EP12: Website Investing 101 with Stacy Caprio of Her.ceo – Domain Magnate

EP12: Website Investing 101 with Stacy Caprio of Her.ceo

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Today we’re joined by Stacey Caprio, founder of Her CEO. In this episode we talk about what she’s doing with Her CEO, how she got involved with investing in profitable websites, as well as her background that led her to this point.

 

GUEST BIO:

Stacy’s background is in online marketing, specifically paid ads and SEO during her 9-5 roles. Investing in websites is what allowed her to break free from her 9-5 job, and she’s hoping to share some tips that can help you learn more about how to spot winning website investments and avoid the duds.

SKIP TO THE GOOD PARTS:

  • 0:14 – 0:38 Colton introduces Stacy Caprio and Her CEO
  • 0:46 – 1:30 How Stacy got into website investing while reading Niche Pursuits
  • 1:48 – 2:13 Stacy’s corporate background
  • 2:25 – 3:08 Why organic traffic is much more important than paid traffic
  • 3:40 – 4:45 The types of website you sould keep an eye for
  • 5:00 – 6:42 Identifying opportunities for increasing site revenue quickly
  • 6:54 – 7:27 Examples website investing quick wins
  • 7:51 – 8:24 Recommended private ad networks (Monumetric and AdThrive)
  • 8:41 – 9:54 Why you should consider guestposts + Stacey’s direct email, hear it here!
  • 10:16 – 11:25 The only conditions you should consider when using paid acquisition and why.
  • 12:05 – 13:30 When is is appropriate to use paid advertising
  • 13:55 – 16:17 Learning from experience: website investing hiccups.
  • 17:09 – 17:54 Protecting yourself from sellers who are falsifying website performance data.
  • 18:33 – 20:18 Advice to people starting out
  • 20:43 – 22:37 Kinds of websites you should stay away
  • 23:17 – 25:32 Hiring a firm that specializes in acquiring and managing sites vs doing it yourself
  • 26:15 – 27:28 Website investing vs traditional investing
  • 27:48 – 29:19 Her.ceo: Building a brand

SHOW TRANSCRIPT:

Colton Moffitt 0:14 Today we’re joined by Stacy Caprio. She’s the founder of Her CEO, she’s spoken with Michael recently, and we wanted to get a better idea of what she’s doing with Her CEO, how she got involved with investing in profitable websites, and just generally her background that led her to this point. So Stacy, thank you for joining us today. And I really look forward to learning more about you. Why don’t you tell us kind of how you got to where you are now and we’ll go from there.

Stacy Caprio 0:38 Sure. Sounds great. Thank you for having me today. It’s great to get to have this conversation. But I actually started investing in websites when I was at my nine-to-five job and I really wanted a way out and I was thinking, if I could only make say an extra $1000 a month or whatever, just a small amount I was thinking I could quit and then focus full time on doing other things. So I actually read, I was reading a lot of online income blogs and other things at the time, including Spencer Has Niche Pursuits where I found out about website investing and a site called Flippa. So that was when I decided to make my first website investment and it kind of just went from there. So that’s kind of my backstory.

Colton Moffitt 1:39 So in your kind of day job, so to speak, you had been doing stuff that was involving digital marketing, right. So you had some familiarity with this?

Stacy Caprio 1:48 Yes, my focus was more paid ads like AdWords, Google, Facebook ads, those type of things, but I did have some background with SEO as well and that definitely helped and just knowing how to go on WordPress or do analytics and all that stuff was really helpful, I think when I transitioned into this line of work.

Colton Moffitt 2:13 That makes a lot of sense. So in terms of kind of how you approach these investments then, were you looking for paid traffic at first, or were you saying, hey, look, I want to stick with organic based on what I’ve read, how did you approach that?

