# How one founder turned $2K into a 6-figure business, and you can too!

Channel: Rob Walling
Video: https://www.youtube.com/watch?v=27xyuVK2tgc
Duration: 16 min
Language: English
Words: 3207
Transcript page: https://viewrankai.com/tools/youtube-transcript/27xyuVK2tgc

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[0:00] [Music]

[0:07] [Music] so first of all I'd like to say thanks for everybody who actually voted for this talk here it's actually really exciting to get to share the story of my plugins unfortunately because of the nature of the talk here I'm gonna have to like omit a huge amount of detail on this so if you're interested in going deeper I love talking about this so hit me up after the talk and be happy to talk more so in 2009 I had been freelancing for more than a decade like many of you here in this room and I got tired of trading hours for dollars so at that point I said to myself well what is

[0:41] it I'm gonna do now you know I worked for a couple of startups I didn't really want to go the big bang VC funded startup kind of way so instead I was looking around and I happened to come across a post on hacker news one day that said hey we have an opening in the microphone er Academy would you like to join and I said cool I'll check it out and I was really excited because suddenly I had found a like-minded bunch of people that were kind of in the same boat that I was right here now when I actually got into the Academy I found

[1:06] that there was a pretty strong dichotomy here so on the one hand you had guys like Ruben who were trying to bring an idea into fruition starting from scratch it was some burning idea that they had really worked you know a long time to create and then there were guys like Rob who were saying no actually you can go out and buy something and then fix and flip it sort of real estate style and build a business on that well I looked at this dichotomy here from my own perspective and it seemed to make a lot more sense to me that one of those two was a better fit for my personality so

[1:41] regardless of what direction I went I knew I was going to have to deal with all three of these things right here so I had to have a market that had some kind of a problem that could be solved a product that actually solved that and a way to promote to the people that are in that market well if I were to go the build route I was going to have to do all three of these things from scratch which felt a bit daunting for me at the time or I could go the BI route and I could actually get an existing market and an existing product with some

[2:07] customers to sell to and then focus on the promotion aspect with less emphasis on the other two so given the that was the case I felt that the buyout sort of suited me a lot better now that I had an idea of sort of where I fit in the Academy I needed really some direction on how to get there so I badgered poor Rob for weeks about this and was hitting him up and saying okay well you know where am I gonna look how do I not get scammed on these sales what am I looking for and so on and so forth so basically he gave me kind of a road

[2:41] map to start with and then I knew at that point what I was actually going to be searching for for a site to buy it had to be something with some established traffic and some customers probably a poor sales funnel something that I could work on and optimize because that's part of the point of this it would have to have you know a poor design and be really ugly it also needed to have some sort of revenue with potential to grow because they didn't want to start from zero it also had to be within a certain budget so my wife and I had agreed upon $2,000 would be

[3:12] the amount of money that I could possibly lose without causing great marital discord so given that that was the case I started my search on the place at the time that was the best place to go looking and that is Flippa for those of you that are not familiar with it flip is the eBay of websites now after I had gotten all this information from Rob I sort of naively assumed that I was going to be Indiana Jones waltzing into the temple simply plucking the golden idol off the pedestal and walking out well for those of you who've seen the movie you'll remember that didn't work out so well for Indiana

[3:42] unfortunately that was my experience as well on Flippa so flippa kind of ended up a little bit more like this it's a large pile of garbage that requires a huge amount of patience to sift through an unbelievable amount of diligence to actually find something so with a little bit of encouragement from Rob and a few false starts I got a little bit deeper and finally actually found a few sites that were worth bidding on now I ended up bidding on them and I bought a couple of these sites and it turned out that they were actually really lousy business decisions I'm not proud of this but I

[4:16] bought an online cron job service thinking I was actually gonna make money on it so I ended up not losing my shirt on these particular things here because they actually gave me a great opportunity to experience what was like to rehabilitate a site from scratch and so I could improve all of the things like the marketing and the sales process you know the onboarding and so on and so forth so given that that was the case I took that experience and then in May of 2010 I came across the auction for this site right here which is for aw PCP or another WordPress classifieds plug-in now at the time I

