Interview with Dom Wells, founder of Onfolio
In this episode of the Mad Profit Podcast, we speak to Dom Wells, founder of Onfolio.
Dom became a self-taught expert at SEO and content site management over years of trial and error and then started (and sold) Human Proof Design, a company that builds profitable content sites. His latest venture, Onfolio, manages content sites for investors around the world.
In episode 11, we speak to Dom about his journey and he helps us understand what to look for when buying a content site, some industry trends and how to be successful in the space.
| INTRO: Welcome to the Mad Profit Podcast, where we interview active investors, entrepreneurs and experts, who left corporate jobs to buy or start successful ventures and live life on their own terms. |
Listen to their stories learn from their experiences and heed their advice, so you too can create mad profits and the life you’ve always wanted. And now here’s your host Laurent Truc.
LAURENT TRUC: Welcome to the mad profit podcast. This is Laurent truc your host and today I have a very special guest with me Dom wells from Onfolio. Dom how are you today?
DOM WELLS: Yeah, I’m good thanks.
LAURENT TRUC: Excellent! I’ve been very much looking forward to having this session. You and I are on a deal together, you’ve been in the internet space for a very long time. A lot of our listeners are either corporate people or people that are getting into the internet space, so really interested in your knowledge and some of the experiences that you’ve had. So very much looking forward to having this conversation, maybe you can start with a liberty background, love to hear where you started from and kind of how you got to where you are today. If you don’t mind giving us some background.
DOM WELLS: Yeah sure it’s a seven-year story. so you know I just do the abridged version but, I first got into the space in 2012. I wanted to make some more money and I was living in Taiwan. So my options in Taiwan were basically teach English, which was a decent job, I had been doing that for four years already, but it has a load ceiling like you know you can make a comfortable salary but, there’s no real way to go higher and without being fluent in Mandarin or having very specific qualifications there are many other options for you. So online was kind of the only option for me and so I found affiliate marketing, just through various just trial and error and lots of research.
So, I just started building sites, learning what I could and just learning how to rank websites in Google, how to get traffic to them, how to then monetize that traffic and yeah like it took me a while, I think after a year and a half, I was just about making a thousand dollars a month online. Yeah, I mean it’s weird, because at the time obviously a year and a half I thought this is taking forever. I’m never actually gonna be able to do it but, when I look back I think a year and a half was quite short. So, I guess perspective is very important. Then I did start getting a bit of success and right around the end of my second year or maybe a little bit earlier I started a company called human proof designs, and the opportunity I had seen was that, I noticed people were buying websites off flipper, which I don’t know if you’ve covered on the marketplace with flippers, sorry on the podcast, but flipped as a marketplace for buying and selling websites.
I guess it’s a bit like eBay, but for websites. And I noticed that people were buying a lot of junk websites, like websites where they were basically these turnkey cookie cutter websites and the seller was just kind of saying; hey! you buy this website $500, $300 it’s gonna make you money on autopilot overnight, no effort necessary and so someone like me who knew a little bit about online business by then. it was an obvious lie, but people were buying them and I was like well there’s clearly a market for these turnkey starter websites. So what if I just did like legit ones where they were unique websites and I said you have to follow this game plan and work hard and, but you this is a business in a box and you can grow it and build a business and make money online like I do. And it kind of flopped, because people were like no we’re gonna go with the guy who’s promising us he gives you money instead.
So, I ended up having to stop selling on flipper and I built the human clear designs into a big brand with the content marketing and going on podcasts and just basically what businesses do to get noticed and eventually probably after a year we grew quite well. People started realizing that what we were offering was really cool. They knew that we were legit and we offered good training and so we then rolled out additional services like SEO services and content services and basically everything someone needed after they bought this business, we could help them. So, it’s like, here’s a website you can go off and take this and do your own thing or you can pay us more and we’ll help you with more and I grew that to the final seniors.