Stacy Caprio 2:25 Actually, having a background in paid traffic made me want to focus more on organic, because I’d seen that you can pretty much get like a two times maybe even six times return on ad spend a lot of times but it’s not…if you’re looking for just like something that’s going to give you a lot…a really high profit percentage each month. You don’t want to be really running paid ads, they’re more just for growth or to get some part of profit and I was really looking to get a lot of revenue with a low amount of spend at the time. So that’s kind of why I focused on sites that had traffic, mostly from organic search.

Colton Moffitt 3:08 That makes sense. You know, extremely high margins. Obviously, there are some risks that come along with that. But if you had the confidence, knowing you could do paid traffic if you needed to I’d imagine that must have been an interesting balance. So, you know, how does that fit into your overall mindset and approach to these, you know, you mentioned high margin is important to you. You mentioned that organic traffic at the time was important to, you know, having been doing this for a little while now. Why don’t you just kind of tell the audience more about your investment strategy and how that’s evolved since you started.

Stacy Caprio 3:40 So I think I kind of buy similar sites to what, at least, I got the feeling that you guys purchase. Sites that do make revenue from traffic, and ads and affiliate revenue. I found those to be more hands-off in management and it takes less bookkeeping, and they’re a little bit more passive, not that they don’t need the same amount of work. And I prefer sites that get traffic from the US, just because ads companies tend to pay higher for that type of traffic. I..

Yeah, I think that those are some of the main things I look for, as well as potential for growth. I like to have sites that have high domain authority, because they’re easier to add more content to and get it to rank more quickly. Yeah, those are kind of the main things I look for.

Colton Moffitt 4:45 Gotcha. So when you talk about getting it to rank more quickly, or you’re going to add more content to them, how do you identify personally, how do you identify those good opportunities where you’re confident you can substantially increase the value right after you acquire it?

Stacy Caprio 5:00 It’s important to first verify to make sure the value is actually there in the first place. And once you kind of verify that, you can look to see like, do they have a ton of ads on the page, and if they have a ton already, maybe you will be able to add new ads or videos. And if they don’t, you can see an opportunity to kind of increase revenue by just simply putting a few more ads on the page. And if you see they’re running AdSense, you can kind of take that as an opportunity. Well, if I switch to maybe this ad network, I know I can maybe double revenue off the bat, which I’ve actually done a few times for different sites, I bought. I think so just kind of looking at the current monetization situation and saying, Can I add more affiliate links like are they only monetizing with ads? Can we put a product and can we do something else? Also, just one way right off the bat you can usually increase revenue is you can kind of play around with putting it on a CDN and compressing images and increasing site speed. Yeah, I mean, they’re just quite a few things you can do. If there’s like a high money page that’s not ranking, you can kind of rearrange the site architecture or give it a few more internal links and just get a quick boost. So I think it’s pretty much as creative as you want to get at this point, but just kind of thinking about different things you can do to just get some quick wins and set your site up for long term success as well.

Colton Moffitt 6:42 Yeah, that makes sense. Quick wins always feels good. Do you have a particular story that comes to mind where you just you made a change? You woke up the next day or you checked back a week later and you’re like, awesome, so glad that worked.

Stacy Caprio 6:54 Yes. So the first one that just pops into my mind. I’ve actually done this twice. The sites were being monetized with AdSense and I’ve actually just switched it to an ad network that I knew had really good RPMs, like better than AdSense for those niches. And in both cases, the revenue like doubled overnight, and it’s always just kind of fun when you see that, and then you’re like “wow, so I really did just double the revenue and decrease the time to get the money back by half”.

Colton Moffitt 7:27 Yeah.

Stacy Caprio 7:28 I don’t know if that’s something you guys kind of do in your strategy too.

Colton Moffitt 7:32 Oh yeah, we love that. That’s always good. So you know, you mentioned that you’ve got some ad networks, you’ve had good experiences with. You look at those opportunities when you’re evaluating sites. Are there any that you want to kind of call out and say they’re really good to work with or do you like to keep that kind of closed for competitive reasons?

