I’ve got a confession to make:
Although I’m immensely proud of my $1.5 million website portfolio, I can’t claim to have created it entirely from scratch.
Instead, I built much of my portfolio through website investing, buying up already profitable websites, optimizing them for even greater financial returns, and, in some cases, even selling those websites for profit.
Of course, I made a few mistakes along the way, but I’ve also enjoyed success as a website investor.
In this beginner’s guide, I’ll share everything I learned from my mistakes and successes to help you learn how to get started in website investing for yourself.
How Does Website Investing Work?
Investing in websites is no different from investing in any type of business. It’s all about spending money to buy an asset that you then use to generate a significant return on your investment.
Most website investors will usually take one of several approaches to generate this ROI.
Some choose to run their new site as their own, employing effective website monetization strategies to grow their revenue and enjoy a recurring source of passive income with no intention of ever selling it on.
Others will focus on building upon the previous owner’s work by increasing the traffic and revenue to ensure the site is worth even more than when they bought it.
They then sell this website for a profit and often -though not always- use some of the revenue generated to buy another website and repeat the whole process over again. This is what’s known in the industry as “website flipping.”
My Strategy for Website Investing
My preferred approach is a combination of the above two methods.
I actively seek out websites that are turning a profit, and if the owner is looking to sell, I make them an offer either directly or via one of the website flipping platforms I’ll show you later in this guide.
Once that offer is accepted, ownership of the site and all relevant login details are transferred to me.
My team and I then work on developing that site by finding new keywords to target, creating compelling, optimized content to rank for those keywords, and monetizing that content through affiliate marketing and other income streams.
While all this is going on, I continue to collect all the money generated by the site and will hold onto this money maker for an average of about one year.
When the time is right, I calculate how much the website is now worth (I’ll show you how to do that later) and put it back on the market for more than I paid.
This has the double benefit that I get to enjoy a recurring income stream for a year before cashing out with one big lump-sum payment.
If all this sounds pretty simple, that’s because it is, but that doesn’t mean there isn’t a lot of hard work involved.
I’ve heard horror stories of novice website investors who purchased a site with the idea of sitting back and simply watching the money roll in with zero effort on their part.
Instead, all that happened was that new sites came along, started to outrank them in the search results, and took much of the site’s traffic with them.
When you start getting less traffic, you usually start to see less revenue, and in the worst of those horror stories, the investors pretty much tanked their investment until it was worth far less than what they paid for it.
In other words, if you’re serious about generating a solid ROI from website investing, be prepared to put the work in.
Is Buying a Website a Good Investment?
The big question is whether putting in the work to recoup a return on your investment is worth it.
The answer is yes, yes, it is.
On leading website investment marketplace Flippa, sites like this one in the pet niche sold for over $40,000 after making a monthly net profit of $1,000+.
Flippa even shows us that a site doesn’t have to be raking in thousands of dollars every month in order to be sold.
This gardening niche website generated a fairly small sum of just $26 per month, but even that sold for $1,000. I’m not sure who bought that one, but if I were them, I’d already be getting to work on adding new content to that site to turn that $26 per month figure into a much higher one.
Meanwhile, over on Empire Flippers, this website which is monetized via a combination of direct eCommerce sales, display ads, and the Amazon affiliates program, is currently on the market for over $1.5 million.
To put all this another way, buying and selling websites can prove to be a highly lucrative endeavor.
What are the Most Profitable Types of Websites to Invest In?
One look at any website marketplace will soon reveal that it’s possible to make money with just about any type of website if you’re prepared to put the work in.
That said, some websites do tend to be more profitable than others.
In my experience, the following three types of sites tend to produce the biggest ROI.
eCommerce sales topped $5.7 billion in 2022 alone, with that figure expected to rise to over $8.1 billion by 2026, so it’s no wonder that so many website investors target eCommerce sites.
At the top end of the food chain, Victoria’s Secret took over the online clothing subscription website Adore Me for over $400 million.
Elsewhere, another look on Empire Flippers reveals a whole host of eCommerce websites on the market for anywhere from several hundred thousand to several million dollars.
2. Niche Blog Sites
I love blogging, but that isn’t the only reason I’ve primarily focused on blogs throughout my website investing career.
The other reason is that they can make you some serious money with the right keywords, strong enough content, and enough traffic.
Top bloggers can generate thousands of dollars per month through various monetization methods, and it isn’t unheard of to hear of investors buying up blogs for well over $50,000.
One news website I came across in the tech and business niche is currently on the market for over $75,000.
If you’re considering starting a blog to flip it for profit, check out my guide to the most profitable website niches.
3. Review Sites
It’s said that as many as 93% of shoppers turn to online reviews before making a purchase.
Review sites can capitalize on this by writing honest, high-quality reviews of products and services and earning commission fees by sharing affiliate links to those products and services.
Depending on factors such as the site’s age and how much recurring income they generate, some review sites can sell for anywhere from $4,000 to $40,000+.
What are the Best Places to Buy and Sell Websites?
If you’ve been paying attention so far, you’ll notice that I’ve already introduced you to two of the biggest platforms for buying and selling websites.
Empire Flippers is my preferred platform as it does a better job vetting website owners to ensure they’re legitimate before adding their site to the marketplace.
