In this episode of the Domain Magnate Show, join Micheal Bereslavsky as he chats with the Founder and CEO of Blackbook Investments, Mohit Tater. Listen to them chat about how Mohit got his start, some memorable deals and what is next for Blackbook Investments.
GUEST BIO:
Mohit Tater is a serial entrepreneur, investor and consultant with business experience from around the world. He is the Founder and CEO of a successful investment firm, Blackbook Investments, and an expert in alternative asset classes, having generated phenomenal ROI for his clients over the past few years.
SKIP TO THE GOOD PARTS:
- 1:10 – 6:41 Mohit Tater talks about how Blackbook got started.
- 10:39 – 12:25 Mohit talks about the Blackbook team and hiring locally.
- 13:14 14:15 Mohit reflects on Blackbook’s most memorable deal.
- 18:01 – 20:05 Mohit talks about where Blackbook finds its deals.
- 30:47 – 32:33 Mohit shares Blackbook and Empire Flippers news.
- 40:06 – 42:01 Mohit chats about what’s next for Blackbook.
SHOW TRANSCRIPT:
Michael Bereslavsky 0:11 Hello, everyone. Welcome to this episode of Domain Magnate Show. Today we have with us Mohit Tater, from Blackbook Investments. Hi, Mohit welcome.
Mohit Tater 0:23 Hey, Michael. Thanks for having me. Finally, good to be talking after a long time.
Michael Bereslavsky 0:28 Yeah. So we’ve been chatting for, for quite some time. Yeah, I think we’ve known each other for a few years now. And we’ve exchanged a bunch of messages. We’ve had a mastermind together for some period. So it’s quite nice. Yeah, so it’s great to be able to reconnect and talk more. I know quite a few things happened with your business in the past year or so as well. So looking forward to catch up. So for an intro kind of to get started. Can you just tell us a little bit more about about what you do, in general for our listeners?
Mohit Tater 1:10 Sure. So basically, I run and manage portfolios of content sites, in short, and that through my company, Black Book Investments, and the backstory, I’ll just give you a quick, you know, overview of the backstory, how it came about. So I graduated from college in 2011. And then right after I joined a startup, I took a job with them as a Content Manager. And it was an up and coming startup, and it’s actually a unicorn right now. And people tell me, you know, had I stayed there, I would probably, you know, have made shit ton of money, but that’s alright. I’m happy I had the freedom. So yeah, so I, you know, decided pre, you know, pre decided that I’m just going to do the job for one year, and then I’m going to quit. So, which is what I did. And during that one year, when I was working the job, you know, in the evenings, I was, you know, learning how to build websites, how to blog, you know, WordPress, all of that stuff. And why I chose to do that. That is because I’d read a bunch of books, you know, four hour workweek, Rich Dad, Poor Dad, and I was wanting to, you know, do something that would give me the freedom of time, freedom of location, like we all do. And I, you know, like, there’s nothing better than the internet to help me achieve that, basically. And that’s when I turned to the internet to help me, you know, achieve that dream, business slash lifestyle. And then, you know, like, let’s start building websites. I mean, that’s the first step towards building an online business. So I started doing that started building sites from scratch, start blogging, but I could never make any money from all of that like I did, I was added for over a year and a half. Even after I quit my job, I was still added for about six more months. And before I decided that, you know, it’s not working, I have to do something differently. Which is when I chanced upon Flippa, and I saw that, you know, people are buying and selling sites that are already making money. And the multiples were quite low back then, like I could buy sites for 10-12 X monthly. So I had some savings. So what I decided was, you know, I took the plunge, I bought a website for about $2,500. That was my first acquisition. It was a social media marketing service, basically, you know, to increase your followers and like, and all that stuff. It was quite the rage back then. Almost 10 years ago. Yeah. So how about that four to $2,500, I ran that for six months, to grow that I actually use my, whatever marketing skills I had, I grew that site, through the business made like three times the money while running it, in the six months I had it for and then after six months, I sold it for like 12K or something. So I made a nice chunk of change during those six months, and that was more money than I could probably, you know, make my job like, even if I work for two, three years. And that was a game changer, you know, that made me believe that this thing works. You know, this is not like, like a scam or something, make money online is legit, if you know what you’re doing. And then you know, after that, I bought my next site. I was like $4,000 or $5,000 did the same with that. And slowly I started building up confidence. And I started buying multiple sites, creating a portfolio small sites, not anything big or fancy. And in 2013, when I sold the first sight, I always wanted to go to the US so I you know took the proceeds, went on a three, four month long trip, vacation, whatever to the US had a lot of friends there I met almost all of them. I was staying with a friend of mine in downtown in midtown Manhattan. And he happened to be working on wall street with an investment banker. And he couriously asked me, what are you doing? What do you do? I told him what I do. And then he was like, you know what, let’s do it together, you know, I want to buy a site too. So I’m like sure we can do that. So that’s how we seed the idea of Blackbook was born. So we bought a website for my friend, which I started managing. And he started getting passive income from that from my management. And then once he saw within a year that, you know, he had the money coming in and good returns coming in, he he bought another site. Of course, I helped him, you know, do that. And then he got his friends and family also involved.