[4:52] actually knew absolutely nothing about WordPress or classifieds themselves and I certainly wasn't altogether that passionate about it but everything else about this site actually fit my bill it had existing customers it had existing traffic I was making revenue to the tune of about $300 a month which doesn't sound like much but it certainly had some potential oh and it was ugly too so I had that going for me so the the woman who actually owned this site had it on Flippa for $3500 the auction ended without a buyer I contacted her privately after the sale and I said are you interested in selling this and so I

[5:25] said I'll give you $1,000 for it and she actually accepted my offer so now I had my work cut out for me she actually had done a lot of things that you know in retrospect none of us here would necessarily approach it this way because if you've been to this conference enough times you sort of understand this is kind of a dumb way to do it but she did a lot of things that definitely weren't working very well and it seemed to me like it was very obvious to fix them so for example the site that you just saw it didn't look very ecommerce see it

[5:55] kind of looked more like a blog so it didn't even look like you could buy something there second of all she was actually doing all of her sales manually that PayPal button you saw in the corner that was exactly her sales machine so you would click that she would get an email and then it manually send you out the module after it was done so this is crazy nobody wants to deal with that I certainly didn't want to send out dozen modules a day like that so I need to add a shopping cart with automated downloads in addition to all of that there was the question of support so she was actually

[6:25] doing all of her support inside of WordPress posts and page comments so this was all over the site not centralized not searchable it was a nightmare on both sides so I had to put this into a support forum something that was much more sensible for the customers to get a better experience so this is what it ended up looking like about six months later and once I had had all of this stuff in place that looked more professional customers more excited about it it was actually easier to navigate they were just getting a better experience and they were getting what they needed out of the plugin so

[6:57] that was great you see over here on the left this is when I first bought the plugin that was about $600 a month in June of 2010 so by the time I got over here to December of 2011 I was making about $2,000 a month on the plugin however I also noticed at this time that my original three areas of focus had actually ballooned into four so now I was spending a huge amount of time on customer support which as I'll tell you a little bit later turns out to be a very key thing about WordPress plugins but in this particular case here because I was spending so much time on support I

[7:30] really couldn't spend time on product development I couldn't do both of them effectively so by focusing on support I really had to hire an outsourced developer and that's when it actually taught me a lot about what you do and don't do with an outsourced developer these particular months right here are the months that my developer was actually not responding to my emails not dealing with customer bugs my customers were getting mad I was having to give refunds and I didn't really have the gall to fire him at that point and I really should have so eventually I got smarter about it and finally kicked him out the door and in November of 2011 I

[8:06] hired another guy that I still have working for me today and things started firing in all cylinders so in January of 2012 I actually got another opportunity the original author of the plugin contacted me and she said hey you know what I've got this other plugin and you know I've got this WordPress theme business and I got this plug-in and the plugins not doing so well and I really want to focus on the themes it's called business directory are you interested and I said well let me see it so it turned out that everything that was going on in business directory were the same problems I had already solved in a

[8:38] WP CP so I said to her sure absolutely I'll take it how much do you want for it $1400 so I bought it that day after I bought business directory you can see the white line there and after December of eleven that was the first month of revenue I got there was about $150 a month so nine months after I acquired that and did everything - business directory that I did - aw PCP I saw the revenue actually surpass aw PCP and be thirty times what it was when I actually bought it so I could give you some takeaways about buying websites but when I get into the conversation about

[9:19] the plugins and the websites people tend to be interested in the plug-in business asked aspect of it so instead I'm going to talk about some takeaways from running a wordpress plugin here today that you might be interested in the first one is support is absolutely everything for a wordpress plugin if you want to have a successful WordPress plug-in business you've got to have super awesome support that's been my experience the everything that's in the repository is like 99% of them are poorly supported and poorly documented so all you really have to do is not trip over the bar to look like a complete hero that also had the effect in my case

[9:52] of in addition to just giving the customers a good experience and be more successful they also turned around and started rating the plugin much higher I also had a problem where the ratings were very poor because they weren't getting the support so if you fix this the support suddenly they give you better ratings which by the way also turned around into more revenue there's a certain member of the audience who shall remain nameless patty 11 that has said for the past four years consistently thank you for mentioning that earlier Patrick because now I didn't have to memorize something else with the talk to raise your prices I