We did a million dollars in revenue each year and then I sold huge designs in April 2019, So just coming up for a year ago depending when someone’s listening to this, because I wanted to move into Onfolio. So that’s kind of what I’m doing there.
LAURENT TRUC: Oh! that’s a great journey. So, you made a comment that people had decided at first not to jump on to your micro sites that you were making and stick with the ones on flip, because of the promises. So, you were obviously a lot more honest about the potential of these sites and the work behind it, is that what kind of threw people off?
DOM WELLS: Yeah, I mean it might be that I was very good, but I would be like I you know I was making like $2,000 a month or $1,000 a month with the time, with some of my sites. So, I was like hey! buy this site, add some more content to it, do some SEO and in a year, you might be making $1,000 from it and the site was only for sale for like 200 bucks.
So, yeah, I thought that’s a pretty good offer. I mean some people bought it, but others were like it was weird some people would be like you want me to pay $200 for something that’s not even making money and I’d be like yeah like you could pay a thousand dollars for the iPhone, but then meanwhile these like basically stamp sites we’re selling like hotcakes. So, I realized I needed to explain to people why we’re really what my offer was, so that I understood.
So, I started content marketing and blogging and human put designs and I just stopped wasting my time at flipper, like I think flipper has a place, but not for what I was offering and ironically the new owner of human poop designs is now partnered with flipper and they sell human proof designs, turnkey sites on flipper, as like an affiliated partner. So, it’s kind of gone also yeah so, it’s kind of cool, but also I was like oh it’s funny how it comes together.
Yeah so, I just started blogging and I was more doing – here’s how you make money from an affiliate site or here’s how you can improve your conversions or here’s how you should structure an affiliate site. And then I would do like guest posts on someone else’s blog on a similar subject and then you know it’s basically like here’s how you do it. I’ll outline all the steps or if you want just pay me some money on my team or build the site for you and then people. You know then I started attracting the right people, but also people understood the value and the offer a lot more and ultimately we built our own audience and we could put our prices up later and you know we just kind of created some blue ocean, before I knew what blue oceans were.
I also found just before you sold it, I was looking at some of the sites that you were selling and I think your team got really good at figuring out keyword research and determining what is the potential of some of the sites that you had built. Right so instead of $2000 a month like many of them were at the five, six thousand dollars a month initial, which was a nice return, because a lot of these were you know I mean I think some of the ones you sold had about six months of activity before you would sell them. so, people were not coming in having to build that first six months with Google reputation, like they were ready of a certain size and so you were selling him for what? A thousand to fifteen hundred dollars with a $5,000 a month potential. It was actually a really nice return for people.
Yeah, I mean I was kind of wary at first of listing the potential, because it’s you know you need to be clear that it’s potential, it’s like you’re giving this site which is started making inroads into this niche. It’s got ten articles, if you expand it to a hundred articles and you do the SEO and the marketing, the potential of this niche is large and the reason we ended up doing it was so that people could see the potential, but also so that people could compare, because when I first listed sites people would be like well I don’t know if I want the dog site or if I want the sewing site and I say well which one do you prefer and they say well whichever one’s got more potential.
So, I started showing well this one’s got more potential, and then you know of course everyone just went for the one with the most potential and then we were pretty good at explaining that, it’s like we’re not guaranteeing this is going to happen, like we rarely had anyone say you said this has made $10,000 yeah and it doesn’t, because we owned the messaging .So, people understood what we were and what we were saying.
LAURENT TRUC: Well, there’s so many factors to between you know the quality of the content you’re putting up, the amount of money you’re investing in Google algorithm changes. so, no matter what promises you could have made, most of that was not in your control anyway.
DOM WELLS: Yeah and at the end of the day if you don’t do the work, then you’re gonna see the results.
LAURENT TRUC: So, then you you sold human proof designs and then you went on to onfolio. So, had you had the vision of onfolio before you sold human proof design and it was about getting out of human proof design, because that’s what you wanted to invest your time into?