Michael Bereslavsky 5:56 And how long ago was that?
That was in 2013 and 2014. Yeah.
Oh, nice.
Mohit Tater 6:02 So every, like, six, seven years ago, he got his friends involved, he got his family enrolled, we had a bigger pool of money to work with, I started buying low five figures, mid five figures, you know, slowly stepping up. And they, you know, I was able to, you know, give them good returns, because the multiples were low back then, you know, so they were like, really happy getting 30, 40% ROI on their money after my fee. And then officially, I launched Blackbook in 2014. Because I had more and more people coming up to me and asked me what I was doing, and if I could help them do it. So that was the backstory.
Michael Bereslavsky 6:42 Yeah, that’s, that’s very nice. It’s very similar to how I got started as well. I was doing different things the same time, building some sites, trading some domains, other things, and also started buying some small sites. Yeah, it made some profit. And I just continued. So it’s very interesting. And it involved Flippa as well. So just to jump quickly to now. So in this past 10 years or so, if you had to guess how many websites have you bought or sold? What would be some of your biggest deals?
Mohit Tater 7:18 Past eight years, I would say I’ve bought like, probably over, I’ve done over like 100-150 deals. Ranging from as low as $2,000 to I think as high as our biggest deal was somewhere close to 454K. Okay. That is the price range you plan on and anything and everything in between. Right now, our sweet spot is 100K to 400K, basically, that’s quantum sites in that price range. That’s where we play it. And especially because the multiples have gone up. So you can buy much 450K these days.
Michael Bereslavsky 7:58 So it’s sort of similar for us as well. Now, it’s kind of similar range. And so the biggest set from 2,000 to like 450 was the biggest, like about 100 deals. Pretty good.
Yeah, yeah, you could say that we do have some sites in our portfolio that we haven’t sold yet that might be more valuable than 450. You know, could be over 600, 700. But we haven’t sold them. So we don’t know yet. But yeah, basically is multiple. Yeah.
How many sites are you managing currently in your portfolio?
I think I’m managing three portfolios, three claim portfolios in one of my own portfolio. So between all of these, I think there are about 18 to 20 sites at the moment that we’re managing.
Yeah, makes sense. Sounds nice. And do you have them managed by your own team, your source some things?
Yeah, so I prefer hiring full time in house. And it’s a tough job to find good people, smart people to you know, work with you full time. But I’m lucky enough to have found smart people who are like site managers. That’s what we call them. And they run an operating site. Like they own it, basically, they’re responsible and they’re answerable for whatever happens to the site. They have Junior SEOs working with them to help assist them with whatever they need to do on the site. And then we have of course, the tech person we have like, writers, you know, we have multiple writers in house and we also outsource to writers who are subject specific, you know, niche experts, basically. And what else…we have an editor to basically all the people that would be needed to you know, just run a well oiled machine content machine. We have them on payroll. And link building has been a tough, you know, to hire for link billing roles, like usually people who build links, they know their value. So sooner or later they you know, just you know, graduate to charging for link rather than, you know, being on a payroll. So that’s like a charm, basically. always on the lookout for other languages. Yeah.
Yeah. And but where are you based now currently?
So I am in my hometown city called Jodhpur, in India. It’s in the western part of India state called Rajasthan. And my city is also called the blue city or this fun city.
Nice. So is that an advantage being based in India that you’re able to hire people for lower salaries locally, but then compared to people who are in US? I have to do remotely?
yeah. So yeah, we haven’t hired in the US, per say, at least not full time. And salaries in India definitely are not as high as they are in the US or even Europe, I would say, but they are definitely at par or even above like, Philippines or or at par with Eastern Europe, by the way. So at least for the smart people that you want to hire, you know, I mean, sure, you can get someone for $200 a month, but you might not know how smart they are, you know. So good people do cost more money. But yeah, that has been an advantage. And more than I think that’s half the story. I think the communication the timezone is the other half. That’s why I prefer hiring from here, also. So that way, and I can get the team together, you know, at times, and they can have fun, they can bond with each other. So I like to deploy a hybrid model where we have a co working in New Delhi. And we also work remotely. So we have a hybrid model, basically.
