s gonna be other overseas manufacturers to deal with. There’s going to be ways around it like you said. Like they get another a 2019 version that uses different parts, different sources material so you know it’ll be interesting but I don’t think it will kill us.
Justin:
All right man, another thing we’ve been talking a lot about in 2018 are you know the kind of global economic impacts right. So if we see continued economic growth versus recession what might that look like and how might that change things for our industry. And we’ve talked a lot about this kind of privately and we wanted to air those conversations.
Justin:
We’re going to get into that toward the end of the episode so if that interests you make sure you stick around. I also just want to talk about how you see the economy changing. It’s really gonna matter on the decisions you make in 2019 right. And again there’s no crystal ball, no one knows for sure but if you have you know strong feelings one way or the other, you’re gonna want to make different decisions in terms of what you’re doing with cash, where you’re deploying it, that kind of thing.
Joe:
Yeah I definitely think there could be some challenges for the economy in 2019. We did hit a little bit of a rough spot in October of 2018, seems to have bounced back quite nicely. I will see how that continues into 2019.
Justin:
Alright man, enough about that it’s time to pay the bills. Let’s talk about our featured listing of the week.
Joe:
We’re talking about listing 45156. This is an affiliate site, along with some Amazon associates. It’s making about eighteen thousand a month net, and we have it listed for just over six hundred thousand dollars. It’s in the Dietrich and I think that this is really one of those sites with a very clean SCO profile something that you can get into and obviously replace your income very quickly but also be confident that it’s going to be there longterm.
Justin:
Yeah the growth on this website had been really, really solid. They’ve got a really solid back profile which we encourage our listeners to go check out and dig into. I think this one’s going to be a solid purchase for someone, kind of a longterm. Website for their portfolio and it’s definitely earning at nineteen thousand dollars a month. So a really good pick up, expenses are low on this one raising a seven month average determined the average net profit. Definitely worth taking a look.
Joe:
Yeah has a little bit of seasonality obviously because it’s in the Dietrich but I think that could be mostly taken care of, especially now that we’re going into the kind of New Year’s resolution phase.
Justin:
Alright man let’s dig into the heart of this week’s episode.
Automated Voice:
Now for the heart of this week’s episode.
Justin:
Alright Joe we’re talking five predictions for 2019 and I’ll just note at the top that these predictions are gonna assume that the economy continues to grow or at least stay stable. We’re going to have some thoughts at the end if that’s not the case. So if you see a downturn in the global economy or the economy in the US in 2019 we gotcha covered there too.
Justin:
Alright man the five points the first one is multiples are going to go up overall. Now this is across the board from small sites to big sites, from eCommerce to drop shipping to Kindle Ebook businesses. We see buyer growth outpacing the quality sites and businesses that are being listed.
Justin:
It’s a simple supply and demand issue, we’ve got more demand then there is supply and we don’t see that slowing down in 2019.
Joe:
Yeah I absolutely think we’ve seen this year to year and it’s gonna continue to happen. You know there are a lot a people out there that are getting into the online business space. And a great way for them to jumpstart things is to buy their own business so you’re only gonna see more of those people getting in and obviously from a demand side that’s going to drive up prices.
Justin:
So let’s talk winners in 2019. I see businesses that have a solid brand, they’re known in the space, people are coming back to them or going to them because of the brand. I see those being big wins. I see businesses or websites that have diversified traffic or diversified products or diversified sales. I see them being big wins in 2019.
Justin:
Losers I think we’re looking at kind of the single source traffic or the single product businesses. They’re very simple to set up but I think they’re going to need to be expanded. The market’s getting a bit more sophisticated and those kind of single product or single channel businesses just aren’t as attractive and are become even less so in the coming year.
Joe:
Yeah and that’s not to say there’s not a market for those types of businesses I just think it will, the multiples won’t grow as fast as they will do for the solid brands diversified type businesses.
Justin:
Alright Joe, our second prediction, more money available and the one million to five million dollar range. This is, there’s a host of reasons for this, we’re gonna go through them. One of the reasons is that SBA loans are going to continue for applicable and qualified businesses. Any business that you know qualifies for an SBA loan, I think SBA will continue to open the purse strings a bit. There’s going to be more opportunities for people to get SBA loans through 2019.
Joe:
Yeah, I mean rates went up slightly in 2018, although the Fed refused to raise rates again here recently, so I don’t know if rates will go up again. But even where they’re at, it’s still a very comfortable interest rate to get into for an SBA loan. So I think that plus the qualifications being generally pretty broad, unless you’re a foreigner obviously outside the United States that makes it impossible.