DOM WELLS: Yeah, I mean I already started onfolio, part of that was because it’s a lot easier to sell equipment, put designs and transition into onfolio if it’s already there. It’s a lot harder to say to a buyer, hey! I want to start this other thing, but don’t worry they’re unrelated, but they kind of related.
So, it’s a lot easier to have it and say well this one already exists and so there’s this one, but I’m leaving this one and you know we’ll make sure to define boundaries and so on. But also I wanted to validate the idea from folio and I wasn’t a %100 sure like should I run them as separate brands or should I leave one and focus on the other?
So, I started on folio was like well let’s see what happens, validate the brand and then I realized on folio. I don’t know if it had more potential than giving proof designs, but it was more aligned with what I wanted to do. It was what I was more interested in, so I felt like I’m kind of gonna dislike neglect human proof designs if I stay.
So, if I leave, human proof designs can grow I’d also want folio can grow, because I’m not being pulled in too many directions and yeah both brands have grown since it happened. so, like it was a good decision. So, what is on folio? can you give a bit of a detail in terms of the kind of the idea and what it is and if the idea has come to fruition.
Yeah well, yeah I mean we’ve evolved a lot over the last eighteen months, but so the original idea was twofold one was people who already have a website, but don’t want to run them anymore, we will run for them and I thought that idea was gonna be more popular, but it’s actually less popular and we don’t like it as much so we kind of less excited about that. Whereas, the other idea is basically people have money they want to buy a website, like an established website, maybe a website making a grand a month or more, but they don’t want to lose their shirt.
Yeah they don’t want to lose their money, so they’ll say to us, can you help me buy one and then run it for me? So, that’s what we do, we basically… so we don’t like take the investors money and go spend it. It’s more like we’re kind of like consultants or partners, so we say hey that website looks really good, if it’s your budget here’s why we like it, here’s what we don’t like or what’s kind of a risk and if you’re okay with that risk you know let’s buy it.
If you’re not okay what could we do to mitigate it? or should we just look at a different one and then yeah we kind of walked them through the process. We helped them buy it and then we run it for them afterwards. So, essentially we’re kind of like property managers in real estate that kind of I guess we’re also like the asset managers as well, because we’re you know both stages and I wasn’t sure how popular that was going to be. I wasn’t sure if people would trust us or if there was enough demand. turns out as way more than I thought.
Yeah that’s been really really good. Yeah so, at the beginning of 2019 we said our minimum was $30,000 my purchase price, because anything lower than that there’s not really enough for us to charge a fee and the investor to get cash flow and returns, but then after a few months we were like okay fifty thousands on minimum and now seventy-five thousand dollars like minimum and even seventy five thousand dollars is a little bit small for us to be honest. so, yeah there’s a lot of money looking to pour into the space and it’s looking for people like Onfolio. So, we’re in a fortunate position to kind of you know be able to do that service like very well, just responding to a lot of demand.
LAURENT TRUC: Yeah that’s great! So, how many sites do you have under management?
DOM WELLS: Now about 35.
LAURENT TRUC: Wow!
DOM WELLS: Yeah, with aforementioned partners.
LAURENT TRUC: And that’s within you said you started it less than two years ago?
DOM WELLS: Yeah I registered the domain November 2018. so, now it’s January 2020, so what’s that? that’s like 14 months or 15 months.
LAURENT TRUC: So, what do you look for when you’re gonna buy a site for someone else or with someone else? First of all is it all about the site or is the individuals passion or like personal taste. Does that matter? At the end of the day you guys are running it, they seem like they’re silent partners. So, is that part of the equation?
DOM WELLS: It matters to some people, because some people want to be a little bit more involved in terms of like strategy or something like that or even might even be a strategic acquisition, like some people have other websites in a certain vertical and they want to have add-ons. The vast majority of people are what I call niche agnostic.
So, they’re really just interested in the opportunity, yeah so most of the time it’s just the right site for the right price and where we sometimes disagree on is what the right price is, but again that’s the value I add, as I can tell if something is a good value or if it’s expensive or if it’s cheap and it’s not always based on the multiple. The multiple is actually pretty relative. So, yeah, I mean what I look for? so just to be specific we only focus on content websites.
