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How I Built an Online Business and Sold It. Part 4

How I Built an Online Business and Sold It. Part 4 | Ep. 58

How I Built an Online Business and Sold It. Part 4 | Ep. 58

How I Built an Online Business and Sold It. Part 4 | Ep. 58

Summary

Part 4 how I started, built and sold my online business. 

This is a section of a book I’m writing with the working title,

“This way. Living, Loving and Finding Your ‘insert your first name here‘ – Ness. 

I lay out my journey from start to finish. How I…

  • Started with just an idea
  • Built the site
  • Built an audience
  • Marketed the site online and off
  • Raised over $2 million
  • Build a subscription membership on the site
  • Used affiliate programs to make lots of money from the site
  • Got content for the site on a regular basis
  • Built a huge email list
  • Started a podcast to market the site
  • Bought it back from the investors
  • Ran it as a side hustle that thew off six figures a year, for years
  • Sold the site to a large media company

It’s all here. If you follow the steps it can work for you too. 

Let me know what you think by dropping me a a line at B @ Brandon C White dot com. 

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Hello, friends. Welcome to the show. We continue with Part four of how I built my first online business, and this is the working chapter of a book I’m writing called This Way Living Loving and Finding Your Insert Your first name. This. Let’s get do it part or we buy a company the like of Steel put us ahead of any of our competitors who were trying to replicate what we were doing and gave us a lot of positive press.

One of the largest regional fishing markets was Florida. We’ve been trying to expand our coverage using our regional editor model, and while we were growing the market, we were not growing as fast as we would like. And certainly not fast enough to be the leader. We knew from our experience from buying one company right after changing our name, toe worldwide angler that that had helped us and we thought it was time to buy another.

We’ve been watching a few sites in Florida and one in particular called anglers. Info seemed to be pulling away from the pact and appeared to have some very strong founders. I wrote to the CEO and president and asked if they’d be interested in becoming part of our team. There was a lot of back and forth help from our board and talking with them.

And ultimately, after two in person trips and two months of negotiations, we came to a deal. The deal put us on the map in Florida and combined with what we had already had, it made us the leader in the market integrating another team. I’ll briefly mention that buying a company integrating two teams that work in different offices is not the easiest thing. We managed to have success by having people from the office spend time at our headquarters for some long stretches in the beginning so that everyone got to know one another.

Don’t let everyone to put a name with a face. Then we made sure that we had regular weekly meetings so that the Florida office felt in the flow. It wasn’t perfect, but it worked. The key was being very deliberate and discipline to keep the Florida office in the loop, airing on the side of over communicating. It wasn’t always easy, nor was it perfect and execution. But through efforts from all of us, we made it work successfully the dot com bubble verse. We were coming into 2001 with a lot of growth, positive momentum and looking ahead to our third round of funding. And then, as if out of nowhere, the dot com bubble burst, the stock market crashed, investors evaporated and people became skeptical about business models on the Internet.

Our existing investors did not believe our business would work long term, and all of them declined to fund another round. We tried to raise money from new investors, but it was impossible. It quickly became clear. We’re going to need some drastic measures to save our business. Drastic measures translated into around the layoffs to reduce her burn rate. Up until that point in my life, it was one of the hardest things I’ve ever had to dio so hard that I delayed doing the layoffs for three days straight. Finally, I thought, I have some courage and we made it happen. It was terrible having to let team members go.

We have become a family that lowered our burn rate and we continued a few more months trying to raise money, but to no avail. It became clear that we were most likely going to have to shut down. Eric and I sat down to discuss things, and neither of us wanted to give up well. We may have been running out of money. We believed that we still had a business that would work, and we believe that the Internet was going to be even bigger down the road. This was just one little bump in the road. We weren’t sure how we’re going to keep it alive, but we were determined. We took our message to the board and said that we were not going to give up.

Eventually, the board voted that we needed to close the company with no funding in sight. There was not much Eric nor I could do because as the business stood, the truth was there wasn’t enough money to keep it going. That was the reality. The doors closed that night. Eric and I got together and decided we were going to buy some of the assets and restarted. We weren’t going to give up that easily. After all these years, we had learned a ton and it’s not as if he and I had not been here before.

There were just two of us. In the beginning, we would do it again, back to our spare bedroom offices. We’re not giving up. Within 24 hours of World Wide Angle closing, Eric and I had a site up and running called Title Fish. We decided we would fund it ourselves and running those a side gig until a point where we could ramp it up and pay ourselves both salaries again. We both agreed that we would get full time jobs and committed to working on the site of nights and weekends. This was not new territory for us, since this is how we started. We knew it wasn’t gonna be easy, but it was doable. On launch, we decided to apply one of the many lessons we learned own our market first. Before expanding our target market was the Chesapeake Bay in mid Atlantic.