Justin:
Now, that really applies to SBA businesses, but we do a lot of deals that either aren’t SBA qualified or can’t qualify for SBA because they’re foreign owned or they’re foreign business or don’t have tax returns. So let’s talk about other reasons for the 1.5 million dollar being available.
Justin:
Another reason would be we’re seeing a real increase in 2018 of these cashed up micro-funds, and our prediction is that in 2019 these guys are going to be letting go of the purse strings, they’re going to be opening up their wallets to buy some of the businesses that they’ve been kind of prepping for in 2018. And Joe, we just came off the conference circuit, we talked to a whole bunch of people that are either part of these funds as investors or they’re operators running some of these funds. And these are generally like 10 million dollar up to a hundred million dollar funds that are being created.
Joe:
Yeah it’s pretty amazing, and I think, another thing to note is that these micro-funds are having success with their initial tests in 2017 and 2018 and now they’re really, you know ready to let it hang out and kind of go for larger deals and so that’s why you’re going to see them getting into these kind of bigger deals and doing them more frequently.
Justin:
We’ve seen a lot of them set up in specific verticals too. So you have these micro-funds that are specifically looking for like ads and affiliate type sites. You have the specific vertical FBA businesses that are purchasing solely FBA businesses. They’re purchasing just eCommerce, traditional eCommerce businesses. So they’re really kind of going vertical by vertical which I think is pretty interesting.
Justin:
Another thing is there a lot more private equity groups that are starting to dip below the 10 million dollar barrier. It used to be, you know in 2017, 2016 that kind of 10 million was kind of the limit they wouldn’t go much below that. We’ve seen them going below that in 2018 down to six, down to seven, down to eight million dollars. We’re expecting to see some of that below five million in 2019, so we expect these private equity groups to go even lower down the three, four and five million dollar range.
Joe:
Yeah, again I think they’re starting to see other people have success there and they realize that it is worth it to get out of bed in the morning for less than five million dollars. So that’s good thing for the industry, I think there’d be more sophisticated money getting in there. Guys that are willing to act quickly for the right type business and scoop it up.
Justin:
We’ve noticed this because of the second half of 2018 where as; they weren’t interested in many of our listings previously, they were like oh just a little too small, let me know when you have a bigger deal, let me know when you have a bigger deal. They’re now looking at some of the two, three, four, five million dollar deals that we have on the marketplace and starting to like dig through them so they’re seeing some opportunities to go lower and if that continues in 2019 that would be good for us, it’d be good for our customers and I think just a lot more money in the 1.5 to five million dollar range.
Justin:
Another thing is, and this is less coordinated than kind of the micro-funds but we’re seeing just more investors pooling their money and creating like a pooled funds approach to buying like singular businesses. So there’s a problem we’ve talked about this before like in two, three, four million dollar businesses where you know one person doesn’t typically have the cash to buy the business. They have to pull from other funds, or pull from other investors. And we’re seeing that happen a little more naturally now rather than just kind of, we’d see it once or twice, we’re seeing more and more people do this and find each other.
Joe:
Yeah I think this is a great point because I called these investor groups right where the group goes out, they find an operator, they know what kind of business they want to buy or what type of portfolio of businesses they want to buy and they go ahead and deploy their money in just that area.
Joe:
They know that they can get very good returns and they have a lot more control over their money than they would in traditional type investment.
Justin:
And I say this is different from the micro-funds, because the micro-funds are typically looking to buy multiple businesses. There’s a more formal structure in place. Where these are a couple of investors that typically just looking to buy one or maybe two businesses, it’s not set up as a fund and they’re just kind of going in together and just less structure together.
Justin:
Alright man let’s talk about the third point a real brands will be what buyers are looking for. Now this isn’t really news and it isn’t really new but I would expect this trend to continue in 2019. The businesses that have a real brand that stand out in their industry, that have the kind of brand that people come back to and buy again and again. These are the types of businesses that people want to buy.
Joe:
Yeah, I mean it’s been true before, it’s getting more and more true that people love to buy a brand. It doesn’t have to be Nike but it definitely has to be something that there’s a little bit of a following for, that has some sort of unique product or interesting branding and has a following of some sort of group.
Justin:
Conversely it’s going to get worse for the non-brands when buyers are comparing one business to another and apples to apples comparison, right?