That’s nice. And I was always wondering how much of a difference it makes if you’re able to hire local and have people like actually meet each other because our team are remote. We actually have some people in India as well and in the Philippines, and most of them haven’t really met each other. We haven’t done any meetups yet we plan to at some point. But then everyone is in a different time zone, it can be challenging. And I think if you’re able to get people to get a problem helps with team building a lot. So that’s a big difference probably.
I sometimes do struggle to hire good people. Because I am like, if I’m limiting myself to India, but I think if I am actually always hiring, I’m always hiring. You have a funnel, and people are coming in all the time. So you know, we always have a good set of people to choose from basically.
That’s how it should be. Absolutely. Because you never know, the best people are usually the ones that already have a job or the ones that don’t apply.
They’re not looking maybe Yeah, they’re not even looking maybe you know.
Yeah. So tell me about your, your your best deal. If you had to pick one, the one that was most profitable, most exciting, you know, your best deal.
Yeah, I think this deal was the…
–The most memorable.
Mohit Tater 13:20 Yeah, a content site we bought, it was one of the very first sites we bought in 2014, one of the very first ones. And it was an investor owned site. We bought it when it was making about $400 bucks a month. Yeah, $300 or $400 bucks a month. Around 2014, 2015. So we kept it all this while, maybe changed hands, I think once or twice in these last five years. But we were able to grow that from $400 a month to almost like it’s touching 10K a month right now. So I would say in terms of the growth, the the multiple the x, you know, like how, like we were able to 20, 25 X that even though it took us a long time, it was slow. It was not slow, but it was fast and steady growth. Basically, I would say 25 x in five or six years is not bad. I would say.
Michael Bereslavsky 14:16 Yes, that’s that’s pretty impressive growth. And you mentioned that change hands, what do you mean?
So basically, when one investor wants to exit out of the deal, I am usually able to sell that site within my investment network. You know, we don’t have to go to the market. Because we have more investors wanting to buy sites with us. So I rather sell them a site from an existing investor a site that I know, you know, that I trust, rather than buying a new site for them basically. So I can confidently tell them that you know, this is a good site, we should buy this.
And that makes sense. And how do you price it? How do you define it?
I don’t price it, the market like the seller and the buyer, they do at least know the market valuations like the multiples. Otherwise, they educate them on the market multiples. And then it’s just a matter of negotiation how much the seller and buyer want to whatever price point they want to agree on, like, I do mediate, but I cannot represent both parties. So I just let them be and you know, I suggest I advise both of them, and what would be a good price for this and if it’s good for you to take it or not. So, yeah.
It makes sense.
Mohit Tater 15:34 It’s up to them. It’s up to them. Yeah. Like, I don’t have any role there.
Michael Bereslavsky 15:38 Can you tell how do you structure the compensation or the fees? For your management for investors for managing sites?
It’s fairly simple, I think it’s pretty similar to what you guys are doing. So we charge a 10% finder’s fee, which is a 10% of the deal size that we buy. And for that amount, we do everything, do all the groundwork to find the deal based on your preferences, if you have any niche preference or whatever price range, we do all the due diligence, we talk to the seller, we get on calls with them. We see on the we check on the revenue proof all of that basically, do audit if needed. And then once everything checks out, we do the negotiations, actually, on the behalf of the buyer, who are we representing basically, and my aim is to save them more money than I’m charging them. So if I’m, you know, on our let’s say, on $100,000 deal. If I can save them like 15K can get that for 80 $585,000 and charge them 80 $500. On top of that, that is $93,500. They still save $65,000 basically. So that’s the idea behind that. And that’s the one time fee. And then once we start the management of that site, it’s equal split basically in the income of the site.
Okay, so that’s the, let’s say, he bought a site for $100,000. And it makes $3,000 per month. So what they pay the investor what do you charge?
It’s a half, we just split it equally, they’ll see they get $1,500, I get $1,500.
Make sense for the expenses of growth expenses, they come out of your department or separate?
They come out of my Blackbook share, basically. If the investor wants to put in more money, they want to go more aggressive. They’re free to do so. But then they would have to, you know, fund the extra additional growth basically.