We committed to staying focused on this region. There were plenty of fishermen that would allow us to generate revenue and multiple raise. From this one target market alone. We had membership to the site. One of the first things we did was designed member packages for people to become a title fish member members would get added benefits to the sites, such as elevated status in the forums. With the designation of Title Fish Subscriber, I support the site a signature block with their picture in the bottom of all of their posts on the forums. Title fish sticker access to members on Lee forums, discounts on products that we negotiated, expanded storage to host their fishing pictures and discounts on title fish merchandise.

One of the letters we received and we receive on a regular basis from our customers. Dear Brandon. As promised, I’ve been closed to check for $25 to attain super subscriber status on the Title Fish Forum. As I mentioned in my email, I really appreciate the service you provide. I grew up around the bay and my mom still lives in Virginia Beach, where I keep my boat. Between the two of you, I have built an umbilical.

I need to stay tuned in two from Riley. Thanks for your efforts. Steve Enclosed is a check for $25. We were lucky to have a community that valued the service we were providing and wanted to support the site. Because of that, we were successful in launching our subscriber membership model repriced memberships from $12 a year to $399 a year, all if offering different levels of benefits. I could write a book on why our membership program was successful, what dynamics of our market allowed us to have such a strong community and techniques to encourage people becoming members. But given where we are in this story already, we’ll have to save that for another chapter.

The bottom line is, memberships were great, recurring revenue source for us and allows us to identify our super fans. The super fan concept is also one I could write a book about. But again, that’s for another chapter launching a podcast. It was 2004, and podcasting had just come on the scene. I decided to give it a try on this platform, since we had already been releasing audio files and attaching them as links that people could download to get fishing reports.

Now this had been given a name podcast. We were not sure if this podcasting thing was going to take off or not, but we knew we could put together interesting interviews for anglers, provide fishing reports and they would tune in. And it will allow us to strengthen our brand with our current customers and potentially reach people that didn’t know about us yet. There was no online classes on how to start a podcast.

Back then. It was a new frontier podcasting equipment. I bought a portable mini voice recorder, a Mike, and I was in business for podcasting software. Well, for editing, I used a really basic music editing program and later then garage brand that was released in 2000 and four by Apple. Both programs allow for easy editing an MP three MP three for export, which I have uploaded into the newly launched apple podcasts. The lateral line podcast was born and it worked. People really liked it, and they tuned in on a regular basis. I linked to the podcast from our site, always promoted them in our newsletters and posted them on other sites around the Internet that allowed for podcasting posts. People grow apart. Eric and I have been through a lot over the seven years we have been working together. It was a true adventure. It had its ups, its downs, and some parts were surreal.

That we thought we were in a movie. For the most part, we always got along. We didn’t always agree with one another. We had a mutual respect, which was the key to our success. That respect for one another in the heat of debate lead to good decisions over the years. Views. After we restarted the site, Eric decided he was going to move back to Pennsylvania to pursue some job opportunities and to be closer to his family. We were close and had worked together for so long that we didn’t see working remotely is any problem.

And in the end, it wasn’t. We communicated online, talked via phone and occasionally visit one another to collaborate on bigger initiatives we took on to grow the site. As time went on, Eric and I started to disagree about the direction to take the site mostly around growing revenue. Eric wanted to be more aggressive with advertising, putting more ads on the site to drive more revenue. I, on the other hand, believed that revenue was hugely important, but I didn’t want advertising to degrade the user experience. It all really came down to time.

Eric was starting to evaluate and rightly so his return on investment of time he was putting into the site outside his day job. We were making money with the site not quite enough to pay ourselves full time, but very good extra spending money. That was enough for me, and I was willing to wait for revenue to grow slowly Over time. I also started to like the idea of having passive income in addition to the money that I was making with my day job.

Eric wanted things to go faster. In all fairness. While Eric love fishing, he was not into it as much as I was. This gave each of us a very different relationship with the business. Ultimately, the disagreement led us to party ways. We paid out some money to Eric and I took over the site. It was the end of an error. Solar premier.

I was back to where I started solo Premier. I come full circle. Everything happens for a reason, right? So I stayed focused on the opportunity that it presented. I was exponentially smarter than I was. When I first started as a solo procure and now had mentors who I could lean on. I took some time after Eric and I parted ways to think of how to move ahead. Did I want another partner? It was nice having someone to bounce ideas off of, have them bring ideas to the table, make each other’s ideas better and forge the up and downs together. At the time, I thought it might be nice to make a decision and not have to run it by someone. Whether that is good or bad, I wasn’t sure, but it sounded a lot easier. Plus, I thought I had a mentor network to lean on for any big decisions. Where does I want to take the business?

