Has anyone ever bought an online business?

[tyleriam]

I have been watching online business sales for a while now and have seen several interesting ones come across my email.  Curious if anyone has bought one or owns/runs an online business that could weight in on their experience.

[DrF]

Not sure if this is what you're after, but it made me think of this.

http://www.madfientist.com/website-investing/

[Nad]

I have started several online businesses from designing websites for others, to affiliate marketing, dropshipping, and now having my own watch brand selling online. I've sold one of my business. Others I've manage to automate 100% and they're still bringing in income many years later.

I'm happy to help if you have any question :)

[Scandium]

I have started several online businesses from designing websites for others, to affiliate marketing, dropshipping, and now having my own watch brand selling online. I've sold one of my business. Others I've manage to automate 100% and they're still bringing in income many years later.

I'm happy to help if you have any question :)

Just one; how in the world do you manage to make money selling commodity items (I count web design and marketing there) in a world where massive supply chains and size usually crush anyone else (hi walmart..)?! Every time I think of something I could sell or make+sell online there's someone else with more time and lower expectation of profit already doing it better and/or cheaper. I'd be curious about some details, if you can.

I have made $60 with uploads to shutterstock. So should equal maybe 2 hours worth for a decent salary? But there's always someone doing photography for dirt cheap. Or worse; for free for fun!

[tyleriam]

I guess my question is overall how did it go?  Seems like a lot of junk out there.  Is Flippa a waste of time?  Seems like the better stuff comes through brokers.

[Nad]

Just one; how in the world do you manage to make money selling commodity items (I count web design and marketing there) in a world where massive supply chains and size usually crush anyone else (hi walmart..)?! Every time I think of something I could sell or make+sell online there's someone else with more time and lower expectation of profit already doing it better and/or cheaper. I'd be curious about some details, if you can.

I have made $60 with uploads to shutterstock. So should equal maybe 2 hours worth for a decent salary? But there's always someone doing photography for dirt cheap. Or worse; for free for fun!

Branding and marketing are key. Price is the not the most important aspect of a buying decision for everyone. An easy example is someone who's buying a watch: someone with a very low income who just need something to tell the time reliably can go to Walmart and get a digital Casio for $20 which will do the job perfectly. But take a millionaire who wants a watch to show his status, maybe pass it down to his kid in 20 years and who is passionate about the mechanical intricacies of horology... he'll by happy to pay $15k or more for a Rolex.

Your example of photography is another good example. A large company who needs photography work will gladly pay more to hire a professional even if he's not any better than the kid who does it for free because they can't afford to risk it with an unreliable photographer. The pro will be there on time, all setup, with pro gear that will not break down mid-shoot so that you have to re-book the location, re-hire a crew and models, he'll backup everything and deliver on time.

There are different types of customers that value different things differently. To be successful you need to find that thing that is in demand which you can provide competitively. The most common mistake new businesses make is to compete on price when that's not the important factor.

I guess my question is overall how did it go?  Seems like a lot of junk out there.  Is Flippa a waste of time?  Seems like the better stuff comes through brokers.

There definitely is a lot of junk out there. I sold one of my sites on Flippa so I'd say it's not all crap. But when I was selling I checked out the other listings and there were a lot of scams. Mostly the cheap stuff. When you got above $10k it was starting to make sense. $50k and more seemed legit. I have not checked the listings in a very long time so I dont know what's the status now.

I'd say that if you don't have a lot of capital to buy a solid business you might as well start your own. You'll learn much more by doing it yourself which will put you in a better position if you want to buy another business later. You'll learn how to value the different assets of an online business (website, photography, branding, email list, search engine rankings, social media accounts, etc...)

There are some many different types of online business though. Is there a particular type that you're looking into?

[acroy]

Intriguing - thanks for the insights Nad.

[tyleriam]

I am sort of all over the board right now.

I am currently involved in three online businesses. 