Stacy Caprio 7:51 Oh, no. Yeah, I can share some. I kind of like the ad network I’ve had a lot of success with; Monumetric, and like AdThrive. I also I do have a few partnerships with individual ad networks who pay like flat fees and stuff. And I mean, they don’t really have recognizable names or anything. So that’s just something you can also cultivate if you want that type of sponsorship.

Colton Moffitt 8:24 Yeah. And then that’s an interesting kind of balance. So you get approached by the smaller networks, and sometimes you can make a good deal with them. How do you feel about guest posts because sometimes we buy a site, we get a lot of emails coming in people asking for guest post kind of have to assess the quality, is it a good fit. What’s been your experience with that?

Stacy Caprio 8:41 Yeah, I actually I really like putting guest posts on my site and if you look at Her SEO, you’ll see I have quite a few guest posts just they really do have to be high quality. So like when someone sends an email and they have grammatical mistakes in the email or it just looks really rushed and botched, you can tell they’re just doing it for the link, I’ll usually not really even respond to those. But when someone has a thoughtful response and like it will fit within the niche, I really love that because it’s free content. And you don’t have to write it. I mean, you have to edit it, but it’s usually pretty high quality when the person really puts in the effort so I yeah, I’m a fan of accepting guest posts definitely.

Colton Moffitt 9:28 Cool. That’s good to know.

Stacy Caprio 9:29 A plug for if anyone who is listening wants to write on Her CEO. You’re more than welcome to and I’d love for you to reach out.

Colton Moffitt 9:38 Oh great yeah, if they were going to reach out is it just like slash contact or what’s the best way for them to get to you?

Stacy Caprio 9:43 Oh, I yeah, I’m You can reach me at my Gmail at [email protected]

Colton Moffitt 9:54 Okay. And we’ll repeat that again at the end. But for those of you who are distracted, you got your ADHD and you’re not going to finish the episode now, you know. Go ahead and contact her at that email address. As far as the professional experience that you have, and a lot of that being paid traffic, do you see yourself going that direction in the future? Are you really happy with the focus you have on organic right now?

Stacy Caprio 10:16 Yeah, that’s a good question. I’ve been thinking about this actually, recently, because I was thinking, so many of my sites rely on organic traffic so heavily, that if that gets taken away, it’s going to really hit my like income, I pretty much have to start from scratch. So I’m kind of thinking about how to build a brand where people will direct search and just kind of, I’ll be able to contact them even if Google decides to, like, blacklist me for some random reason. But the paid part, I would actually consider, especially if my sites got wiped from Google, I’d probably try buying some ecommerce sites and just going back to that, because like, I know I can do it pretty well. But paid has just gotten so saturated too over the past few years, everybody’s on the main platform. So prices have just gone up and it’s not something I really want to jump into. But if I was kind of forced to, if Google kind of took favor away from me, then I think it’s something I would consider.

Colton Moffitt 11:25 Gotcha. So that brings up a couple interesting questions. Now, I know that you’re focused on the organic now and that makes sense. But for those people who are listening, and they’re, they’re constantly looking at, you know, over the past few years…I used to work for Flippa as account manager and I would see so many Shopify drop shipping sites, just constantly listed. That’s been less so these days. But I’m just curious what you would give in terms of advice for people who are thinking I’m going to buy this business, which depends a lot on Facebook ads or Google ads, and I’m going to be able to learn it. Is that is feasible? Should they look for an agency, should they run away screaming? How would you approach that?