Okay. Yeah, that’s similar to our structure as well. And where do you mostly find deals with days, that’s, I think that’s the biggest challenge for most people.
I don’t have like, there’s no shortage of investors. But there’s definitely shortage of good deals, to be honest, what I’m seeing these days is that sites are being created and sold by professional marketers, basically, more and more professionals are doing it. And they’re doing it with the sole purpose of selling them at some point. Which is different than what I would like to buy, I would like to buy a site that has been, you know, created by, let’s say, an individual who is enthusiastic, who’s passionate about a certain topic, and you know, they started as a hobby. And it grew out of proportion and grew more than they expected it, and now they can handle it. So I like more kind of those deals, but those are tough to come by these days. So I do have all the regular channels like you have all the brokers marketplaces, Flippa, Empire Flippers, FB International, Quiet Light. So we have like, subscribed to all these listings. And, but more and more I’m inclining towards you know…and what we’re also doing is getting our own private deals. So inbound and outbound both basically, inbound in the sense that people now know that we buy sites because we’ve been doing it for like, almost quite some time now. And people know that we close quick. That’s one thing people come to us because they don’t want to, you know, go to the brokers and pay a fee or, you know, spend that time doing all the due diligence if they know that I can close within a few days. They’re happy to do that and maybe take a lesser amount, because they’ll get a fast close and outbound in the sense that you know, if an investor has a preference that they want to get into this niche, then we’ll shortlist a few 100 sites in that niche that fit our criteria or metrics. And then we’ll do outreach campaigns. Asking besides ownership guarantees under site. Yeah.
Yeah, that’s very similar to my view as well. There are so many sites now that people just build, they build them, and they rank them quickly, you know, using expired domains, and using a lot of very aggressive SEO, building up quickly backlinks and PB ends. And these sides go up quickly. And every time I see a graph like that, you know, I know it’s gonna come down soon. And, and just everywhere, there’s so many sites like that most of Empire Flippers listings for content sites, and all the other brokers as well. So it’s definitely getting much more difficult to find this type of solid businesses with our passion projects. And we also put a lot of effort looking for them. Yeah. Like the recently one of the recent deals, we bought a website, that’s been around for about seven years. And it’s a kind of a small niche in education. And, you know, when you look at the website, you immediately see the difference that, you can very easily now distinguish between something that’s a passion project and something that’s that just like, built to sell. Yeah, exactly. So that’s always exciting finding those, and then you see that stability in, like in traffic and revenue over a few years. And all the natural links, like thousands of natural links, but it’s getting more and more difficult to find.
What I’ve seen, Michael, what I’ve seen, Michael is that, you know, 80% of the listings are either their income trajectory is going like crazy, you know, up, and they want to sell they want to cash out, because they know it’s gonna come down. So I’m like, I’d be aware of those. And the, you know, within that 80%, the other half of this sites that are going hmm, and the people know that, you know, it’s not going to recover, you know, it’s not going to come back up. So let’s get out of it while we can before we can’t get anything for it. So even those sites I don’t like much, because I don’t want to spend so much time, you know, just know, recovering without even knowing that if it’s gonna recover or not, while paying close to market price. I don’t want to do that. So there’s very few sites that you know, you’d see that have a steady slow growth. Because most of those sites people don’t want to sell basically.
Yeah, and yeah, exactly. Recovering can be really difficult. I mean, unless you know that it’s something very specific, then you just kind of try a bit of everything. But it can be tough. And I think there are probably still some sites you can occasionally find, even among brokers and marketplaces with that sort of businesses. And then you have to act quickly.
You have to do a bidding war, sometimes the bidding war more then.
I think that’s what drives the multiple up days. That’s kind of an interesting state of the market. But the other interesting part of that, also is that there are so many buyers, that many of them really just, well, not that experienced, to put it mildly. And so they see the trajectory, and I just think that’s amazing. It’s gonna keep growing and they buy it. But usually it doesn’t.
They get their hands burned. And then they like, they lose faith in the asset class. And then they are, you know, very skeptical when they come to you. So it’s like, a re education basically.
Yeah. We’ve had that. I remember we had one investor, that the first question he asked me on the call, was, like, he invested his income store before. So he asked me, How do I know you’re running a Ponzi scheme? And that happens, too, sometimes. So yeah.