If you’re looking to buy a website, this provides the reassurance that you will not get ripped off.
If you’re selling, going through the website vetting process proves to buyers that you’re the real deal. That kind of buyer confidence can go a long way to helping you make a successful sale.
Flippa doesn’t offer the same kind of verification process, but it is a great place to find sites for sale at a much lower price than Empire Flippers.
If you’re starting your website investment career on a small budget, this may be the best place to start.
Other top platforms to buy and sell websites include:
- MicroAcquire – Best for SaaS (Software as a Service website)
- FE International – Best for high-value websites
- Shopify Exchange Marketplace – Best for buying and selling Shopify stores
- BizBroker – Best for getting help with preparing your website for sale.
What to Look For When Buying a Website?
If you’re in the market to buy a website, the following key factors will help you to determine whether that site is worth investing in.
If you’re planning to put your website up for sale, these factors should give you a good idea of how profitable that site is likely to be.
1. Site and Domain Age
The older the site, the more valuable it’s likely to be. This is why I typically hold onto websites for at least a year after I launch a new one or purchase an existing one.
It gives the site and the domain name time to age so that I can show potential buyers that it has a long history of generating traffic and revenue when selling it.
When buyers see that a site has been consistently producing results for a year (or preferably more), it tells them there’s a good chance that it will continue to produce results after the sale.
2. Traffic Numbers
Simply put, a website that consistently generates solid traffic numbers is more valuable than a website that hardly attracts visitors.
If you’re a buyer, you don’t just want to look at recent traffic but also long-term trends.
If the traffic levels have been relatively steady for some time, that’s a good sign that they’ll continue to remain that way (unless you put the work in to grow your site). If the traffic numbers have increased over time, that’s also a good sign that the site is connecting with visitors in some way.
If the traffic levels are spiraling downwards, however, that’s a good tell-tale sign that the site isn’t really offering what people want and, thus, is going to pose a bigger challenge when it comes to recouping your investment.
3. Revenue and Monetization Sources
Naturally, one of the most important questions anyone should ask when buying a website is how much money it’s making.
Look at the long-term revenue reports for the site and also dig into which methods are being used to generate that revenue.
Again, this should give you a good idea of how easy it’s going to be to turn a profit on that website.
How to Calculate a Website’s Worth?
While these tools can give you a rough ballpark figure, I don’t recommend that you use them as your only method of determining your site’s value. In my experience, they’re not always the most accurate, and the figures generated can vary significantly from platform to platform.
In one example, I used both Worth of Web and SitePrice to look up the value of a website I’ve been working on. One platform valued my site at $1,449. The other valued it as low as $400. That’s a huge difference in anybody’s book.
An easier and more accurate way to determine how much you could price your website for is to multiply your average monthly revenue by either 24 or 36.
If you’re making $1,000 per month, you could reasonably assume that your site would generate $24,000 after 2 years or $36,000 after 3 years.
Therefore, you’d price your site between $24,000 – $36,000.
How to Maximize Your ROI on Website Investing?
Whether you’re building up a website to sell it or you’ve just invested in a new website and you plan on keeping it as a long-term source of income, there are a few simple-yet-effective things you can do to ensure you generate the biggest possible return on your investment.
1. Keyword Targeting
Use keyword research tools to find low-competition keywords and target those keywords with optimized content to start drawing in traffic.
2. Optimize Your Monetization
If your site is monetized through display ads, it may be a good idea to experiment with their positioning to boost your income. If Google Adsense provides those display ads, you may even want to consider switching to a different ad network, such as Ezoic or Mediavine which generally produce better results.
If you’re monetizing through affiliate marketing, consider what you can do to improve your landing pages or other affiliate content.
3. Tackle Your Technical SEO
An easy way to increase your traffic is to take care of technical SEO aspects such as mobile responsiveness, site speed, and overall user experience.
The faster a website loads and the easier it is to use, the more likely your visitors are to stick around and engage with your ads, affiliate offers, or other monetization methods.
Frequently Asked Questions About Website Investing
How long does it take to flip a website?
After you buy a website, I recommend waiting at least a year, if not two, before you attempt to sell it.
This gives you plenty of time to build up the traffic and revenue to maximize your ROI.
Is domain flipping still profitable in 2023?
Domain flipping -a process of buying and selling domains- can still be profitable, though you’ll likely make more from your sale if that domain is attached to an income-generating website that you can sell with it.
How to Invest in Websites: Key Takeaways
Buying and selling websites remain as profitable in 2023 as it ever has been, but it’s by no means an easy way to get rich quickly.
To sum up, everything I’ve shared with you today, you’ll have the best results if you follow these five key steps:
- Use website marketplaces such as Flippa and Empire Flippers to find websites for sale
- Analyze both short and long-term traffic and revenue numbers to determine if a website is worth the investment
- After you purchase a site, hold onto it for at least a year or two
- Spend that time adding quality content to your site to boost traffic and revenue
- Calculate your website’s worth by multiplying its average monthly revenue by 24 or 36 before putting it back on the market.
If all this has inspired you to start investing in websites, but you’re not sure how to monetize your new investment properly, here’s my guide to the most effective ways to make money from a website.