I've only had it a month, i spent about £6k to buy it, i spent a further £2k buying a van and other one off supplies and my monthly profit after staff wages and other recourring expenses is around £800 a month. So if i left it at that i'd see a 100% ROI in 10 months.
However I intend to spend around £10k on advertising and marketing in the next 3-4 months to expand the business, i expect a conservative £25k a year revenue for that £10k.
Of course being a geek has helped immensely, especially with automating things like invoicing, payments, accounting and building the website, phone system, business cards, designs etc.
I urge all geeks here to think about applying your high tech skills to low tech businesses, you'll often find massive opportunity, especially if the space is typically occupied by non-tech literate people.
Also, as a side note, this is now my new strategy for my consulting too, instead of being a PHP Developer doing boring but well paid jobs like facebook apps and wordpress sites, i'm now positioning myself to be a business consultant that makes businesses money by applying technology where its severely lacking, and i already have my first client, a taxi company.
If anyone wants to ask me questions, feel free to reply here if you dont mind if being public or email me: contact@[myHNusername].com
Making large amount of money in short periods of time through investing necessitates either making a very active, labor-intensive investment (like buying a small company or flipping houses), or resorting to speculation. Obviously, this is not passive.
The market is self-correcting. It's absurd to believe that one can earn prodigious amounts of money quickly, predictably, and effortlessly.
However, you should take this with a huge grain of salt. I am not an experienced investor. (In fact, I'm fairly sure that the law prohibits someone my age from investing. Even if it didn't, I wouldn't be in a financial position to invest anyway.)
Just like banks and other players (ahem rating agencies) before the financial crisis assumed ABS were safe because they were diversified ("the housing market cannot collapse uniformly accros the country"), they can actually become very correlated in a very short amount of time.
So even though peer-to-peer lending is an interesting proposition, it is important to understand that it can potentially become ugly and sticky...
My #1 question, however, is what makes people turn to a source like this?
Peer to peer lending being somewhat new, I would say some of the borrowers think it's cool. Some of them might also be making a principled choice ("banks are evil").
But ultimately, if you have a reasonnably good credit profile it should be noticeably cheaper than the average traditional lender with its branch network etc.
The only bad thing about these sites is that your income counts as normal income and not capital gains.
As much as I hate to admit this, I am a much better trader than an entrepreneur.
Basically, I refuse all conventional stock investing advice. I never diversify; at most my portfolio has two positions at a time. And I invest upwards of 90% of my cash on most trades. I do not trade on margin (well, technically I do because I don't wait for trades to clear before taking my next position)--but I don't buy stock than cash I have in the account. I only buy heavily traded equities; trading volume over a million shares and over a billion dollar market cap. And I focus on stocks with more or less sound fundamentals that are showing recent swings in price. Apple is a good example.
But as for a being highly methodical and data driven--I'm not. I have a few simple rules and am patient. I generally exit positions after 1-3%. And then I have a few that I let ride. It doesn't take much to hit 40% that way.
I spend less than an hour a week doing research and monitoring my position. I don't have any magic edge. But I'm making money, so continue chug along. A bull market definitely helps, but I've also done ok in a bear.
My strategy is simple: I look at the day's biggest losers and, if my research says it's an overreaction/emotional, I'll buy in the hopes of selling in the next week. Most of the trading comes around earnings time. I had a pretty good return with Groupon (I sold too early though), Verisign, MMR and a few others.
I found I was spending too much time checking the screen when I should have been working though, so I just bought about 100 shares of Apple when they dipped below $520/share recently and hope to sell early next year when they get back up to $625 or so, hopefully after Q1 earnings.
By the way, this isn't a passive strategy for me. I use stop and limit orders, but it takes a lot of time to keep track (at least for me, but I'm not very efficient), which gets especially difficult when I'm traveling and the market stateside doesn't open until 7pm (bleh).
Do you monitor daily, > daily, and/or use any automated tools to stop out of or otherwise monitor your trades?
It seems like you could make consistent small wins here but would also be subject to occasional big losses.
It depends on the trade. If I have time to get a better feel of the way the stock has been moving, I'll trade volatility. That's when I'm setting lots of limit orders in a short period of time, which is uncommon for me. If I knew how to trade programmatically, I'd be doing a lot more of this. It's something I should learn this year. But most of my trading is based on what I feel are fundamental flaws I pricing.