There you go. There you go. In fact, interestingly, just since you brought up income store, I kind of I’m always there are people that will guarantee returns, like, you know, if you’re guaranteeing me, 1% or 2%, I’m gonna take it. I’m alright. I’m not going to take you but I’m going to believe you that quicker, you’ll definitely give me 2%. But if you’re guaranteeing me anything about 12%, you know, I’m going to be skeptical, you know, guaranteed income. So I advised a couple of my friends to you know, not, you know, invest with the income store, because I said, you know, it’s a major red flag that they’re guaranteeing me 15% ROI. But I guess the company was just too big, you know, to be thought of as something, you know, scandalous. And they went ahead when they had the choice of going with me, you know, they still thought you know, maybe it’s a bigger company, maybe they’ll do better and they went and then they had a bad experience. They ended up losing on 100K that they invested and I then educated them, you know that this is how things work. And I’m still ready to help you. But the site that they bought for you is, it was not the site that you know, was making the money. So, yeah, I mean, it’s a gray area, but there is a lot of education, that means that is needed in this space for new investors. Otherwise, you’ll end up burning money.
Yeah. I think the big challenge also is they try to manage too many websites. They have hundreds of websites. That’s really difficult to do.
It is. Yeah, I struggled with 20 sites, just think of managing hundreds of sites, you know, it’s like managing hundreds of businesses literally.
Yeah, one one Google update could wipe out everything too, especially in smaller websites.
Exactly, exactly. Because they all ultimately are dependent on Google, mostly the content site. You know, it’s not like physical businesses, where if you have a restaurant and you have a barber shop, and then you have whatever laundromat that they’re not correlated. But, you know, one Google a bit can wipe maybe majority of your sites, and you’d not even know.
Yeah, it’s risky. Did you have that happen? By the way, how did the last update go for you December 4th?
It was a mixed bag a couple sites took a big hit. Most of them were steady, actually, just like, you know, maybe 5% up, or 5%, down. And actually, two or three of them actually took really off in December. So I think this one was really different than what we’ve seen before. So we’ll probably wait until the next update happens, you know, so I’m not panicking yet. But again, it’s just a part of the business. And I educate, I try and educate my investors as much as I can. And I always say that, you know, only invest the money that you’re ready to lose, they’re willing to lose. You know, if you come with that mindset, then you’ll do well, otherwise, you know, you’ll always be against.
Yeah, that certainly happens. Updates are frequent now. But for us, I think the biggest lesson was just to to be even more strict if criterion to try to avoid all these sites with if aggressive face or with overly commercial content. And all these similar things, expired domains.
When you do that, you’re hardly left with any sites to buy.
Yeah, that’s a challenge. And then you start looking at other verticals as well.
Yeah, yeah, exactly. You gotta do something because you have money. Sometimes, you know, I’ve had to turn down investors, when I was not able to find that place for them in two, three months, because I did not find anything that was good enough to buy, and I didn’t know what to buy anything for them, you know, that would just, you know, I know that they’ll get hit in the next update. I could have made my commission by the, you know, I think goodwill is more important than just temporary profit, I’d say.
Yeah, we had that quite often as well. I had to turn down many investors. And then we had investors that just like, kept emailing, you know, every week or so. Like, okay, we have cash can have a website for me to buy. And, what’s even worse, and, you know, in that sense, is that sometimes we do find a deal, and then we show it to them. But before we buy it in our final due diligence, we find some issues and and recommend them not to proceed. So then we don’t actually buy them. And, and that can be a little frustrating for an investor. But I think in the end, it’s best to just know that if you’re buying you’re buying good deals. Yeah.
Yeah. I mean, keep your cash, don’t buy bad deals. That’s what I would say.
And so have you considered looking into other avenues like buying SAS businesses, FBA? Anything else?
Yes. So we are looking to branch out later this year, early next year, into, my personal preference is to go for SAS. Because I tend to, you know, I don’t like dealing with physical products, goods, inventory management, all of that. So I’d rather go with SAS, which is more scalable and less dependent on Google. So that’s the logical next step for me. So this year, I’m going to be trying and putting a team in place to be able to handle SAS businesses. And ideally, we’d like to go and start offering SAS businesses, to our investors starting next year, basically. So yeah, definitely looking into that.
Yes, I think SAS can be really good. The challenges, if you buy something that’s really complicated, then yeah, you might get stuck with dealing with all the development.