So, ecommerce FBA, that’s not somewhere we look. so, there would be a different criterion for people who want to buy any e-commerce business, but for a Content website we look for… I do it in two stages; The first stage is don’t lose your money and the second stage is grow your money. Because content websites are sold at a multiple where even if you don’t grow it you can still achieve a 40% ROI, you know obviously it’s less if you’re paying me fees, but that’s kind of like how the numbers work out, if someone bought it and operated it by themselves. Now obviously you want to grow it, but if you don’t grow it and you get 40 percent, that’s not something to be upset about. whereas, if you if you go for one because you see this amazing growth opportunity, but in the process you overlook a red flag and you get zero percent ROI, you know that’s kind of what I’m trying to avoid. so, it’s like Warren Buffett’s number one rule is don’t lose money, number two rule is don’t forget rule number one.
So, when I look at a website, I’m looking for will this deal make sens if I don’t grow it. so, am I paying too much? Will the website be around in a year and you can never know for sure, but there’s definitely some things that can help increase the chances of that. How have they done any kind of dodgy backlink building? How long has the website been around? Has it been successful for a month or successful for a year or more? What is the niche, is it is it fidget spinners? Probably not the best long-term niche or as Pokemon go, you know a crypto, maybe these ones are not going to be around or at least they might not earn the same as they were before. so, I look at things like that. How’s the website? Just had like, it’s just gone on a tear recently and it’s made a bunch of money, which is unsustainable.
Yeah so, I look at all of those things and then once I’m done looking at those things, then I look at the opportunities. so, how much space is there to grow in the niche? How much space is there to grow in terms of their traffic and then also making more money from the existing traffic? so, cruise I’ve got a lot of websites, they ranked maybe number one for a keyword, like best..
I don’t know best sterilizer, you can tell I recently had a baby. Due to sitting right next to sterilizer like that’ll do. And maybe they ranked number one and they’ve got an article, but the articles you want like one Amazon affiliate link or it doesn’t have a comparison table and these are all things where you can see. Oh! If I buy this site and add those things in, I can probably make a revenue increase right off the bat. So, if I see stuff like that that’s great, because like I said the first thing you want to make sure is that you’re not going to lose your money, but if it’s two websites you’re not going to lose money.
Obviously you want to go for the one that has more upside. so, that’s kind of basic, so what I am less interested in is kind of like, I don’t know, I don’t really know how to describe it. I guess it’s like uncertain upside or assumed upside. So, there’s definitely a lot of people who come up with creative ways to fail to make money. So, you know you look at a website and you think oh the email list hasn’t been touched for two years.
I can totally make money by just sending emails and when in reality you’ve just got an email list of people that are never going to open an email from you know or they say this websites homepage is terrible. If I make him look pretty it will make so much more money and it’s like yeah you should make it look prettier, but you don’t you can’t you don’t know for sure if it’s going to make you any more money. so, these are all things where it’s like yeah you could do that, but that’s not the reason you should buy the website. You should buy it, because of stuff that you know, so it’s like okay I’m gonna look at everything I know, I know I can add tables and tables. 90% of the time increased revenue I know the website is stable and you look all of those things and if it still makes sense to buy it, even if it means buy a little bit more expensive than another website. that’s the….
LAURENT TRUC: Got it! Do you buy with a certain time horizon in mind? I mean some industries seem to move very quickly or you quasi flipping that in two years, you’re planning on getting rid of it or do you try to buy and hold?
DOM WELLS: Really depends on the investor. Okay yeah a lot of people are kind of keen on the idea of like a quick flip. I’m less bullish on quick flips, because it going back to what I was just saying. It tends to lead you towards distressed websites, where you’re like this website’s been in free fall. I can get it for a discount and I can buy it and turn it around. It’s a fixer-upper and but it’s like yeah, but what if you do all that and it doesn’t pay off and you just start holding a kind of crap website. There’s a reason you know that someone’s selling that particular website.
