Profitable Websites: Is it Better to Buy or Build a Website?

Buy or build sign

This is a guest post by Stacy Caprio.

Buying a site or creating a site: Which is more profitable?

I dove headfirst into website investing a few years ago in 2016, after reading a guest post on Spencer Hawe’s Niche Pursuits site that mentioned the website buying and selling platform Flippa.

However, before I started buying websites, I’d already been creating sites of my own for over a year, with little to no success monetizing them.

Little to no success is relative, of course. Does creating a site and monetizing it to have it make only $700 in profit over the course of 3 years count as a success?

Maybe to some people, and having a few extra hundred dollars a year is always nice, but not to those looking to leave their job or live full-time on their website income.

It was only after I started purchasing sites that were already successful and making a large chunk of money on their own that I was able to learn and internalize the principals behind a successful site.

What makes a site successful? How does a site get traffic? What are the best ways to monetize a site you own?

These were all questions 2015 me had no idea how to answer, and this was reflected in the lack of revenue-based success in the first few sites I created.

The 2017 and after version of me had much better answers to these questions, much due to the already-working sites I’d purchased and learned a lot from.

We’ll go through my journey creating my first income-hopeful site from scratch to purchasing my first successful revenue-generating site, so you can take a look at what goes into creating a site on your own versus buying a site that is already making money.

Income Case Study: Creating a Website from Scratch in 2015

I created my first intentionally monetizable website in July of 2015 when I was stuck in a corporate job I was hoping to break free from.

I thought owning a profitable website would be a great ticket out.

I decided to create a “passion-based” site based on something I was interested in, since all the online gurus said following your passion was the best way to make a living online.

Spoiler alert: Following your passion may earn you a living, but if your focus is to make money, try focusing on making money instead of passion, since the quickest path to a goal is a straight line and not crossing your fingers hoping people will pay you to do what you love.

If you must make a passion-based business, realize that:

  1. You will likely have a lot more competition, since there will likely be a lot of people already doing what you love.
  2. You need to make a concrete plan of how you’ll drive traffic and start to make money. Without this you’ll likely just wander aimlessly.

My plan to make money from my first site was simple, and due to my lack of experience and knowledge, not very good.

The plan consisted of creating a YouTube video about my “passion product” that would drive millions of organic views.

My naïve 2015 self simply assumed that the video would be viewed millions of times, which would then drive millions of people to my website, which would then drive millions of purchases and dollars of revenue, and then I could retire early on a beach somewhere.

Because I lacked experience owning a site that actually made money, my plan lacked substance and did not work out as I so optimistically expected.

Around the time I created the website, I also created what I thought would be the “golden ticket” YouTube video with millions of views, and uploaded it July 8, 2015.

The video itself has received over half a million views to date, which is not a complete failure in terms of driving YouTube traffic. However the video was a complete failure in terms of my site goals, particularly revenue goals, and has driven negligible traffic to my site over the course of three years.

My overall earnings were negative the first full year.

I actually stopped checking my Google Analytics and CJ Affiliate accounts because nothing was coming in the first 10 months.

Finally in April of 2016, 10 months after I had created my site and my Youtube video, I got my first affiliate sale and earned $7.

I was actually very happy because it was a sale, and I had started to think that would never happen for me.

Needless to say, I started checking my accounts more, and the next month when I received another sale I was happy again, but thought the whole process was going quite slowly.

Since this was my first site and I didn’t know how to run a site that actually received traffic and money, I didn’t realize I should be adding more website content and videos. This entire time, I had simply uploaded around 10 starter articles to my site and a handful of initial videos and nothing more after that.

With my severe lack of content, it was quite a miracle I even started to get traffic and a few sales.

I started getting money from YouTube ads and Adsense two entire years after setting up my first site, around August of 2017.

The YouTube and Adsense ad revenue turned out to be substantially more than my affiliate commissions and was fairly regular.

The ad revenue has made up the biggest portion of income from this site and still returns profit today.

I never added much more content to this site and will likely not, since the RPM is fairly low and I don’t see much opportunity to monetize it independently unless I go after brand partnerships and sponsorships, since the industry is very regulated.

I learned a lot about site monetization from creating my first site, including that ads can be a significant revenue source, even more so than affiliate links in some cases.

I also learned how little I knew about monetizing a site, and this helped me realize, along with reading blog posts about people creating and buying sites, that to get to the next level, I would either need some type of mentor or a crash course in a successful site which I could get by purchasing one that was already working.

First Created Site Earnings & Expenses

I created my first website in July of 2015 and uploaded my product video to YouTube on July 8th, 2015. You can look at the below chart to see the revenue progression which starts with a few negative months and slowly works its way up to a slight profit each month.