I know I know. That is the pros and cons. As far as e commerce, I think I might not want to do it myself. So what I do have in mind is I was talking to a friend of mine who also does content sites. Any he also does e com, so maybe, you know, we could combine forces when I could take care of the content, part of the things. And we can maybe launch a brand like a B-C brand under that content brand, basically, and expand into e commerce. So if two people who have different expertise, one in ecom one in content, can, you know, make a brand out of just the content site? So that also is an avenue I’m exploring.
Yeah, that makes sense. So what what are your current plans? So what are you currently working on?
Mohit Tater 30:47 Yeah, so as you probably would have known, would know that the Empire Flippers came out with their investor opted for a program called EF Capital and Press Capital recently, and Blackbook was selected among the first cohort of six operators. So we are one among the four operators who would be buying content sites. So that’s what’s happening right now, we are hiring for that basically, at the moment while the raise is happening, so that we are ready from day one, when we have the funds in. And then we can go all in and you know, by the sites that we want to and not have to wait for buying first and then hiring you know, because the initial month or two, they’re most crucial, basically, after the acquisition. So that’s going on, we’re hiring, looking at deals. That’s what I do mostly these days, just, you know, looking at deals, day to day, I’m not as involved in the day to day management of the sites as much as I am overseeing the purchase and sale of the assets and managing the team. Other than that, we’re also doing a small group buy of a million dollars for, Blacbook’s private clients, because a lot of investors, you know, don’t have the 100K, that is needed to work with us, which is the minimum that we do for one on one deals. So we had to come up with the group by which would be a minimum of 25K. Which would allow more people to participate in investing in web sites. So we’re doing it in two parts 500K and 500K. So that finally is almost done now. So we’ll be starting to acquire sites for that as well. So these two things.
Michael Bereslavsky 32:34 Nice. And how is it structured? Can you tell us a bit more about the combine?
Yes, the group rates are fairly straightforward. The revenue is going to be split into three equal parts. One part will go as dividends to the investors, one part would go to Blackbook, as the management fee, and one part would go back into the growth of sites in the form of content in the form of links, link building campaigns, whatever it is that cost basically. So that’s an the upside would be shared equally 50/50 between the investors and Blackbrook. When we have that, so it’s fairly Yeah, fairly simple. So basically, we’re doing it based on the revenue, so investors exactly know how much they will be getting. They’re not doing on the profit basis, basically. Then we’d have to explain, you know, this is what an expense was necessary, these expenses was unnecessary, you know, so when it’s on the revenue basis, we just, you know, $100 bucks come in, they get the receipt, clean and simple.
And then what happens if you don’t use the one for the for growth? If you don’t have enough, like, if you have to have more money for growth or if you have too much?
Yeah, so we probably return it back to investors at the end, or we’ll use it for, you know, let’s say if we, if everyone agrees, and if you know, you want to buy more assets using that capital, that’s an option, if everyone agrees to that. Otherwise, we’ll you know, once you’ve done growing the sites, putting the money that you know, is needed, or not overspend, it will just probably return it back at the end of the…basically when we liquidate the sites.
Yeah, absolutely. And it’s only for one website or do you buy several websites.
Yeah. So so 500K is not that big an amount these days, to be honest. So we’re shooting for two to three sites. Yeah. And then see how that goes basically.
And how is it structured and terms of preperation, accounting and LLC?
It’s Yeah, it’s…LLC is basically one would be the holding company in which all the participating members, investors will be members. The other one will be the management LLC, which would basically take the management fee on Blackbooks behalf, basically. And investors would be putting in the money in the holding LLC. So fairly straightforward. I think most of the people in this domain are using the state assembly structures.
Yeah, sounds good. Do you also put some capital into into the group buys on 2000 deals with investors?
Yes, yes, we’re putting about 10% of my own money, same as I did with Empire, not 10%. But close to 7%. With Empire always good to have skin in the game so that investors are also going to have peace of mind that you know.
Yeah, sounds good. Yeah. So that’s pretty similar. So it’s interesting to chat, because we are both doing some very similar things. And we probably deal with more or less the same group of investors and buyers and sellers. And similar challenges here.
Yeah, I think there’s very few people like us who are doing this for others, like finding sites. And there are tons of people who are buying and running sites for themselves. But do for others. I think they’re fairly a limited number of people who are acting as operators and actually working with investors right now.
Yeah, absolutely.
Yeah, yeah.
Yeah, we have dom and it’s nice to be able to chat frequently as well. He’s doing similar things.
yeah, I mean really, yeah, he’s just killed it. He crushed it in 2020. I’m really, you know, inspired by him.
Yeah, so it’s a cool industry, it’s growing quite rapidly. Well, where do you think it will end up in a few years, what’s next?