Stacy Caprio 12:05 I would say it is actually feasible. I would make sure, if they do that, not to buy at too high of a multiple. Maybe look for something closer to 20 times the monthly profit valuation, because you just want to take away the risk, they want to be able to make that back as soon as possible in case they weren’t able to learn it. But in a lot of cases, the owner, if they’re successful at that will have the campaign’s already up and running. The hardest part about making those types of campaigns is really setting them up and then you do continuous testing and evaluation, of course, but if the owner has a successful campaign running, you can pretty much just let it run on autopilot and that was actually something in the agent when I was in the agency world we would have clients just kind of quit because they had the campaign setup and it was doing well and I mean it can kind of run on autopilot for a while without being like seeing huge, bad changes, at least for a few months and there are a lot of resources to learn it and the interfaces are pretty intuitive. I mean, you’re not going to do as good of a job as someone whose background is in that, but I would say, go for it, maybe start with a site that’s not as expensive and see if you can do it and then if you can just kind of work your way up from there.

Colton Moffitt 11:25 Gotcha. Now, you mentioned that you would look back at that way of doing things but only if you really had trouble with organic so I’m curious; you know we’ve all made mistakes, you know, as I’ve been brokering in the past. I’ve been working with Michael on the buy side, we don’t always get things right. So do you have an example or a story where you’ve really learned your lesson the hard way?

Stacy Caprio 12:05 Yeah, I do I have. So there are two sites I pretty much bought that…and I’ve kind of talked about this too in my site in more detail if people want to check it out…so the first day I bought, and you’ve probably experienced this when people try to list either on Flippa or sell to Domain Magnates, but people will inflate or just flat out lie about a sites revenue. And the first time I went on Flippa the site that I first initially purchased the seller said it was making a lot more than it was each month and I just kind of believed it, I didn’t even like, check it. So I bought that site and ended up like barely making any money. But like it was a very cheap site so like I didn’t lose a ton of money, it was like very small so it basically just taught me the lesson that you should always verify revenue and that’s something I’m actually grateful for that I learned then because I know I’m very careful about verifying every little piece of data before buying a site and if I had a good experience at the start, maybe I wouldn’t have been with my bigger sites. So I think that’s really important. And then the second big mistake that I personally made was, so I was really really desperate I think to buy a site like I don’t think you should ever buy a sight when you’re in a bad state of mind or like desperate or like, kind of not in like a peaceful, calm, good decision making state of mind. So I was kind of desperate and so I bought like a fad trendy based site. It was like an app based site, and I was able to like double the revenue pretty quickly. That was one of the ones I did double, just changing and metrics and everything but traffic tanked after just having a few months, so I probably made back like 70% of what I bought. So it wasn’t a huge deal, but it just it kind of taught me a lesson you should always go for sites that have long term potential and use your common sense. I mean, I’m sure I could have figured that out if I just kind of thought about it a little. But that kind of goes back to like, you have to be in a good mindset when you’re buying a site and not just super desperate for a site.

Colton Moffitt 16:17 That makes sense. Definitely your state of mind and your frame going into that sort of thing. You know, it reminds me of, sometimes when I see sites related to video games or movies, you have to sit there and gauge, is this going to be popular for very long? Or is it just, you know, kind of a hype thing right now? And some games have been around for over a decade, people still play them. But I feel really bad for the people who bought Pokemon GO related apps and websites at the peak of that, because it basically just disappeared overnight and I felt bad for them. But these things happen. So when you’re approaching due diligence, obviously you said you you’ve learned your lesson about verifying financials and you know enough about traffic generation on those topics to really get a good sense of that’s authentic. But what else do you bring to the due diligence process that maybe somebody in the audience hadn’t considered?

Stacy Caprio 17:09 Well, yeah, so I always get access to the Google Analytics, always get video screen shares of revenue, and I think those are the two main things. And then also, you kind of you want to look ask about and look at their backlink profile and make sure it’s not a bunch of paid sites or PBN type stuff, because if they take away the links, that could be really detrimental. Or if the PBN gets penalized. So I think, just from an SEO perspective, you kind of want to do some due diligence before diving in, and make sure the site is built on a strong foundation.