You can see full monthly revenue details by channel as well as expenses below:

Adsense EarningsYoutube EarningsCJ EarningsTotal RevenueDomain Name ExpenseHosting ExpenseTotal ExpensesNet Profit
March 2017$0.00$14.13$5.40$19.53$1$5$6$13.53
April 2017$0.00$14.40$0.00$14.40$1$5$6$8.40
May 2017$0.00$23$0.00$23.00$1$5$6$17.00
June 2017$0.00$15.67$0.00$15.67$1$5$6$9.67
July 2017$0.84$16.30$0.00$17.14$1$5$6$11.14
August 2017$16.51$19.54$0.00$36.05$1$5$6$30.05
September 2017$19.02$16.07$0.00$35.09$1$5$6$29.09
October 2017$36.32$16.57$0.00$52.89$1$5$6$46.89
November 2017$41.22$14.808.34$64.36$1$5$6$58.36
December 2017$32.42$15.87$0$48.29$1$5$6$42.29
January 2018$31.51$12.79$0$44.30$1$5$6$38.30
February 2018$47.98$8.34$0$56.32$1$5$6$50.32
March 2018$28.20$0.00$0$28.20$1$5$6$22.20
April 2018$17.52$0.00$0$17.52$1$5$6$11.52
May 2018$18.76$0.003.336$22.10$1$5$6$16.10
June 2018$15.38$0.00$0$15.38$1$5$6$9.38
July 2018$24.93$0.0013.92$38.85$1$5$6$32.85
August 2018$15.58$0.00$0$15.58$1$5$6$9.58
September 2018$20.46$0.00$0$20.46$1$5$6$14.46
October 2018$46.60$0.004.788$51.39$1$5$6$45.39
November 2018$24.03$0.00$0$24.03$1$5$6$18.03
December 2018$19.77$0.00$0$19.77$1$5$6$13.77
January 2019$14.47$0.00$0$14.47$1$5$6$8.47
February 2019$20.46$0.00$0$20.46$1$5$6$14.46
March 2019$20.11$0.00$0$20.11$1$5$6$14.11
April 2019$32.69$0.00$0$32.69$1$5$6$26.69
May 2019$27.16$0.006.674$33.83$1$5$6$27.83
June 2019$23.64$0.004.635$28.28$1$5$6$22.28
July 2019$26.73$0.00$0$26.73$1$5$6$20.73
August 2019$23.79$0.00$0$23.79$1$5$6$17.79
September 2019$38.55$0.00$0$38.55$1$5$6$32.55
October 2019$55.64$0.00$0$55.64$1$5$6$49.64
Total Profit$726.16

Proof of ad revenue screenshots below:

CJ Affiliate Revenue screenshot

Youtube Revenue screenshot

Adsense revenue screenshot

The site I created made $726.16 in total profit over the course of three years.

The best thing about creating a site from scratch is that you get to keep all the profit, in my case all $726.16 of it.

When you buy a site, you are starting at a net negative that you have to make back before you start earning “true” profit.

Income Case Study 2: Buying an Already-Profitable Website in 2017

One year after creating my first website from scratch, I decided to get more serious and put more skin in the game.

Owning a profitable site was something I wanted, and I knew I didn’t have enough knowledge to create one as successful as I wanted on my own.

In 2016 I decided to purchase a site and spent a few days messaging sellers on Flippa to get more information on their sites.

I bought a site and then found out the seller had lied about how much it was making. That site was a complete sunk cost but I still learned how important revenue verification is when buying a site.

The second site I bought ended up being based on a fad and traffic, along with its revenue, tanked a few months after I bought.

Even though the first two sites I bought didn’t work out I was still serious about buying a site that was working.

The third site I bought ended up being a great deal and I both learned and profited a lot from it.

It was making money right off the bat, and taught me a lot about what makes a successful site generate revenue.

I was able to play around with ad networks and partnerships and increase revenue right off the bat.

Traffic to this site was the largest I’d seen before, and it opened my eyes to what was possible if you had a devoted audience and so many articles that even if search engines only sent a handful of traffic to each article each day, you’d still have tons of traffic.

It taught me how traffic can be more important than monetization when buying a site, since you can always monetize a site more fairly easily, while the hard part is building a loyal audience and traffic.

Owning this site also taught me how to sell a site and that selling a website can actually make you more than you originally paid for it.

I learned more from buying a successful site than I had from creating my own because the site I bought already had processes in place that were working, whereas my own created site was limited by my ability to see how it could be successful.