I make it a point not to actively monitor. I have Google Finance up all day, but I'm not glued to it. I just set a limit order to close my position as soon as I get into it. No real automated trading tools and don't stop out (which is really bad practice I should change). I've looked at autotrading via subscriptions, but since I'm booming gains as high as these pros, I see no point to encumber myself with complexity. For now, I'm a profitable simpleton. Of course, I fully understand my days are numbered. I'd much rather I didn't trade, but I can't any other activity with this kind if return in time invested.
You're right--I should be coming against a big loss. Actually, I have seen big losses, but I just never realized them. That's what I mean by being patient. I just wait it out until the company turns around.
The sites I use for insight are: Google Finance and Trefis. And I see what is going on in the order book--I use Interactive Brokers, which offers access to almost tick by tick trading.
We bought in when the housing market was at its low. The credit markets were crap so we had to buy all of them cash except the one we live in now which was a bit more expensive. After expenses (HOA and property management) our average returns are about $900/mo. ($10,800/yr.) for every $100,000 invested. That's not too bad considering housing prices and rental rates will continue to climb over time (or that's the plan at least). We're fortunate enough to live frugally and just happened to have the money lying around when the housing market sucked so we bought a couple homes a year over the past few years.
For the house in South Carolina we're losing about $200/mo., but it's a 15yr mortgage. We'd be making a bit if it were a 30yr. I bought that one when I saw 21 so I didn't know anything about anything. Some would say I still don't.
The real estate is nice because the extent of my involvement is manually paying real estate taxes on the homes without mortgages, answering a couple emails a year about high dollar ($200+) repairs or signing new lease agreements.
As one of the other posters mentioned, we also invest in Lending Club. Our investment was more just play money to see how things worked, but returns so far have been surprisingly good, around 14% annually. I like it because it's so diversified with only $25/loan. You can maximize returns by picking better loans.
The passive income is nice because it'll allow me to quit my job next year and work on my startup full-time. I want to apply to Y Combinator and even if I don't get accepted I'd be able to bootstrap my startup indefinitely with our passive income. Hopefully it doesn't come to that, but if it does maybe I'll pivot around year 25 (year 50 at the latest).
edit: If you're in Canada, you can use ScotiaMocatta (division of ScotiaBank) as your broker Buy. online and they will deliver the metal right to your doorstep, or keep it with them in a safety box.
I'd say about 15 to 20 hours a week for the first 9 months, then declining to about half that after 18 months.
I run 2 Google Adsense ads on individual post pages and it more than pays for the cost of my shared hosting account. I haven't blogged in over a year after a pretty good run.
I also run http://dummyimage.com with a single ad which covers the increased monthly VPS cost to keep it running.
Maybe the original poster should clarify more what they're after, - i.e. something that returns dividends/returns of some sort other, or just a capital gain at the end of the tunnel, or both, etc... would enable the community to provide more focused answers.
I believe there are lots of ways to generate returns on assets in compounding ways, and I'm interested in ways people in the HN community are using their skills, knowledge, and analytical brains to do this.
I'm not so interested in pure speculation per se -- in fact, one of my reasons for looking for alternatives to the stock market is that many stocks themselves meet the characteristics of speculation to me. (Just because you wrap it in quantitative comparisons to related-industry multiples and so on doesn't mean the whole market isn't overvalued.)
Thus precious metals, bitcoins, etc. aren't very interesting to me either, though they're interesting enough suggestions (as alternatives to leaving assets in dollars, if nothing else) for the purposes of this discussion.
That all said, I'm willing to take lots of risk in small doses, if the return dynamics are there.
Angel investing meets a lot of the criteria for me (and I've done some), but I don't have enough capital to make many bets of typical angel investment size, ie to have a sufficiently diversified portfolio to get EV returns.
It's like buying a bunch of some cheap useless company stock, telling everyone to buy them, then you sell when the price goes up.
If you don't expect something to become more valuable, investing in it is a stupid idea, no?
This is the kind of implication I was shooting for: http://en.wikipedia.org/wiki/Expected_value
Is there something I'm missing about this?
Domain investments are a proper alternative asset class and many people (some of whom have gone to the best schools in the world) are active players.
I didn't say that domains aren't an asset; that has little to do with what I was talking about. I'm not saying they're not a good investment, I'm just saying my impression is that they're a kind of investment which does nothing to further society, like other sorts of investments do.