Did I want to make it a goal to be a full time job again? Did I want to run the side as a side hustle? Could I automated enough to run it as a side hustle with Onley a few hours a week? There were lots of questions going through my head. I decided that I was going to go it alone, be a soul poor run of those a side hustle, learn how to automate things and outsource all the functions that I couldn’t do myself. I built a three year business plan that included expanding our title fish product line beyond title fish hats, T shirts and sweatshirts, building out riel world events and figuring out how to expand advertising revenue without cluttering the site with advertisements focusing on the most important parts of the site.

Since I was now running the site myself, I made it a point to Onley. Focus on the parts of the site that people use the most and the parts of the business that offered the most potential essential parts of the site and of the business were one weekly fishing reports, written podcast and or video casts to moderating the forums and art unto itself that is worthy of a short How to book three. Membership in benefits for merchandise sales. Five email newsletters, six search engine optimization that drove free traffic. Seven. Advertising and sponsorships of the site. Eight. Classified ads. Nine.

The Mobile App that we launched in 10 site hosting and servers that ran the site. My next goal was to outsource and automate as much as possible fishing reports to assure the fishery reports made it out on time. I hired a writer on hourly basis to make sure they got put together and published weekly. Consistency is key for moderators because the foreign received a high volume of posts and traffic across all the different regional and topics that we had. I recruited several moderators to help keep up with things.

When you get over 1000 posted a thread can easily get out of hand in just a few minutes, if not an hour. Having several moderators help keep up the harmony, not to mention because we had a strong community and lots of traffic, we would get spam or when someone got out of line, we had people who would report things really quickly and alerted us to the potential problem. When you build a strong community, the members themselves will take ownership, and in this case, they did for us. And it was great membership in benefits. Our program, the site so that almost everything was self service.

A person could log in, read about the different types of membership levels, what each one offered, and by right there online. I also created several videos that while people through a demo of what they would get, it was self service, registering for the site in order to cut down on any spam that would occasionally show up in the forums, classifieds or other areas where people would comment. I required a business email to join for immediate approval. If someone wanted to use a free email account like Gmail or Yahoo Mail, they could sign up.

But as part of the process, they had to write a short explanation why they were using a free email account. This did a few things it cut down on the span that had to be moderated. It created a feeling of exclusivity, and I decided that quality was better over quantity. Last point was a shift I felt was worth the trade off. I wanted to grow the business and made the bet that with better quality on the forums and other interactive parts of the site, we would get more engagement and loyalty to the site.

In the end, it worked. People stayed on the site over 11 minutes per session, came back on average two times a day, and approximately 68% of our total registered users came back at least once a month. Merchandise we sold all our own merchandise. There are e commerce part of the site. As I mentioned, the margins on the clothing were really good, expanded the T shirt line and original designs. I sketched him and hired artists on per design basis and cut down on inventorying overhead, went to an on demand printing process, leveraging high quality heat transfers.

This eliminated the need to maintain a ton of inventory, and within a year I had this outsource to a company who would fulfill all the orders, decided to leverage our brand recognition and go into the fishing lore business. It was quite a journey learning the whole production process and supply chain management to get a quality product out the door. Well, I wanted to sell lures on the site. I also wanted to get into the big box retailers to help with distribution. I was able to get into a national chain called Voters World at the time, while the Lords were good quality and provided good margin. The kicker that got the deal over the line was that we had a promotion vehicle to get people into the stores to buy our laws.

It was a two way street. We would promote the lures were available at Voters World and by having the Lords in the stores. It was an additional sales channel and provided us exposure. I’ll give you the cliff notes on how the lower business turned out. We got some big orders, which was good revenue. Voters were went out of business. Demand for the Lord’s continued to be high, but shipping costs killed us.

Shipping was almost half assed. Muchas the lower itself, because the lords were made out of metal, mostly lead. I ultimately took them off the site and sold them in person events. Doing that, I learned trucking around heavy products is hard to dio. Eventually, once I sold off most of the inventory, I shut the business down. Many lessons learned. Search engine optimization seo. I relied on S E O almost exclusively for our online marketing. I never bought any paid ads online to drive traffic. At first, the S. E. O of the site was something that I wanted to outsource. As I thought about it more, I decided to do it myself because of how important it was to our traffic. I’ve gotten really good at it over the many years, and I actually enjoyed the challenge.