1)  Own half of a little auto parts thing with my brother.  It has been profitable but no way to grow it.  I have gotten my initial investment back and looking to cash out my half soon and let my brother keep going with it since it is his thing.
2)  Brother and I created an app together, neat learning experience but only made a few hundred bucks back on a $2,200 investment.
3)  Wife and I bought some boxes of closeout Macy's jewelry for about $2,000 bucks and have been trying to resell it.  Quality was really bad, nothing is selling on eBay.  We will probably only make $500 back on it and it has been a pain in the ass.
4)  I have bought and done some online work as part of these businesses and learned/explored hiring and outsourcing my services, writing, etc.  Wanted to learn more about this type of stuff.  Hard to compete against the cheap labor, better to leverage the cheap (and I have found to be good) labor out there to create a business here.

So looking to take a step forward using what I have learned.  The jewelry thing I would say was a failure based on price...tried to use price to differentiate and it did not work.  The auto parts is very profitable but the market is small and it is somewhat labor intensive for my brother/partner.  All of these ventures have taught me that I don't want any partners going forward, not my brother or wife.  My wife is available for help but I need to be the only cook in the kitchen.  It's hard enough to find time/motivation to work and take action on these things in spare time while working 10+ hours a day, traveling for work, being a father, etc and I don't have time to spend debating or hemming and hawing over what action is going to be taken.  The most frustrating thing about these ventures to me has been talking about what needs to be done.  The jewelry thing is a result of a lot of talk and compromise followed by frustration of that process to 'lets just do something'. 

So long story short, want to try next venture FINALLY as the only cook in the kitchen.  Me and me alone.  I want it to be small but I want it to be something I can work and grow with my ideas and capital in my time.  I have been all over the board thinking about drop shipping stuff, group order Facebook group type stuff, new niche things (what is the next drone or Teatox...get in early, sale later).  Have not focused in on one thing.

[Nad]

I totally get where you're coming from. I had some similar experiences in the past. I also had partners and, like you, I prefer to be the only cook in the kitchen.

Considering your situation, your experience, and the frustrations you shared above, my advice would be to focus on digital products, specifically info products / ebooks.

Start with what you're interested in and see what are people's frustrations and pains regarding that topic. Now, is there a way you can package information to help people solve a problem? Most of the time it's just a matter of collecting free information and publicly available research and packaging it in an organized ebook.

Then you build a website to sell your ebook and your marketing and sales pitch should be focused on the problem you're solving. Always put yourself in the prospect's shoes. If you had this problem,  would you look for a solution? If so, how? Where? On Google? Ok, what exact words would you type? Etc...

I'm sure you understand the advantages of digital products over physical products: no inventory, no investment other than time (and then, mostly at the beginning), ease of scale, ease of delivery, "free" delivery, automation, etc...

[Telecaster]

I totally get where you're coming from. I had some similar experiences in the past. I also had partners and, like you, I prefer to be the only cook in the kitchen.

Considering your situation, your experience, and the frustrations you shared above, my advice would be to focus on digital products, specifically info products / ebooks.

Start with what you're interested in and see what are people's frustrations and pains regarding that topic. Now, is there a way you can package information to help people solve a problem? Most of the time it's just a matter of collecting free information and publicly available research and packaging it in an organized ebook.

Can you give a couple examples please?  I feel like one of my strengths is being able to distill information and communicate the summary, but I'm not sure what topics would be applicable.

[Nad]

Sure.

Bad idea: a marketing book
Good idea: a book on how to write effective headlines for google adwords

Bad idea: how to lose weight
Good idea: how to lose belly fat for women, with 42 exercises examples and an easy to follow 7-day meal plan

Bad idea: how to make money online
Good idea: how to make money with adsense on your wordpress blog, with bonus: the 7 most profitable wordpress layouts + 200 blog post ideas

You get the idea? It needs to be specific enough and it needs to address a real pain people experience in their life, their work, etc...

[tyleriam]

Nad that is great advice/guidance.

I have been mulling over just such an idea.  I am going to focus in on this one idea.  Love the advice about a pain point and re-packaging information that is very true. 

[Nad]

Happy to help :)