Colton Moffitt 17:54 Right. Yeah, that makes a lot of sense. And with the pbn stuff, that’s kind of a bit of a contentious point it has been for a long time, it works, if you understand it, and you know, there are people that are quite good with that sort of thing. But if you’re a first time buyer, it can be quite risky and there are a lot of other risks that you can encounter when you’re in this process. So what are some other risks that you’ve noticed maybe other people making mistakes and you want people about, you tell them say it’s a friend of yours saying, “How do you do this? How do you make money this way?” and “Couldn’t you lose all your money?” and what kind of risks are they worried about? And what do you tell them?

Stacy Caprio 18:33 So when we say I kind of tell people, even those on my email list is, I mean, so if you buy a site that’s relying on organic traffic, and I guess I kind of talked about this Google or whatever search engine can just take it away anytime. And if you buy a site rely on any source of traffic, it can be taken away anytime. So like if it’s right on Facebook traffic, like a lot of websites used to be a few years back, Facebook changed their algorithm so the organic reach was severely limited and a bunch of sites kind of failed. I don’t know if you saw any of those, but just anything that’s based on any source even paid traffic, like once people started jumping into the game, it gets more expensive. So unless you have a really strong brand, if your site is based on one source of traffic, that’s going to be a huge source of risk so you kind of have to just decide if you want to take that on. Another thing is affiliate, if your site is based on affiliate traffic, any affiliate anytime can take away their program, or they can severely cut commissions. Even the Amazon affiliate program has been cutting commissions every year. If you have a if it’s relying on a single affiliate, I’ve seen sites I’ve been looking at where they were making double the previous year when they had half the traffic they do now, because they had affiliates just cut their program. So yeah, that’s a huge risk to.

Colton Moffitt 20:18 Yeah. Okay, so that brings an interesting point to niches, niches however you like to say it, if you’re listening, I’m sure you have a preferred way. When it comes to when you’re deciding that and you’re reviewing those Do you have a preference? Because from the organic traffic side, some are more risky than from the affiliate side some are more lucrative but far more competitive. What are your favorites and what are the ones you run away from?

Stacy Caprio 20:43 I stay away from anything that is borderline illegal type like I would never do like a gambling site or like anything that is even kind of sketchy in the eyes of the law or in the eyes of Google like I would never do a hand-gun site or anything, just because you don’t want to get anything that’s like borderline being penalized by the law or by the search engines. So I kind of just like run away from that type of stuff. I also stay. So actually one site that I had purchased was a site that had user generated content, and on one hand, it was amazing because I didn’t have to touch it and it just hummed along. The traffic was so strong, it was over 10 years old and this was a site it was getting like millions of pages a month, it was like really popular. But after I had it for like, a little over a year, I realized all the images were probably I mean, so anytime anyone takes an image, it’s copyrighted by the person who took it and so these are all user uploaded images and I realized there’s probably a copyright issue there. So I stay away from like user generated sites now or sites that don’t have, like images that were owned by the owner or a stock site. I think that’s just something most people probably don’t really think about. But it’s pretty important. I like sites that are based on content that is high quality and it doesn’t really matter the specific niche as long as I kind of understand how the site makes money and kind of understand the niche to the point where I can be literate in it. But I’m not super picky in terms of niche in that sense.

Colton Moffitt 22:37 Yeah, that makes sense. Just if you know enough to know that you’re looking at the content, its quality, it’s not outright lies, nobody’s going to get hurt. Okay, pretty basic, decent human being stuff. All right. Now, now that we’ve discussed those kind of risks and the preferences that you have, particularly somebody who’s coming at this without having your background and your familiarity with marketing. What do you think about buying a site and managing it yourself compared to working with a firm that specializes in acquiring that and managing it for you? Where you might make less as a proportion, but the longer term might be better?