First Successful Purchased Site Earnings & Expenses

MonthSite AcquisitionAd Network AAd Network BAd Network CAd Network DAd PartnershipTotal RevenueHosting/Domain ExpenseDomain ExpenseTotal ExpensesNet Profit
May-17$ 145.48$ -$ -$ -$ -$ 145.48$ 14.99$ 2.50$ 17.49$ 127.99
Jun-17$ 282.78$ -$ -$ 249.37$ -$ 532.15$ 14.99$ 2.50$ 17.49$ 514.66
Jul-17$ 76.04$ 164.81$ -$ 271.92$ -$ 512.77$ 14.99$ 2.50$ 17.49$ 495.28
Aug-17$ 36.85$ 424.42$ -$ 194.87$ -$ 656.14$ 14.99$ 2.50$ 17.49$ 638.65
Sep-17$ 39.31$ 563.81$ -$ 453.58$ -$ 1,056.70$ 14.99$ 2.50$ 17.49$ 1,039.21
Oct-17$ 27.07$ 511.44$ -$ 100.97$ -$ 639.48$ 14.99$ 2.50$ 17.49$ 621.99
Nov-17$ 6.59$ 591.66$ -$ 149.83$ -$ 748.08$ 14.99$ 2.50$ 17.49$ 730.59
Dec-17$ 25.97$ 637.00$ -$ 125.00$ -$ 787.97$ 14.99$ 2.50$ 17.49$ 770.48
Jan-18$ 19.98$ 449.26$ -$ 106.45$ 500.00$ 1,075.69$ 14.99$ 2.50$ 17.49$ 1,058.20
Feb-18$ 33.87$ 410.10$ -$ 111.16$ 500.00$ 1,055.13$ 14.99$ 2.50$ 17.49$ 1,037.64
Mar-18$ 32.67$ 635.25$ -$ 500.00$ 1,167.92$ 14.99$ 2.50$ 17.49$ 1,150.43
Apr-18$ 21.00$ 438.29$ -$ 141.97$ 564.00$ 1,165.26$ 14.99$ 2.50$ 17.49$ 1,147.77
May-18$ 34.27$ 421.27$ -$ -$ 455.54$ 14.99$ 2.50$ 17.49$ 438.05
Jun-18$ 46.43$ 589.47$ -$ 161.90$ -$ 797.80$ 14.99$ 2.50$ 17.49$ 780.31
Jul-18$ 36.61$ 425.78$ 42.88$ -$ 505.27$ 14.99$ 2.50$ 17.49$ 487.78
Aug-18$ 44.15$ 417.95$ 112.43$ 157.40$ -$ 731.93$ 14.99$ 2.50$ 17.49$ 714.44
Sep-18$ 38.82$ 533.75$ 99.87$ -$ 672.44$ 14.99$ 2.50$ 17.49$ 654.95
Oct-18$ 47.55$ 624.90$ 169.36$ 160.78$ -$ 1,002.59$ 14.99$ 2.50$ 17.49$ 985.10
Nov-18$ 52.67$ 684.62$ 94.04$ -$ 831.33$ 14.99$ 2.50$ 17.49$ 813.84
Dec-18$ 48.55$ 639.82$ 107.02$ 173.28$ -$ 968.67$ 14.99$ 2.50$ 17.49$ 951.18
Jan-19$23.04$264.59$23.87$ -$ -$ 311.50$ 14.99$ 2.50$ 17.49$ 294.01
Total Site Profit$24,288.54

Proof of revenue ad network screenshots:

ad network screenshot

ad network screenshot

ad network screenshot

ad revenue screenshot

I bought this listing for $6,400, so I ended up making $17,888.54 in total profit from the site when you take into account what I paid for it ($24,288.54-$6,400 = $17,888.54).

This means I received a 379% ROI from the entire purchase ($24,288.54/$6,400 = 379%).

Over the course of 2 years, this means I was making ,944.27 pure profit per year from this site alone, which was 99% hands-off profit for me since the content was user-generated.

You can see how this site was much more profitable than the first site I created from scratch. It’s also easy to see how the profits could start to add up if you purchase a lot of sites similar to this one, or start creating ones similar to this one once you learn the ropes.

Buying Versus Selling a Site: Conclusion

There is no hard and fast answer to the question, what is better, buying a site or making one on your own.

You as an individual or a company have to assess the answer to that question by looking at your own experience and goals.

If you’ve already created a few successful sites from scratch, you can likely keep doing what you’re doing, with no need to buy a site as a learning experience unless you’re diving into a new niche and want a peek behind the curtain of what an already successful site looks like.

If you have been making sites for years that are stuck pumping out $10 a day like 2015 me, then you may want to consider purchasing a site to get a head start and begin to learn in a hands-on way what makes a site start to earn more.

You’ll need to think carefully about your own experience levels and goals before diving into any site purchase or creating any site from scratch, but both are worthwhile experiences.

I’d recommend everyone try buying at least one site in their lifetime and creating at least one website during their life as well, if only for what you’ll learn from doing both.

Let us know your own experiences buying and creating sites from scratch in the comments below, and which you prefer.

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