Mohit Tater 36:58 I think the multiples are gonna go up for a few more years, I’d say that. And to the point would come where the risk would be just too much for the returns, I’d say. And then we’ll probably come back down a bit and stabilize. Because right now I can see deals on, you know, Empire, or even other brokers lifting at 4 x yearly, 48, 50 x monthly, which is, which is kind of crazy. Because like you’re looking at, like 20, 25%. Now, if you’re able to maintain that, but the risk is high, because you know, if something goes off, you know, you’re down to 10%, or maybe 5%, or with the last Google update, like entire, like sites were wiped out, like huge sites, you know, from doing 10K a month to maybe $200, $500 a month. So there has to be a balance in the risk has to be worth the reward. Or the reward has to be worth the risk. So I think it’s going to go up the multiple, it’s going to go up for a bit and then maybe come down a bit and then stabilize. And then I think within five years, the industry is going to be more mature than it is right now. And more and more people, I think it’ll be more operators like us, and even more individuals, you know, buying and selling sites, it could probably become more of a asset class maybe not as common stocks and bonds, but still fairly common comparatively today. Yeah.
Michael Bereslavsky 38:28 Yeah. Yeah, I think that I agree with that. Although I think that the multiples would kind of drift off a little bit so now what happens is you don’t have a lot of difference between businesses with a really solid and well established a low risk versus the businesses with a very new and very like aggressive growth. So I think that’s probably gonna be probably going to see more of that as the market becomes more mature to buyers investors learn more about it and it’s yeah because it’s very strange to see often we see businesses for like 3 or 4 x, then you’ll profit that that have many years of stable history and insane multiple you might see site so that just like a year old.
Mohit Tater 39:16 Yeah a year, year and a half, you know, exactly and even other than that in the pricing multiple that’s used is also very…you know some sometimes the six month multiple that’s being used, you know, LC exam last nine months, so, yeah, so basically a poor sellers want to maximize their sale value. So if there is any growth, they want to you know, just take the last month, the highest growth and you know, priced and based on that, whereas, of course, buyers want to see a 12 month period, you know, and average that out. So, it’s always a tussle.
Michael Bereslavsky 39:54 Yeah. So, where do you see your business going next what’s your next kind of benchmark in terms of deals or, or even your team?
Mohit Tater 40:06 Yeah, so I think what we have set our goals, so our team specializes in content, which is what I like to continue doing, and create, basically a media company. And that could be owned by investors and my own, you know, my own funds or my own money and could be a company that something like dotdash, or internet brands, if you’ve heard of those, and own a portfolio of solid authority sites, established sites, you know, having viewership readership in the millions basically across the properties, basically, and specialize in three to four verticals. So that’s on the media part of things. As for blackbook, I can see ourselves branching out into SAS, at least if not a e com in the next year, and also developing in house expertise to even build SAS tools maybe to complement the content sites that we have. And also be able to manage bigger SAS businesses because there is money in SAS, in the sense that investors are more willing to put in money in SAS businesses. And you can find SAS businesses at all price points. Whereas for content sites, you don’t find them after a certain price point. So if you want to ask business for 10 million, you can buy one today, if you want for 20 million, do you want for 2 million, there’s always a SAS available for any price point that you want to buy it for. and institutional investors, private equity, those people are also interested in more than just condensates. So I want to basically go that route and build a portfolio of SAS businesses and package them up and, you know, sell to private equity basically. Ultimately, that’s what I’d like to do.
Michael Bereslavsky 42:02 Yeah, I think that’s what FE International do is solve their funds. Right? They have the SAS funds.
Mohit Tater 42:09 Exactly, exactly. Yeah. So you just need to have the expertise before I can get into that.
Michael Bereslavsky 42:16 And what ranges are you targeting? Do you plan to go for, like more businesses similar range, like six figures low mid, or look for bigger businesses above a million?
Mohit Tater 42:28 High six figures, low seven figures. That’s what I’ll be targeting next. Because I because, Michael, the thing is, it’s easier to manage a one $1 million business than 10 $100,000 businesses, as you would know, probably better than me. And I rather spend my money, my energy, all the funds resources on one or two businesses or than 20 businesses, because then maybe the none of them would have a chance to grow exponentially. Whereas if it’s one or two businesses, they probably have a good chance at growing much faster.
Michael Bereslavsky 43:01 Yeah. I think that’s kind of the the unspoken secrets in the industry that the management, the management costs, they don’t scale linearly, like as you get bigger sites that it becomes it doesn’t become much more expensive to manage.
