To get started earning money from websites, you have two options: build or buy a website. Both of these options have their benefits and drawbacks, and there’s no perfect answer for everyone. This article is a framework for determining which option is best for you.
Table of Contents
- Before you get started: download the workbook
- Build or buy a website: the benefits of building
- Build or buy a website: the benefits of buying
- Determining which option is right for you
- Download my Build vs Buy workbook
- Key points
Before you get started: download the workbook
Buying or building a website can be a complicated endeavor, as I have learned over many years. Over countless purchases and website builds, I have come up with a set of tools that I used for myself.
Now, in order to help you get started, I’m making my entire Website Investing Beginner’s Kit available for free. All you have to do is fill in the form below. Included in the kit is a Build vs Buy workbook that will help you decide which option is best for you.
Ready to get the Website Investing Beginner’s Kit? Click here.
Build or buy a website: the benefits of building
Are you hoping to make money with websites? There are a few major benefits to building a money-making site by yourself:
Lower initial investment
The most obvious benefit of building over buying is that building a website requires a much lower initial investment. Buying a profitable website usually costs tens of thousands to hundreds of thousands of dollars. In contrast, you can build your own website and have it running for the cost of a cup of coffee.
The high investment required to buy a website represents a major risk. If there is some sort of problem with the website, you could very quickly be out a large amount of money.
No “skeletons in the closet”
When you build a website yourself, you know exactly what its strengths and weaknesses are. But when you buy an existing website, you’re somewhat in the dark.
While the purpose of due diligence is to determine what these strengths and weaknesses are, you will inevitably miss some details. In many cases, these details may be unimportant — and sometimes, the details will be in your favor. But in other instances, you will miss some significant weakness.
Tailored to your interests
If you build a website from the ground up, you can tailor it to your specific interests and expertise. This is not necessarily true for a website you purchase and can be more important than you may think.
If you own a website that doesn’t match your interests, and you must keep it running by adding new content and handling operations, you’re much more likely to give up and drop the site entirely if something goes wrong.
I personally have faced this problem on multiple occasions. For instance, I once purchased a website that was dedicated to the MTV show Teen Mom. Although I have absolutely no interest in that show (or MTV for that matter), I purchased the site because it was making a healthy profit and was being sold at a very low multiple.
Unfortunately, the site was soon hit by a Facebook algorithm change which resulted in a major traffic drop. Instead of continuing to add content to the site, I dropped the writers and planned to write some of my own content in order to save money. Of course, since I have no interest in the show, this didn’t work out too well, and the site was soon essentially dead. I eventually simply wrote off the site and made up for the loss with other sites.
The moral of the story is that it’s important to own websites that are related to your interests — and if you build your own site from scratch, you can have much more control.
Build or buy a website: the benefits of buying
There are some very important benefits to buying a website instead of building one:
Much quicker to earn money
As you would expect, the number one reason people buy a profitable website instead of trying to build one is that they can start earning quickly.
If you build a website from scratch, it takes at least a year, and generally more like two years before you start getting enough traffic to be able to earn real money from the site. But if you buy a website that is already earning money, you will start to see returns immediately.
Lower risk of failure
Another benefit of buying a website instead of building one is that there is a lower risk of failure. By failure, I mean the very real risk of never being able to earn anything.
While many SEO experts would say that if you create enough content and do link building, you should be able to build a site from scratch in a year or two, I have seen sites that never were able to rank — even in relatively easy niches. Google is a black box, and it is sometimes the case that it doesn’t rank content regardless of the quality. I have experienced this more than once.
When you purchase a website that is already ranking in Google and receiving traffic (assuming you have done good due diligence), you have a very low risk of this type of failure. Yes, it is possible that after you purchase the website, the traffic and earnings drop somewhat. However, it’s unlikely that the drop is catastrophic.
I would argue that this is the most important benefit of buying a website instead of building.
Potential for quick profits
There is one other big benefit of buying a website instead of building one: if you find the right opportunity, you can make a large profit quickly.
There are many websites on the Internet that are under-monetized. By making some small modifications, it’s possible to see a large revenue jump almost instantly.
I once bought a site that would jump to the top of the Google search results when I published a post in a certain niche. But most of the content on the site hadn’t been updated for years. By simply changing the date on certain posts and adding a few sentences, I was able to nearly double the traffic.
There are many other ways to modify a website in order to quickly increase profits. However, these techniques only work on established websites that already have traffic and earnings.
Determining which option is right for you
Deciding whether to build or buy a website can be stressful, but it doesn’t have to be complicated. There are a few factors to take into account:
How much cash you have to spend is a major factor in whether you should build or buy a website. Most websites for sale don’t qualify for any special financing or SBA loans, so you’re generally on your own to pay for them. If you don’t have the cash to buy, you will need to build.
The worksheet allows you to input your budget.
Your financial risk tolerance
What is the nature of your budget. Is it your life’s savings, and if you lose it you’re in trouble? Or is it a small part of a larger nest egg? Or are you young and ready to take a major risk? How much of a risk you’re willing to take with your budget plays a major role in whether you should build or buy.
The worksheet below asks for you to quantify your risk tolerance.
The recurring income you need to earn from the website
How much money do you need to earn from the website? Will this be a small investment or a new career to replace your full-time job? The amount you need to earn, as well as your time horizon below, are important in determining whether to build or buy.
Our worksheet takes this into account when suggesting whether to build or buy.
Your time horizon for getting to the recurring income number above
If you need to be earning income immediately from a website, you have no choice but to buy. However, if you have 12 or 18 months in order to get to a certain revenue, you can consider building from scratch.
The worksheet below asks you for your time horizon when calculating whether to build or buy.
How much time you can commit, and how much you earn per hour
If you are building a website — whether it’s an affiliate website or an ad supported site — you’ll need to spend a significant amount of time (even if you don’t do the writing yourself). But if you don’t have much time, you will probably want to buy a website instead of building.
The worksheet below asks you to enter your hours available and hourly rate.
Download my Build vs Buy workbook
Over my many years of website investing, I put together many decision making aids. One of these is a build or buy workbook, which helped me decide whether to build or buy a website in a particular situation. And in order to help you get started, I’m making that workbook available for FREE.
All you have to do is fill in the form below, and you’ll receive my website investing tips and insights, as well as the complete Website Investing Beginner’s Kit, including the Build vs Buy workbook.
The decision of whether to build or buy a website can be anxiety-inducing. But it doesn’t have to be so complicated. If you look at a certain set of questions, you can see which option is best for you.
I suggest taking a look at my workbook for some help. Although it’s not going to be applicable to everyone, it may help you better understand your personal situation and thus whether you should build or buy.