Justin:
So if you’ve got you know one business at a 28 X multiple and it’s a solid brand, people know the company and are working with it regularly. You’ve got another one that’s at a 28 X multiple or even slightly less, let’s say 25 X but doesn’t have real brand attached to it, you know the customer’s aren’t coming back, it’s always one off. Typically those customers are more expensive to get, they’re not retained and buyers are just less interested in that business. So even if they’re paying a higher multiple they’re just more likely to buy the business that has a brand attached to it.
Joe:
Yeah I mean if you have that garlic press single skew FBA business it’s going to get harder and harder to sell that and definitely at a reasonable multiple because it’s just not something that other people are very proud of owning.
Justin:
Yeah, this is true too but together with solo buyers when you have like the micro-funds they don’t care so much typically but even with a single buyer or partnership where they’re buying a business they don’t want to buy a business that’s just not interesting. That they don’t want to have their name attached to particularly or it doesn’t have a brand, they want to build something that they can be proud of and they want to be a part of that business and really expand the marketing efforts.
Justin:
So you know we have a lot of buyers that go through listings. This isn’t every buyer but we have a lot of buyers that go through and say, you know what I don’t see that being something that I’d be interested in, like I only see that being something that I’d be proud of owning right and I think pride in ownership is something sellers think about.
Joe:
Yeah they want to be able to talk about it at a cocktail party right? And be very proud of it, be able to talk about it in length and get into it. It’s not that they’re embarrassed to talk about a non-branded business but it’s just not as interesting.
Justin:
Alright man, number four more blended eCommerce businesses are going to be listed and sold in 2019. The market for buying and selling businesses and brands is maturing, right? And a lot of the shop owners, the eCommerce business owners are learning cross disciplines. So maybe they were traditional eCommerce and they’re starting to dip their toes in FBA. Maybe they’re traditionally eCommerce and they’re testing out drop shipping for products that they don’t currently carry and they’re trying to figure out whether they want to carry the product.
Justin:
So you know is what happens because of that and because the industry’s maturing and people are learning these cross disciplines is that they’re starting to understand that not only do they get another sales channel which obviously you know the more revenue in turn hopefully equals more profit, the more profit you have in the business the more the business is worth. But it’s exponentially so because you’re also gonna get a larger multiple for having these additional sales channels.
Justin:
So a business that does some sales via FBA, has a bit of drop shipping and has the kind of traditional eCommerce model is just going to be worth more on the multiple not just because of the sales channels and the profits bringing in.
Joe:
Yeah, I mean I think this is very interesting point. We definitely are seeing a lot more sophisticated business owners there that are starting to get into the three and four year mark of owning their business. And as they gain this more expertise it’s becoming quite clear to them that the only way to grow the business is in a channel that they haven’t tried before. They’ve got three, four years of experience in whatever channel they were in before. Let’s say that was FBA and now they know they have to go after a paid traffic channel or SCO channel to try to really grow the business and diversify it.
Justin:
I think there’s really interesting opportunities for partnerships here. Having gone to a lot of conferences and very like channel specific conferences you know I’m talking to drop shippers that really know nothing about FBA. I’m talking to FBA guys that know nothing about drop shipping. And I think if you can take that expertise and hook up with someone that is in a different channel, there’s some really interesting opportunities to partnership.
Justin:
For example let’s say that you’re an FBA, like you’re an FBA expert. Go to an eCommerce entrepreneurial meet up where they’re not doing FBA or they’re unfamiliar with FBA and see if you can work out a deal where you can get their products on Amazon right and take a piece of the business. Or you guys can partner together on some particular product lines.
Justin:
I just see a lot of opportunity for that and that will help grow the businesses making them even larger and give people and opportunity to shine in areas where they’re successful.
Joe:
Yeah, I think this is an interesting point as well and maybe there’s even the opportunity for someone to create a group or a business behind matching up these type of partnerships. I don’t know but that sounds very interesting to me cause yeah you’re right there’s getting more and more expertise out there and a lot of these guys say look I don’t want to have to learn a whole new channel even though I really think they should learn it themselves.
Joe:
But doing some sort of joint venture or some sort of partnership where they partner up with the other guy who takes care of the other channel is great.
Justin:
Alright man our fifth and final point is that Empire Flippers is going to close our first five million dollar plus business. Now this is big one man, we’re calling it right now.
Joe:
Yeah buddy.