Mohit Tater 43:19 Exactly. You might as well manage bigger sites, you know, why a small site? The ROI is not that high for us as operators in that case.
Michael Bereslavsky 43:30 Yeah. And how do you structure the management? Do you are you involved personally in operations of sites, or do just have the team like each person assigned to a specific site?
Mohit Tater 43:42 So like I said, there’s site managers for each site. Usually, one site managers manage to three sites, they have two people assisting them to junior SEOs assisting them, I come in when a strategic decision needs to be made regarding if there’s any investment to be made into site, or if any campaigns need to be run. Or if a site needs to be decided, if it needs to be sold, or you know, something’s been bought. That’s where most of my time goes talking to investors. And, but whenever we do acquire a site, I am definitely involved in the strategy that we do for the site. So we make a plan for the next, you know, three to six, we make a six month plan, basically. And I’m involved in that. And then once the plan is done, my team takes it off from there and executes it. If something goes wrong, then they come to me.
Michael Bereslavsky 44:37 And how do you find people like that the managers of the people who have experienced managing sites of their own or they just do they go for training through the company?
Mohit Tater 44:47 Yeah, so interestingly, so these managers are skilled people, they have run websites, they have their own affiliate sites, actually encourage them to do their own thing also. And also even tell them if you have a good idea just come to me, we can do it together, you know, I’m always up for that. And that’s why maybe, you know, they’re happy working with us. So I, I really, you know, you can’t hire site managers, you can’t hire people who have, you know, run affiliate sites or even bought or sold a few sites. I’ve tried that the normal job description and posting on job boards doesn’t help. So what I do is what I’ve had success with is basically hiring on Facebook groups basically have these like, like authority hacker pro Facebook group, or affiliate lab, Facebook group, because those people in there actually have spent money invested money into those courses, and they are trying to do something, or maybe they have actually done something. And maybe they’re at a stage where they’re not able to scale. They’re just stuck at one point. And they need more resources, more guidance, more training, to, you know, scale that hurdle. And that’s when, you know, I chat with them and see there’s a synergy for them to work with us. And most of my water site managers are actually affiliate marketers themselves, you know, they have fun sites, they have grown sites, and they know the ins and outs, basically. So they know what it takes to run a site and grow a site, basically. So yeah, yeah. And then LinkedIn has been somewhat helpful also, at times.
Michael Bereslavsky 46:23 That’s good. And do you do you incentivize them with some portfolio performance as well?
Mohit Tater 46:30 Yes, yes, yes. So whenever we buy, whether it’s making that time is the benchmark that they have to scale, wherever they are able to grow the site, from there on, we share a certain percentage of the growth with demands so that it keeps them motivated. And I also want them to be entrepreneurial. So they can see that, you know, their efforts are paying off not just to Blackbook and to the investors but to themselves as well, basically. So it’s always good to share that. I believe there’s enough to go around for everyone.
Michael Bereslavsky 47:06 Yeah, sounds good. Yeah. So to sum it up, what are your thoughts on Bitcoin right now?
Mohit Tater 47:16 I’d say, buy while you can, buy while you can. Just hold tight. It’s going to be a long ride. Actually I just did a article yesterday on on medium, I’m gonna send you a link to that, you know, just on what you asked. And hopefully your readers, your viewers, listeners can know.
Michael Bereslavsky 47:36 So you’re holding a bunch of Bitcoin right now?
Mohit Tater 47:39 Yeah, I do. I used to do consulting back in 2017, 2018. Like mining related consulting. So I’m just holding all of that never spend I don’t even know I haven’t even looked at my wallet in the last two or three years. Yeah, so I just let it sit. I’m not buying actively. But yeah, whatever I have I’m just letting it sit. I’m bullish in the long run. Yeah.
Michael Bereslavsky 48:06 Good strategy. All right. Well, thank you Mohit. Do you have any any other things you wanted to mention or or let our listeners know about what you’re doing?
Mohit Tater 48:19 Yeah, so I mean, yeah, nothing as such but just hit me up if you want to just talk about websites and geek out you know talk evaluations. I’m I’m always up for that. Hit me up blackbookinvestments.com or my personal type of mohittater.com. Would love to chat always good connecting with like minded people.
Michael Bereslavsky 48:42 Thank you Mohit. great to chat and until next time.
Mohit Tater 48:48 Thanks, Michael. Likewise, talk soon. Bye.
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