Making Money with a Web Site: ProBlogger Writes…

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In this post I want to present some visuals on how I’ve expanded one of my blogs and diversified its income streams. * How do I expand upon my blog and add different elements to my site? * How do I move beyond the basics of making money with AdSense on my blog?I’m asked these two questions a lot and in this post I want to share, with some visuals, how I do it on one of my own sites.

How I Diversify My Site and Income

Would you invest in this deal? All the risk, no ownership, and a profit cap, to boot!

Tyler’s looking for some ‘suckers’ who are willing to be investors for his latest project, a Flash based site. The terms are weird:

I am basing the following options on the project costing $5,000:

Investment Return Buyout

$1,000 15% for 18 months 5x
$2,500 37.5% for 18 months 5x
$5,000 75% for 18 months 5x

I will only accept investors up to when the cost of the project is met (Ex. If 2 investors want in at the $2,500 level then it will be closed there).

The Return is based on site income, whether it be from advertisements on the site or paid memberships.

If you do the math, the site would need to make a total of $6,666 (bad omen? haha) during the first 18-months in order for you just to break even. This works out to an average of $370 a month. Therefore, if the site manages to make $13k during the first year-and-a-half, you’ve doubled your investment.

There will be a buyout clause, where at any point I can buyout the shareholder for 5x their investment. This buyout will be on top of any return they have received so far. For example, if an investor invests $1,000 and after 5 months I want to buy them out, they will keep whatever Returns they have made so far, plus $5,000 (5x) for the buyout.

The 18-month Return timeframe will begin once the site is finished its development and goes live to the public. (More)

I can’t understand this at all, Tyler.

Are you borrowing the money or asking for an investor? Really. If you are borrowing you should offer repayments as part of the plan, a potential interest rate to evaluate the risk involved.

If you’re looking for an investor, then you really ought to be looking for someone who can bring both cash and expertise (ideally). If not expertise, at least cash. But then you must sell them part ownership.

Are you looking for a payment from future cashflow? Then if so, what is your security?

I can’t understand, from a potential client’s position, what you are looking for, nor can I see any real reason to invest. You don’t cap my risk, but you cap my profits. It really seems like you want to have your cake and eat it, with respect. If I were doing this, I would cap the risk, so my investor’s feel better, and reduce/remove the cap on the profits. Given your situation, though, the relative small size of the investment, why don’t you just pony up the money yourself, and avoid all this hassle?

If I were a BBC Dragon, and if I had to listen to this, I would reject it out of hand for the reasons outlined. There’s no product to showcase, no example, no cashflow projections other than airy-fairy numbers, no estimates of expenses (server costs, design costs, admin costs), no security for investors (not even partial ownership), nor do you even clarify if the return of capital comes from income or after costs.

So what is this? I would love to know. Let me know.

Pandora, Emusic, iTunes 0 vs KKBox, and 3:

It’s all about the dollars, cents, pounds and pence, isn’t it? After all, that’s what you’re all fighting about, isn’t it? That’s why you aren’t really entering non-US markets, … you don’t think Asian markets have enough cash, do you? Well, here’s my cash. I put my money where my mouth is: but you guys didn’t want it. Pity, I’ll reward those companies who do want it.

Who wanted it? Well, here’s my list of top three online music providers who were delighted to take my money, and provide me with great music to listen to. So drum rolls, please!

 KKBox wanted my money, so I put down a subscription with them. And they made it so easy to pay: I could have paid in any of a dozen different ways, including just going to the local convenience store, and handing over my cash! This is a screenshot that includes some recently popular songs. The only caveat was that I had to set my default language on my PC to Chinese, which of course, broke one of my blogging applications. Never mind.

KKBox Software

No problem. Last.FM made it really easy, too. So I plumped to spend money with them. Nothing needed to download, but it works. And there are software programs you can use if you need to.


I also put my money with Sky.FM who wanted it. Nothing to download here. Just play the stream in your favorite player.

sky-fm logo

It’s not that I didn’t want to give it to Emusic – they wanted too much with too many conditions attached, including paying for a catalogue that I couldn’t access – well done, Sony BMG!; iTunes wanted the money for the products (iPod, iPhone, iTouch, etc.) but didn’t want to provide the services to my country of residence; Pandora just shrank from the challenge of facing too many lawyers, without a good excuse.

After all, when did lawyers run a company? In fairness, lawyers are paid to respect the law, to follow the law and to help understand and interpret the law for other people. But, it seems that they are increasingly being used as an excuse by business leaders to hide behind.

Legal Music Alternatives

So I put my money where I could; and I’ll likely start buying even more CDs courtesy of Amazon, etc., … by the time that Emusic, iTunes, and Pandora wake up to the HUGE LEGAL opportunities they’ve missed, it will be too late for them to capture the market in many countries. Why? Because while they can wait, other hungry companies can’t, and neither can audiences. The world won’t wait for Pandora, Emusic or iTunes to grasp what’s being offered in terms of markets. Instead, these markets will take their ball, and play another game altogether.

Think that it hasn’t happened in Taiwan before? Think again.