Ep 31 Mohit Tater from blackbookinvestments.com
In 2011 Mohit started working for a startup whilst building websites part-time. He left the startup job after a year and came across Flippa in Dec 2012 where multiples at that time were 6x-12x monthly profit!
He found a services website offering social media marketing services and thought it was a good fit to get into the game, purchasing for $2500. He ran it for 6 months where he made his initial investment back and then he flipped for $12k.
Then he moved up to low five figures and current strategy is to buy and hold. He connected with Ryan from Digital Acquisitions and Ryan Sorensen who is now at Acquisition Station and started working with brokers. Then moved up to mid five figure deals, $20k-$100k is the sweet spot he likes to play. He has a team member looking at listings on Flippa every day but it’s hard to find good listings there now.
A great strategy is to follow listings you are interested in, build rapport and vet the seller by asking questions and then reach out if it doesn’t sell to try and get a great deal.
Mohit does his own outreach to generate dealflow for content sites looking mainly for advertising sites rather than affiliate sites. He would rather build than buy affiliate sites as thinks that affiliate are overpriced.
He has 2-3 sites in the pipeline that he is building right now and typically sells every other site, holding the rest in a portfolio. Mohit believes more in the cashflow but that it’s better to have big exits once in a while.
Mohit will launch with a substantial amount of content, typically 50-80 pages with an investment of $4-5k. He looks for existing, brandable authority domain that has good backlink profile and he keeps up to $2k to invest in a domain before starting.
He mostly goes through auctions or expiredomains.net as it’s hard to find dropped domains now that are a good quality. He doesn’t notice much of a difference between building on a good expired domain vs an expiring domain still indexed.
He views content as his forte, rather than SEO or linkbuilding, so to build out on an existing authority domain is the way to go.
Mohit does not spend money in links, he gets link opportunities in his inbox every day from people asking to write guest posts on his sites, of which he has a portfolio of over 40, and it’s a very good opportunity to do a link swap by him asking do they have any other sites (so it’s not reciprocal link) where he can then write a guest posting (rather than a link insertion) linking back to his own site (like a triangle).
It means he does not have to go out for links, they are coming to him.
He’s been buying websites for almost 10 years now and in 2014 he started being approached by people asking to invest in websites and needing help. He does a 1-2-1 work (rather than a fund), with a minimum he needs them to invest for his own ROI. It’s not his primary focus, he only works with people he knows or references from people he knows.
His focus is 40% on https://blackbookinvestments.com/how-it-works/ with investor money, 40% on building new sites from scratch and 20% on his portfolio (which is automated now by his team). On that page there is an investor questionnaire, if investors have a minimum of $50k USD he will then look to purchases a website for them.
Mohit charges a 10% finders fee paid upfront for working with investors looking for content sites only and tries to put people off as this is not his bread and butter. It’s a process that typically takes anywhere from 2 weeks to 4 months as he is very picky and choosy about the websites that he buys.
Where Mohit brings value is in negotiation – he tries to save them more money than charging. Once the deal is done, his team deals with migration. It’s 100% passive for the investor however the buyer wires the money directly to the seller using escrow or via a broker. Mohit and his team run all of the websites for his investors as the operator from a 50-50 cashflow split from day 1. Sales proceeds is a 50-50 upside split. They collect the payments into their paypal and then pay out the half to the investor every month (if the other way round he would have to be bugging his investors every month for the data). He sends a report to investors on the first of every month saying what the site did the last month. There is no minimum lock-in for investors but Mohit says it would be a good idea to commit to one year at least.
In terms of ad networks, Mohit prefers https://www.media.net/ as well as selling some banner ads themselves.
If any of his existing investors wants to sell a website he will purchase himself within his own LLC and then sell from that LLC to a new investor.
I really like what Mohit is doing – on one hand he has an investment company with http://blackbookinvestments.com as well as a publishing company with his own portfolio of 40 sites. I discussed something similar on episode 29 with Greg from Empire Flippers in terms of viewing what we do as media companies. It really is hard to describe what we do in this website business!