So rather than post an emotional response, why not engage that no doubt massive neocortex of yours and investigate. I give it to you to decide. And of course I'm being snarky here, it's a shortcoming of mine ;)
On a different note, this firm has good research on the matter http://www.fairwindspartners.com/Why-It-Matters/FAQs/ (NB: I'm not affiliated in any way)
I started by stating that my opinion was an "impression". Obviously by using the word "impression," which by definition means "an opinion (esp.) formed on the basis of little evidence," I was allowing that my opinion was influenced by external and implicit sources. I then asked for more informed input on the possibility that I was lacking an understanding of the issue.
Your response started with "this couldn't be further from the truth," from which I assumed you would go on to challenge the content of what I had said. Instead of countering what I said, or even providing input (which I would value, since you present that you know about this subject) you resorted to challenging the source of my opinion...the very opinion I'm trying to become more informed about. This is a red herring, and I tried to say as much. If you considered my response "emotional" then I'm sorry, but you misread my tone.
But all that said, I have given this independent thought and have come to the same conclusion: that by all I've come to understand about domain sitting, the act of buying domains that you don't wish to develop in order to sell them at outrageous markup later does not provide value to society, and in fact has negative value as it raises the cost of doing business without compensating by contributing value elsewhere.
Perhaps you misunderstand what I mean by domain-name sitting, which would seem to be true given the completely irrelevant link you provided above. The Fairwinds Partners' FAQ talks about having a cohesive domain-name strategy as part of a greater branding and trademark initiative. I fail to see its relevance to domain-name sitting.
First of all friend (may I call you that?), please chilax. No need to be flabbergasted.
A couple of points I'd like to make. To begin with, in my belief system, as the owner of an asset, you (me or WHOMEVER), has the right to do with that asset whatever you wish.
If you buy something - for whatever intention - I have no right to project my beliefs about what is or isn't appropriate use for YOUR PRIVATE PROPERTY.
As an example, if you were to buy a plot of land (whatever your intention), does someone have the right to say, "you're not adding value to society" because you don't develop it?
I'm a firm believer that if a person doesn't know or appreciate the value of something, they are not the best owner of it.
But that's another issue.
Imagine this. You and I both have an equal amount of free time per week - say 20 extra hours to do what we so desire.
I decide to play online scrabble, write random HN posts and yell at the screen when people get answers wrong on Jeopardy.
You on the other hand, decide to use your time doing other things. You spend hours:
-reading through scientific journals (a good source of emerging technologies and future generic domain names that will be popular)
-analyzing data from keyword research tools
-charting data you found on DNSalesPrice.com
After putting in the work, you find and invest in a small portfolio of domain names.
Now, one day I read The Lean Startup and decide I want to have a go at this thing called a "start up".
Doing whatever research I so decide, I think up a domain name.
Now, it turns out that the domain name has been registered.
By none other than you.
So, I send an email and ask you to quote me a price.
When I get an email from you quoting a price that's in my mind at an "outrageous markup" - I start blasting you on forums.
Forget the fact that:
a) neither of us had some kind of unfair advantage.
You decided to put in the work it takes to find and acquire these assets - I on the other hand decided to enjoy my leisure time
b) Another party comes along who sees the value in your "outrageous markup" and happily pays you. Not only that, they turn the investment they made into the asset they bought from you into a 25+% ROI (or more....far better than the stock market, wouldn't you agree?)
c) They also substantially lower their customer acquisition costs via their media buys with the right strategic domain investment (content on this relationship here - http://www.ozdomainer.com/domain-names-podcast-episode-19-wi... 15:30 difference between good domain and a bad one is [approx] 4 to 1)
One could go on, but I'll stop here.
I find it shocking when people blame other people for "extortion" for making smart business decisions that, had they had either the foresight or the work ethic, they could also have done.
It's one thing if one fraudulently stole someone's domain then demanded they pay you for its return. Bu when one party takes on the inherent risk involved in ANY kind of investment - then have others lambast them for doing so?
That I can't understand. Having said that, I'll end with a favorite quote of mine (paraphrased Emerson) - "I may not agree with what you say, but I shall defend to the death your right to say it".
Renting quality generics is a good way to go these days as well. Frank Schilling's portfolio collectively pulls more traffic per month than Twitter but he's still managed to largely stay under the radar screen....
How often do you make a sale?
What kind of process do you use for the exchange? Do you have some kind of escrow, and if so who do you use for that?
This being said, investing in real estate is the only way for a regular person to achieve a high leverage ratio, which is probably why people see it as such a good investment.