Webstreet - Empire Flippers Capital - Website Investment
- Thread starter MrMedia
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I saw the webinar but I am not sure if I am ready to invest. I think it's too early for me because I am still building my own assets and I am happy where I am at right now.
They have a good reputation online so if you have the time and money, I don't see why you wouldn't invest.
They have a good reputation online so if you have the time and money, I don't see why you wouldn't invest.
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Yeah I’m nicely diversified already with my investments and it seems that it’s a nice alternative to the usual suspects. I could never think of anything worse than running an fba biz so it’s a good way to get exposure to that too without getting my hands dirty.
20% returns seems punchy but the stats do seem to back it
20% returns seems punchy but the stats do seem to back it
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The thing to remember about anything where there is some return % is that returns are generally priced by the market and therefore priced by risk. Higher returns tend to correlate with higher risk of ruin.
It seems reasonable to assume that websites/web assets are sold at sufficient volume these days to imagine that there are enough reasonable buyers and that sellers are on average not so ignorant as to be ripped off in every sale (ie they're not selling at a lower price with an implied annual return to the buyer of 20% when the risk profile would only justify an implied risk of 9% ie a much higher sale price).
Therefore if sites are selling with an implied risk that requires a 20% return for the valuation it's in the high risk investment category.
For 'risky' investments like single stocks, say - eg someone with $1,000,000 buying a handful of stocks having 10% in any one stock might be considered 'ok but not ideal'. So a bankroll at least 10x multiple as a maximum punt. Buying something as risky as a website with an implied return of 20% that could in theory tank at any point before 5 years is up (either due to massive changes in traffic sources/costs/or the market in general) I'd imagine the required bankroll size should be considerably higher. Maybe as much as 3-4m to consider buying a small handful of $100k sites as part of their overall strategy.
Someone with $200-300k should definitely not consider buying one for $100k and one should definitely not buy one as a leveraged investment (in most cases). The higher return correlates to a higher risk of ruin - in the long run you may be no better off buying these high risk assets than just investing in a tracker fund because it would (even buying several sites) only take one or two to go to zero or near-zero to bring your average return down to more market levels (or worse).
Disclaimer: I no longer hold any financial advice authorizations etc - this is just some boring stuff a financial adviser might say to you if you asked but I think most people would be better doing something else with $100k than buying a random site - unless they're rich enough to diversify the risk with a good few purchases and a solid plan for each site (including a team in place to manage their growth etc). Speak to a proper financial advisor if you want current advice etc...
It seems reasonable to assume that websites/web assets are sold at sufficient volume these days to imagine that there are enough reasonable buyers and that sellers are on average not so ignorant as to be ripped off in every sale (ie they're not selling at a lower price with an implied annual return to the buyer of 20% when the risk profile would only justify an implied risk of 9% ie a much higher sale price).
Therefore if sites are selling with an implied risk that requires a 20% return for the valuation it's in the high risk investment category.
For 'risky' investments like single stocks, say - eg someone with $1,000,000 buying a handful of stocks having 10% in any one stock might be considered 'ok but not ideal'. So a bankroll at least 10x multiple as a maximum punt. Buying something as risky as a website with an implied return of 20% that could in theory tank at any point before 5 years is up (either due to massive changes in traffic sources/costs/or the market in general) I'd imagine the required bankroll size should be considerably higher. Maybe as much as 3-4m to consider buying a small handful of $100k sites as part of their overall strategy.
Someone with $200-300k should definitely not consider buying one for $100k and one should definitely not buy one as a leveraged investment (in most cases). The higher return correlates to a higher risk of ruin - in the long run you may be no better off buying these high risk assets than just investing in a tracker fund because it would (even buying several sites) only take one or two to go to zero or near-zero to bring your average return down to more market levels (or worse).
Disclaimer: I no longer hold any financial advice authorizations etc - this is just some boring stuff a financial adviser might say to you if you asked but I think most people would be better doing something else with $100k than buying a random site - unless they're rich enough to diversify the risk with a good few purchases and a solid plan for each site (including a team in place to manage their growth etc). Speak to a proper financial advisor if you want current advice etc...
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The wealthiest person I personally know, had this process:
day 1) build his own projects + worked for Yahoo! (up to some level where he even used their jet)
day 2) started using money to buy other people's sites, and invest in them (using his knowledge to explode their values)
day 3) Became an angel investor in web projects and now also has some investment in crypto DAO projects . Is a silent owner in some massive projects, including instacart
So , YES... If you can invest, you should . It's a smart way to use your time and only involve yourself where you are sure to increase revenue
"Only move when you can Add a 0"
And by 'day' i just mean a phase of his life I watched
day 1) build his own projects + worked for Yahoo! (up to some level where he even used their jet)
day 2) started using money to buy other people's sites, and invest in them (using his knowledge to explode their values)
day 3) Became an angel investor in web projects and now also has some investment in crypto DAO projects . Is a silent owner in some massive projects, including instacart
So , YES... If you can invest, you should . It's a smart way to use your time and only involve yourself where you are sure to increase revenue
"Only move when you can Add a 0"
And by 'day' i just mean a phase of his life I watched
KhairujjamanS
I get my Dopamine from outranking competitors
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If you have a big chunk of money sitting idle then it can be a good idea to invest. There's risk too. So not wise to invest there if you might need that money anytime soon.