Justin:
Yeah buddy. Here’s our reasoning for this, I think we’re gonna get above the five million mark in 2019. We’ve become more comfortable selling in like one million to five million dollar range in 2018. This is a place where you know we’ve gotten comfortable this year, we can do those deals we have buyers and those are going smoothly. I think as we continue to kind of move up market we’re gonna finally get one of those deals done next year.
Justin:
I also know that we’ve been expanding our marketing efforts to look at and attract those larger brands and larger businesses. So you know we’ve been having conversations with people on their seven, eight, nine, ten million dollar business about getting listed with us. It’s a longer sales cycle and I think it’s a harder sell right because we traditionally are in the like six and low seven figures, like what’s the upside for them?
Justin:
So we’ve been talking to them and working with them on ways we can make it, make it attractive and appealing and one of the ways to do that is to line up buyers. So we spent a good part of the second half of 2018 having conversations with buyers that are looking for businesses in the like three to fifteen million dollar range so that we have them ready to go, we have people interested in reviewing those listings once we get them up.
Justin:
So it’s kind of a, it’s the marketplace problem where if you don’t have the listings it’s hard to attract the buyers. If you don’t have the buyers you know the listings don’t necessarily want to come. We’ve focused on the buyer side so that we can you know make the case to sellers, look we’ve got this buyer, this buyer, this buyer, this buyer let’s do business.
Joe:
Yeah those guys are ready to go, they’ve got the funds, and they’re just looking for the right listing so it’s interesting to see if we get these in front of them how quickly we can move that. Cause you’re right, definitely the sales cycle for these larger deals it takes time. I mean people are not just going to just go ahead and wire five million dollars over without doing a good deal of due diligence in the business. And that may include flying to you, meeting you as the seller, making sure that they understand exactly what’s going on in the operation.
Justin:
Alright we’re through the five points let’s talk about the bonus round and this is the egg on our face, this is the cover our ass part of the show where we talk about what happens if there’s an economic downturn. So what happens to the industry if a recession hits and we’ve spent you know quite a few different points talking about what this might look to our industry. And we generally feel pretty good about it.
Justin:
I think there will be some change, we want to cover what we think would happen but I think as far Empire Flippers in the market we generally feel good. We want to get into what that might look like from a buyers and seller’s perspective cause there are some significant changes we think.
Joe:
Yeah look I never pray for an economic downturn. I think that people that do that are really self-serving, and you know don’t deserve to have it go their way. But there would be more deals especially the smaller deals under 500k. There’s no doubt that although the multiples would go down the smaller deals would be driven to the marketplace to sell more quickly.
Justin:
Well let’s back up a bit man, so you’re saying there’d be more deals. Right, let’s talk about why we think there’d be more deals. There’d likely be more deals because people need the cash right so they’re much more likely to list their business. They may have taken hits in other areas and they don’t want to take cash out of the stock market or whatever other investments they have. And if they’re needing the cash they may be willing to sell off some of their websites or some of their online businesses to fund the money. And particularly the smaller deals right the hundred and fifty thousand dollar, three hundred thousand dollar, eight thousand dollar websites and stores.
Justin:
We also think that the multiples are going to go down. Right, it’s gonna change from a sellers market to a buyers market. And again this is simple economics because we’re going to have you know a huge increase in inventory and there’s going to be less buyers cashed up to you know take advantage of that inventory with more listings will come lower multiples.
Justin:
Now what this means potentially for buyers who have cash, they could have a field day and have their pick of the litter in terms of the businesses that are available. And that, I mean you know it’s silver lining thing but that sounds pretty sexy.
Joe:
Yeah, I mean in a true recession I definitely think if there’s blood in the water and people are sitting on good cash reserves when asset prices go down you’re supposed to buy assets. So if you’re in charge of a marketplace that sells assets you really, you know tend to lean on the fact that would cause less buyers to come to the table.
Justin:
Yeah so what does that mean? In 2019 you think it’s highly likely there’s going to be an economic downturn being cashed up and ready.
Joe:
I don’t.
Justin:
Yeah, it being cashed up and ready for some discounted assets and having the pick of the litter might make a lot of sense. If you don’t think that’s the case then buying early, buying now, buying soon would probably make more sense because we do see multiples going up assuming no economic downturn in 2019 and getting them while they’re at a discount as opposed to six, nine months from now doesn’t make sense.
Justin:
But let’s talk about our points man, our five points and how this would affect it if there were a recession. I’d say that number one and number two would likely be reversed. So number one is multiples will go up. I think that’s we’re pretty certain that wouldn’t be the case they would go down. And then number two more money available in the one to five million dollar range that kind of weird range that’s like below private equity and above individual investors, I think that there’d be less money in that space.