Appearing in the top three results on a page is pretty rewarding. When I sold the site traffic estimating Tools said that I had created over $500,000 month worth of organic S E O traffic. That means that someone would have to pay $500,000 in paid keyword search ads to receive the same amount of traffic. That was huge. I was getting it all for free by implementing these S E O strategies I had developed through all the years. I never spent more than $50 a month on paid advertising that includes print or anything else in today’s Internet. It makes total sense to use paid ads because of what it does in the search engines for you. Most importantly, in my business today, I still receive the majority of my traffic organically.

You can pull it off if you implement the right techniques anyway. Ranking in the top three results pages across thousands of keywords created a strong moat. This kept competitors out in a fresh stream of new visitors coming into the site regularly. Email newsletters doing weekly email newsletters was probably one of the most important parts of the business. It allowed me regular contact with our visitors and customers. I always thought it was important to write the intro in the newsletters myself, and I continue to do that till the very end. I outsourced all the editing and formatting, which is super time consuming, part of putting together an email newsletter.

The newsletters allowed me to stay in touch with people on a one on one basis. It was a channel for them to hear directly from me, and it reminded them of what was happening on Title Fish. It created a feedback loop that allowed me to receive regular direct feedback on how we were doing. The key to using this method of communication was the personalization. When people are right back, I always responding, responding, got challenging at times with well over 100,000 email subscribers. In order to make sure I responded to everyone, I learned how to batch process responses, effectively site advertising sponsorships in order to streamline things. I did two things. One I moved to working with one banner ad agency.

I was able to negotiate a high CPM because of the highly targeted audience we had, and I gave them exclusivity on handling our site. We re negotiated on manual basis to I sold site sponsorships that gave an advertiser AIM or integrated advertising product. They received exposure in several parts of the site and not just your typical banner product. Just kept the number of banners on the site to a minimum.

The user experience. Excellent. And as I mentioned, I didn’t want to cite packed with the ads all over the place. Sponsorships were high price advertising products, so I go work with a handful of advertisers verses, potentially hundreds of smaller ones. Net Net. We made more revenue. Smaller advertisers service through offering a commercial level subscription that was fully self service. Classifieds. Classified was something that we always had on the site, and they actually were a good source of revenue.

They were completely automated and barely required any support. On top of that, it was the honor system. We ask people to give us a percentage of what they sold very much like the eBay model, but we didn’t enforce it. And guess what? People would send us checks, pay palace money all the time. Mobile app, APS. We’re getting hot, and I had the hypothesis that if we provided a mobile experience, we could extend the real time nature of fishing reports and that would increase our content and took some work to maintain. But in the end, it was worth it.

Anglers use the mobile app when fishing to post pictures in near real time, and it made it a lot easier for them to participate in the site site hosting and software maintenance undoubtedly the most important part of the business. If the site wasn’t up, there was no business. I was lucky enough to reach out to a guy knew from college who detects support as a side hustle, and I hired him as a contractor to handle all the site hosting and software maintenance work for some of the minor stuff. I’d take care of it, but 90% of it he handled my four year business plan. It was 2012. Site continued to grow, and I continued to run it as a side house. So why I worked my day jobs. I’ve been running an online magazine with a community and e commerce component, online community, interactive media sites, social networking, site or whatever, the buzzwords where it was at the time for a site that had content and interactive community and e commerce. For now, over 16 years, I was lucky.

I started my entrepreneur journey at a young age. Feel grateful that it coincided with the growth of the Internet? I was making Net six figures a year with the site. It was a great side hustle that provided great passive income. In fact, it was making a much as I was in my day job. If I wanted, I could stop my day job working as a business consultant. I wasn’t going to jump ship on my day job without a solid business and life plan. One of my wife’s and I goals was to move to California, specifically in the San Francisco Bay Area. My wife is originally from California and wanted to move back at some point and escape the East Coast winters.

I wanted to be closer to Silicon Valley that I always saw as the capital of entrepreneurship. One of the challenges to move into Northern California is housing prices. We had savings, but homes in the Bay Area from our research, where at least a million dollars. That’s a heck of a lot of money, right? My business plan spelled out specific milestones to grow the business over the next four years. These milestones were designed to position the company for an exit and selling the business I hoped would allow us to have enough money to buy a home in California the next four years. I took delete, quit the consulting business I was working for and went all in. I worked really hard the next four years, driving user and revenue growth and staying focused on owning my market.