Stacy Caprio 23:17 Yeah, it’s something I’ve actually been thinking about recently to both in terms of investing my own money, but also investing other people’s money kind of in a similar way that you guys do and just really considering but it’s really interesting because there are a lot of pros and cons. So for someone that doesn’t have the technical ability or the time to manage a site, I think having a service like the one you guys offer is a really great value add. One really great positive is the tax benefits. So I know that a lot of the people who have a service like Domain Magnates, the income that people get is considered passive so it’s only taxed at the capital gains rate, which is really great because the income that I get is taxed like an income bracket rate. So it can be a lot worse in terms of like the taxes I’d have to pay. So I think that’s one reason to consider it as well. I personally don’t think I will invest in the near future with a service like that just because it does… So I don’t know, what type of feed do you guys charge specifically?

Colton Moffitt 24:39 Well, that would kind of depends on the situation. We hammer that out with our individual clients, but yeah.

Stacy Caprio 24:44 Okay, because I know a specific service similar to yours called the Income Store. So they take 50% every single month for themselves even from the beginning. So theoretically, they guarantee a 15% return per year. But like, theoretically, it would take you six years to make back your investment over six years. And for me, I just think about, like, if I buy a site on my own, I can make it back in under two years, pretty much. So in that sense, it just seems like it’s not the best option for my situation. But I know if someone doesn’t have experience with that, and they want the passive income, I think it can be a really great service.

Colton Moffitt 25:32 That makes a lot of sense. Everybody’s situation is a bit different and some are more sophisticated with the marketing side of things, which is constantly evolving, and others are really just looking for access to the opportunity. You know, because we’ve talked a little bit before about the difference between this and other sort of more traditional assets. And, you know, you touched on that was someone getting 15% per year. You know, that’s actually pretty good relative to what they might get like an index fund. So how would you compare this to more traditional assets? And what would you tell somebody who does not have your background, but does want to participate in the kind of income that’s possible.

Stacy Caprio 26:15 So one thing that makes website investing but also real estate investing really attractive to any investor is you get the payouts every month, and then once you make back your initial investment, then you start getting payments that are just simply like pure profit each month. So I think that’s why I love website investing and I’m kind of attracted to like, real estate investing, although I’ve never kind of doven in there. But I think that’s because I have more experience with the websites and you can make your money back more quickly with websites which is another advantage. Websites are also kind of better than stocks in that sense, because you put your money in a stock, and it can just kind of lose its value anytime and with the websites, once you’ve made it back, you kind of get to keep it. So I think that’s a really good difference that people who want to invest in a website should kind of keep in mind because it has like, a lot of long term potential, you don’t have to worry about losing the money you’ve put in interesting.

Colton Moffitt 27:28 So I want to give an opportunity for you to talk more about Her CEO and what you’re hoping to achieve with that you mentioned before looking at building a personal brand or a brand at least you have more control over. So tell us about that. And then we’ll kind of wrap up with you being able to tell how people can work with you if they wanted to and how they should reach you again.

Stacy Caprio 27:48 Yeah, so I was attracted to Her CEO brand because I like the thought of just having a brand that people can search so I’m not as dependent on completely un-organic traffic and I also like to inspire people with case studies and how they can also make money online because that’s how I was inspired to start investing in websites. It’s also kind of fun to try monetizing in a different way because there’s just so many directions you can go with a site like Her CEO. So that’s kind of why I am excited to continue building the site. If people want to work with me, they can reach out at [email protected] or they can go to the site and sign up for I have a website buying and selling email list where I send out site deals and I also have a site email list for people who want to get entrepreneur case studies and updates on my own site progress and stuff even though I don’t send email often you can still sign up. Anyone who wants to guest post I’d love to have people. If you’ve made any type of revenue or profit on a side hustle or a business or anything, you can definitely guest post and be featured on the site and get a backlink as well.

Colton Moffitt 29:19 Great. All right, everybody. That was Stacy Caprio, [email protected] if you want a guest post, you can find Her CEO it’s her.ceo. Thanks for joining us today Stacy and we’ll talk to you soon.

Stacy Caprio 29:32 All right. Thanks, Colton. Great talking to you. Have a good morning.

Colton Moffitt 29:35 You have a good night.

Stacy Caprio 29:36 Thank you.

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