Joe:
Yeah I mean if you look at it just logically multiples go down because there’s gonna be more inventory of course. Asset prices overall are gonna go down. And then, and one to five million dollar range, I mean you’ve gotta think in a recession that the interest rates would go up and there would probably be less loans to do those larger deals. Funds might have a hard time getting cash from investors who would like safer type of investments.
Justin:
Alright let’s talk about number three and number four. Number three real brands will be what buyers are looking for. I think that instead of just getting a better multiple for having a real brand and like, sell a well known business in your industry. I think it may be the difference between selling and not selling.
Justin:
So you know today if they economy continues I think you’ll get just a better multiple for having a real brand. The other ones will sell as well just for a slightly lower multiple. I think it could be the difference between being able to sell your business and not being able to sell your business, having a real brand versus a non-real brand.
Joe:
Yeah, yeah I think definitely the criteria gonna get stricter.
Justin:
I think the same thing applies for number four, more blended eCommerce businesses listed and sold. I think it could be the difference between being able to sell your business as like a multi-disciplinary multi-channel eCommerce business versus a single product or single channel eCommerce business. Those might just be tougher to sell across the board because of the availability and because of the amount and the quality of listings.
Joe:
Right, exactly and whenever there’s more inventory people’s criteria tends to get a little more stricter because they have more options available to them.
Justin:
And of the last point Joe, number five will be closing our first five million dollar business in economic recession. That seems aggressive, I don’t know man, I think that would be a little more difficult. But I mean I guess the answer is it depends because you’re still gonna have the private equity groups out there looking to get returns for their investors.
Justin:
I think my guess is there going to go back up the tree though, they’re gonna go back up to the larger deals and stop playing with the smaller ones. So I think that might make it a little more difficult for us for pretty obvious reasons.
Joe:
At the end of the day if you have the listings the buyers will follow.
Justin:
That’s true man. Alright buddy enough about that let’s do some news and updates.
Automated Voice:
You’ve been listening to the Empire podcast now some news and updates.
Justin:
Let’s talk about kind of what’s going on. We just wrapped up the conference season for us, for Empire Flippers and we did a lot of conferences this year man. I think we’re just over 20 conferences, but the conference season is basically October, November and we hit up conferences like DMSS and Bali and DC Bangkok and Bangkok and the Dropship Lifestyle Retreat in Bali. And then I just was at the Chengmi SCO event with Greg and Jeanie on the marketing team and we had a really good conference run. It was really, it was great kind of seeing some of our customers and friends and potential customers and be able to answer questions and be able to talk about kind of where the industry’s at so I’ve had really good time and I expect us to be definitely continuing the conference circuit next year.
Joe:
Yeah I know I traveled all the way back to the States this year to go see some people do some conferences. I’m doing another conference here in December in Bangkok and so the train rolls along and I think in this business conferences are just a fact of life. We’re gonna do a lot more in 2019, hopefully there won’t be an economic downturn to change that plan. But even if there is we’re definitely going to do a lot of conferences.
Justin:
Yeah the next bit of news man, we’ve had some serious growth in personnel at Empire Flippers. You know I was explaining this to some people at conferences and even people like know us fairly well were surprised to hear but you know Joe today as of right now we’re up to 58 people in the company. These are full time people working for Empire Flippers. That’s around 25 people in the Philippines and we have about 33 people on our distributed team.
Justin:
So we’ve grown tremendously in the last 12 to 18 months.
Joe:
Yeah, we’ve definitely grown significantly from me and you running this and I think that with the service based industry comes people and you really need to have the right people in the right positions and I think we’ve discovered that to be essentially the answer over the last two years and we’ve made a big investment in the business to do that.
Justin:
What’s interesting is how our roles have changed a bit. You know having a larger team and we’ve added HR recently and that’s been very helpful in kind of like thinking about our team and you know what we need to be concerned with and how we can better support them. And I think, I want to talk about that a bit on the podcast.
Justin:
I know it might be a little less applicable to you know the people that are just buying and selling sites but I think as we kind of level up I think it’s interesting to talk about the problems and the challenges that we’re dealing with and I’m hoping it’s interesting to our audience as well.
Justin:
So we can expect some talk about our team, and kind of like you know managing that growth and how we kind of put people in place. We’ll talk about that quite a bit in the future.