It wasn’t always easy working as a sole premier, but I had hired a business coach and had mentors. Additionally, I had hired really strong contractors and kept an eye on my business and my personal goals. I get to call two months shy of a four year mark. When I quit my consulting job and implemented my business plan, I received an email. It was from a guy working for a large media company in Canada called Vertical Scope. He inquired if I was interested in selling the company I wrote back and asked why they wanted to buy the site he explained that they were doing a roll up of regional sites to create one larger site that would cover North America. I had a slight grin on my face.

The quote stay focused and oh, my target market unquote strategy seemed to have worked. It wasn’t always easy. The desire to expand was always there. But I have learned that lesson before. I explained to the guy that I was open to discussion for the right price and also to the right buyer who would take care of the community that relied on the resource. I had a lot of friendships from the site, and it felt like one big family. After a back and forth for six weeks, we had an agreement. We finalized the paperwork within a week. Set of clothes date for the following Thursday that Thursday I was in California.

I’ve been going back and forth for several years because I had a software product idea that I’ve been working on. It was my side hustle to the side hustle that had turned into a full time job story that brought me back to wall entrepreneurship. I remember reloading my bank account page in one minute. There’s a few figures, and the next there’s seven just like that. Well, not really just like that, But that’s the part of the story that gets the press. I have a non disclosure that does not allow me to talk about the exact amount that we made. This makes sense. If you’re in their shoes, they wanna want people to know how much they pay for sites, and they don’t want that to be public. Anybody entrepreneur would take that information, use it against him in future negotiations. But here’s what I’ll tell you. I was able to get a premium on a very high multiple on the site.

And there were three key attributes to the business that led to this one consistent growth. The S E O Asset we had along with the viral growth, was very attractive. The business growth didn’t rely on pouring money into marketing. If they did do marketing, it would be the icing on the cake to I had built a brand title. Fish was a brand brands command, a premium because they inherently have value from the time it takes to establish him. They do not happen overnight. Three recurring revenue.

The business had memberships that renewed on an annual basis, and we had very low term because of the personal connections and value that we had delivered. Believing you could dio what you don’t think you can. Dio Seeing the money in my account was extremely satisfying to know that I had accomplished my goal. There was several times along the journey that it could have ended because of one thing or another. I credit persistence, consistency and adaptability to making it over the finish line. Two days after the money was in my bank account, I bought a house for us on the ocean in Northern California. The next thing I did was pay off all our student loan debt well over $120,000 paid off our car loans, bought a sports car, bought an RV and launched another company.

That was the side household, a different type of business and another wild business ride. Learning any more business lessons? So you might ask, what was I doing from my day job? Well, I was hired by a venture capital firm founded by Bill Mountain called G I VI Venture Partners. Bill was the founder of their phone, the credit card swiping machine. He also founded DNS Networks, one of the first software companies to run on the credit card swiping devices. We provided Growth Capital rapidly growing companies in the technology and health care markets to I worked in America Online in the first Internet big data division called Marketing Analysis and then Premium Services. I was a senior manager in the highlight of my stand was being part of the anti virus team. We grew the service from 0 to $90 million in one year. Three. I was recruited that available to another venture capital firm, called up Data Partners.

At the time, we managed over $300 million and investing in enterprise software and Internet companies ranging from start up Phase two growth phase, and I went back to school. I left venture Capital and went to business school at UNC Chapel Hill. Kenan Flagler today that five international schools and had an amazing time. And while I was in business school, I took the final few classes that I needed to finish my masters in psychology that I had quit to start the original fishing site and I worked at a boutique consulting firm called Carbon Prime.

After graduating on my MBA, where we built business plans for people, we help companies spent out software that they had developed internally and build that into a new company. Acted as an outsourced CFO for several startups, and we built full interactive marketing strategy plans for medium sized companies. That was my last stop before quitting and going all in on the side hustle to the fishing business that I had not a bad ride. I want to thank you for being generous with your time toe. Listen to this working chapter of the book I’m writing.

We covered over 24,100 words together already hope it was entertaining, and as importantly, I hope it provides you a blueprint of how you can turn your side hustle into a full time business, which is the business of your dreams. Well, that’s a far as I’ve gotten so far with the book about 24,000 words, and we probably have another 50,000 to go. I’d appreciate any feedback you have, and I hope that it was helpful truly.

If you follow that blueprint, you really can use it to build an online business and stay tuned because my goal to get this book out to the public in 2021 and thank you friends for tuning into the show. If you enjoyed this episode, please rate review. We want to hear from you and subscribe so you don’t miss any of our weekly episodes until the next time. Remember, you are just one business plan away. I’m rooting for your success. We’ll see you soon.

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