[10:28] have four years of evidence to say he is 100% correct on this so when I originally acquired the plugin the author had prices that were all over the board she had about seven modules and every single one of them cost something different $19.99 $25.99 $39.99 whatever so it's very confusing to customers so the first thing I did was just level that out and the second thing I did was raise all of those prices up so in addition to the obvious increase in revenue that I got out of it also had a second effect and that was to actually get rid of my complaining high maintenance customers the ones that were

[11:03] really burdening me down in support so it definitely made a big difference to my business on both sides of that another thing that I discovered is that customers absolutely love bundling so I have in each of the plugins about 12 modules that I put together in an in as the sum of the individual prices and then discounted about 50% and customers buy these things like hotcakes so right now they account about 65% of my total revenue the but when I actually started offering the bundles I found that if I didn't put enough stuff into the bundles the customers weren't very interested in them so that magic number

[11:42] for me was somewhere between 3 and 12 I didn't actually pay attention to when it really sort of turned but it does actually matter you have to offer significant value in a bundle but if you do that the customers really like it wordpress.org is basically Google for WordPress plugins if you have a wordpress plug-in and you're not somehow in the free repository you're just missing out at a huge stream of customers so the good thing about wordpress.org is that if you just create a readme text which you're supposed to do is a plug-in anyway and that you can put your keywords in you will rank inside of the

[12:17] WordPress search engines for your plug-in on those keywords well that's a really easy thing to do because WordPress or it doesn't have any tricky algorithms you don't have to worry about backlink strategies no blood sacrifices to Matt Cutts and when you start to rank well in wordpress.org because wordpress.org is a trusted domain you also rank well in Google so you get Google for free just by optimizing your wordpress.org which is nice lastly the the thing that I've ran into and didn't really expect to was that I ran afoul of the WordPress Terms of Service except that this was something that the original author had just failed to

[12:54] secure permissions for things in the plug-in and I didn't know about that so unfortunately somebody decided to report me one of the customers who was mad at me during those two months and they kicked me out of the repository for a week so I was really stressed out about that and it took a very set of tense conversations back and forth to actually get back into the repository and promises and so on and so forth so if you're going to put a wordpress plugin in you have to make sure that you're free and commercial aspects very clearly delineated and you've secured all the right permissions because they are extremely serious about

[13:26] that no joke so the question you might be asking yourself at this point is is this something that I can actually do or are you just incredibly lucky in this just sort of fell into your lap the answer is yes you can do this I have found other businesses not just these on Flippa and I have purchased them and they still are running today so you know you want to start out you want to find something that interests you now for my case what interested me was running a business so the fact that it happened to be WordPress classifieds didn't really matter so much to me but

[14:00] that you know your situation might be different once you do actually find it then you want to stay within a particular budget to buy this thing right here I would definitely not recommend you know getting a loan or a second mortgage or anything like that there's definitely inherent risk involved in this and nothing is really certain you can actually have things changed really radically like when Google Panda and Penguin came out a couple of the sites that I bought just cratered so you know it was lost money things like that can happen so you have to be careful you're going to want to obviously improve the experience of the

[14:34] site there now there's lots of stuff that we're learning here at micro comp that's going to help with that but even if you're completely out of ideas if you were to go to some of the sites that are going to be mentioned a lot here at micro comp you know places like bid sketch or hit tail or drip or authority or plan scope you know if you just look at those websites and say okay here's one aspect of their you know customer onboarding or their support or their sales page or whatever that I really like and you put that on your own site you're going to end up doing fairly well

[15:04] just by borrowing from sites that are doing it well now and last thing you want to make sure that you get feedback from this from your customers because honestly theirs is the only opinion that actually matters anybody else that's not a customer it's it doesn't mean much for them to tell you that your site is good or bad so make sure you get feedback from the right people so thank you very much for the time here today again I left out a lot of details so if you want to go deeper into this just hit me up during happy hour I'll be happy to talk you

[15:31] [Applause] [Music]

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