Joe:
Yeah I think this is something I’m looking forward to as well. It’s the next challenge for us you know we’ve definitely grown up as a company and I see some challenges for both of us in 2019 that we have to take the bull by the horns and make it happen.
Justin:
One of the things we just added, and I’m really excited about what this means for us is we had our first state of the company internal meeting. And basically this is kind of a state of union address where we do this quarterly for our entire team and it comes from you and I and what it kind of turned into was an extended internal podcast.
Justin:
But basically we ran through where the business is at, you know where we’re going, what we’re working on you know this quarter and last quarter. Kind of what the big picture what the vision is, and we wanted to make sure people were hearing directly from us. You know we’ve done some I think good work and you know kind of putting a management team in place and making sure there’s supervisors running their departments and divisions.
Justin:
But then that creates a wall or a bit of separation between you and I, and I don’t want anyone not being able to understand what we’re about. And so I think this will be helpful in like just kind of spreading the word on what’s going and where the company’s at and kind of where we’re coming from.
Joe:
Yeah, larger companies do this and I think it’s a great thing to do and make sure that people know that we’re still the same guys and still want to make sure that they hear directly from us at a regular basis.
Justin:
And then the last thing I want to mention is we have our next team or company meet up. We’re looking at Budapest in April 2019. So it’s still a bit of a ways away but we want to do a Europe meet up. We’re looking at either Budapest or Prague and it’s looking like Budapest is winning out. I’ll probably still end up in Prague afterwards cause I love that city. But we’ll be in Budapest for two weeks in April. So if you happen to be around or you want to come hang out with us a bit and you know go out for dinner or something we’d love to have you in Budapest if you’re around and love to meet ya there.
Joe:
Yeah and I’d do a little bit of European tour at that point to see the British Isles and do some other stuff so why not while I’m there in Europe.
Justin:
You should man it would be fun. Let’s do listener shouts also known as the indulgent ego boosting social proof segment. First up we did not have any new I-Tunes reviews. I think that our listeners do appreciate the show and are digging it. I’d really appreciate it if they’d head over to I-Tunes and give us a review and we’ll definitely give you a shout on the show.
Justin:
Did get some Twitter mentions. We had James Holt that said, if you ever get discouraged about online business, check out the Empire Flippers Marketplace, big money’s being made. Just a case of figuring out how to do it yourself. Appreciate it James.
Joe:
Yeah thanks a lot James.
Justin:
One of the other things I’ll mention is you’re, I mean I think there’s real value in a podcast we started called Real Money, Real Business. It’s the Real Money, Real Business podcast and what this is, it’s effectively seller interviews. So people that we’ve listed our marketplace for selling their business. But we’ve gone a little above and beyond in terms of asking them questions about why they got started, you know what kind of hang ups they had, how they felt when they realized they were on to something big.
Justin:
And the real benefit of this is you’re talking to you know regular guys and gals, people that are making real money. This has been verified, we’ve looked at their traffic, we’ve looked at their earnings so this. Like you always kind of have that question with like the internet marketing shows you’re like someone is talking about how much money they make, what their business is like and you’re like I don’t know about that.
Justin:
But we verify these businesses so if you’re looking for a no joke, no BS show where people will explain you know the inner workings of how their business works I think it’s a fantastic show.
Justin:
We also got a mention from Mr Web Capitalist who said, hey traffic sources, here’s my question, what’s the most underrated traffic source for affiliate marketing? And our director of marketing Greg got back to him and actually mentioned Pinterest. Which I was a little surprised to hear, Greg I don’t know about Pinterest you know for our business Pinterest doesn’t work very well but for you know people that are selling affiliate products like physical affiliate products there’s a real market there. And you know having like images of those cool or interesting products can be very effective.
Joe:
Yeah I mean I think if you can find a way to drive traffic via Pinterest in unique ways as well you can definitely be sitting on a gold mine.
Justin:
We did get a five star review on Facebook from Roni. Roni said I’m a second time [inaudible 00:33:32] my first website sold in just less than a month. The process was flawless and I got the payout just in a day. And the Empire Flippers support members are expert and very friendly. Roni thanks for the five star review man appreciate it.
Joe:
Yeah thanks a lot Roni.
Justin:
Well that’s it for episode 177 the Empire Flippers podcast, thanks for sticking with us. Be back soon with another show. You can find the show notes for this episode and more at empireflippers.com\2019 and make sure to follow us on Twitter @empireflippers. See you next time.
Joe:
Bye bye everybody.
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