I personally know a EF Capital site operator who got multi-million funds from EF Capital + his private investors. One time he told me another EF Capital site operator he knows, bought a website for $500k+. Right after the inspection period ended, Google core update came and wiped that website's ranking.
Definitely, EF and the site operators are very experienced. But not everything is in their hands. I do believe they have plans to mitigate risks but the estimated "ROI" will get heavily affected if anything unexpected happens.
But things don't always go as planned, specially now with all that crazy Algo fluctuations.
##
If you do not have a big chunk of money sitting idle then don't invest there.
If you have the time, knowledge and budget; then I suggest you build a team and use that fund to run your own portfolio.
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What happened the operator who got wiped out?
KhairujjamanS
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I got the news a few days after it happened. Don't know what happened later on.
Probably they will try to recover the loss with other projects. And try recovering the site itself. But still losing $500k+ valuation is a big blow to overall ROI
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I have been on the fence about it as well (came here awhile back to see if there were others investing, but thread didn't get traction). I'm well diversified already, and have had positive past experience with EF on the selling side of personally owned web properties.
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Same. I might put a couple of hundred k in and see what happens. I trust them as a company so bar operators majorly fucking up im pretty confident of a solid return.
I also like the idea of investing in all - like an index fund spread - rather than trying to pick individual winners and losers.
illmasterj
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If you haven't already come across them, it's worth mentioning Onfolio as well.
They started off with a content site focus but seem to be buying service businesses these days. My feeling is that they are a lot more defensible than affiliate/display ad sites that rely on 95% organic search traffic.
They started off with a content site focus but seem to be buying service businesses these days. My feeling is that they are a lot more defensible than affiliate/display ad sites that rely on 95% organic search traffic.
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Seems risky with AI, 3rd party cookies etc. I am concerned about my own web publishing operations, let alone giving the money to someone else. Plus you have the current macro environment (highly uncertain and volatile). From a general investment perspective, cash is king right now. Market rewards patience and this is a great time to wait for opportunities.
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Ti
cash is being wiped out by inflation but yes shaky times ahead to a degree. I’m going to end up too heavy in stocks and property so still looking to diversify.
cash is being wiped out by inflation but yes shaky times ahead to a degree. I’m going to end up too heavy in stocks and property so still looking to diversify.
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Not really with this interest rates
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What? If everything, cost of living, has increased by 10%+ and you had $1 million in your bank, the value of your money has decreased by 10%. That $1 million a year ago is worth $900k.
From bread, to eggs, to gas - all the basic elements have increased in cost. If gas increases that means the trucks bringing you those first two items have to increase their rates, which then drives up additional the cost of bread and eggs.
The supply chain can only absorb so much (reduce profit) until they have to pass down the cost, otherwise they go out of business; which would then reduces supply, and increases price since there are less provider of said product/service.
It's basic economics 101.
If someone was making $15 an hour a year ago, and gets a raise to $20, that's nothing to celebrate when eggs go from $2 to $8 and gas goes from $2 to $4. And they need that gas to even get to and from work every day. And then throw in rent increases, he has to move to a cheaper location, which is most likely further from his work, more gas.
These simple scenarios are playing out all over major cities where employees have to live further and further from work simply because of inflation.
Simply talk to an average employee or front line worker and ask them is their wallet shrinking and getting tighter? They will tell you lots of similar stories on how it's impacting them.
The reason unemployment is at the lowest ever is because you have people working 2-3 jobs now to make up the difference due to inflation.
Prices are going up but all of a sudden everyone is employed? Doesn't make sense unless they could not make it like before and need to adapt.
Interest rate increases simply slows down businesses from borrowing more money to expand and most of the time operate. That's not good either. Someone is bearing the brunt of this and it's ALWAYS the people on the bottom of the rung.
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What are you comparing cash with? Doesn't make much sense to say that in a vacuum. You can get around 5% with little risk now.
I replied to MrMedia who said he's in stocks and real state. For example the SP500 is down 13% in the last year so yes, you did better if you held cash and lose around 5-6% after interest.
And if you invested in SP500 you also suffer the 10% inflation you mentioned. So now you have less money and that money also has less purchasing power. So you lost 2 times.
And I live in a country with 100% inflation so I think I know how it works better than all of you lol
I replied to MrMedia who said he's in stocks and real state. For example the SP500 is down 13% in the last year so yes, you did better if you held cash and lose around 5-6% after interest.
And if you invested in SP500 you also suffer the 10% inflation you mentioned. So now you have less money and that money also has less purchasing power. So you lost 2 times.
And I live in a country with 100% inflation so I think I know how it works better than all of you lol
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