Yeah so, of course, yeah if I could get two website in a short period of time, maybe I would just sell it. I think once you stop making improvements, the ROI actually reduces the longer you hold it for, but at the same time the cash flow is really good. so, we kind of go with what I think in private equity is known as flexible ownership. so, it’s like well we’re probably going to hold it for two years, we will reassess as we go. We may hold it longer, we may sell it earlier if we think there’s a reason and those reasons could be the niche is becoming less interesting.
You know like oh we’ve got this DVD player site, people are maybe players or you know or what else yeah, or you just think the website’s losing ground to its competitors or there’s another opportunity and you can take the money off the table and put the money into that website, or just maybe you think a recession is coming. it’s better to take money off the table now before that. so, there’s a few reasons why you might want to sell early or why you may want to keep going like maybe the site is still responding to your efforts and you think, well hold it another six months, I can sell it for double. so, yeah so, generally what we do is, we just give advice to our investors and say, here’s what we think, you know take from that…
LAURENT TRUC: Is there an opportunity now that you’ve grown your base of manage sites to 30 plus? Where you can use some of the assets from one for another, like if there’s a mailing list on one website in a specific niche and you just bought another one. Are you able to cross-sell and upsell and leverage that? It sounds like you’ve got a really interesting base of sites, now that you can play off each other.
DOM WELLS: Yeah, we haven’t done that a lot, but we are getting to that stage. so, there’s some other advantages as well, like there’s a couple of more boutique display, advertise companies, who they don’t take as big a cut as some of the more famous ones like, ads rival, media binding and they normally only work with publishers who say have a two million page views a month on their website and none of our websites have two million page views a month, but our portfolio has like five million page views in the article. so, they’re willing to make those kind of exceptions, so we can just get more privileged kind of deals like that and yeah there are some sites that are in similar niches and it’s always an interesting one, because I might say to an investor; hey!
This site is good, I think we should buy it, by the way one of our other investors has a similar site and then they might think woo! I don’t want to you know, I don’t want to compete with one of your other people and my argument is well someone owns that site. Anyway you know it kind of makes sense, it’s better if it’s like you know we’re all in the same team, rather than it’s just a person that you don’t know, but also the sites can then kind of Club together to negotiate better deals with vendors. oh! yeah they can cross the road by our email lists and sound. So yeah we haven’t done a lot of that, but we will.
LAURENT TRUC: Yeah oh cool, yeah alright, cool! so, Matthew so people who may want to get into this field, obviously working with you makes it easy, it’s okay you guide me, you take my money, you manage it. I’m great if somebody wants to kind of own their own site, where do you recommend in terms of resources like education, things like that for them to get more in tuned with this industry? Anybody you follow specifically that you were split in terms of quality of content and knowledge?
DOM WELLS: Yeah sure! It’s an interesting one, because a lot of the best training is not aimed at flipping or buying websites, is more aimed at building by bootstrapping and building sites from scratch, but if you went through those trainings you’re going to learn the kind of fundamentals that were still benefit you if you’re buying a site. So, the courses I generally recommend, of course human proof designs have got a bunch of resources and services for beginners.
Also, Authority hacker has some good courses and Matt tickety has affiliate lab which also has some great resources and we generally share a lot of those resources with our teams and it’s like rather than training ourselves, we’ll just say hey go take this training, but then in more in their website investing space, the quiet light brokerage podcast is very good, the Empire flippers long and they don’t really podcast anymore, but his story if you go back and listen to a lot of their historical episodes they’re very good.
Fe international, they don’t actually really have much content to be honest like their blogs, oh it’s okay that they just don’t blog a bunch and I recorded a podcast with them about four years ago and they never ended up publishing that podcast. Yeah, they recorded a bunch of episodes and then were like yeah, we should release this, but I was like well you know we recorded it three years ago.
So, yeah so they’re a good resource in the space, but I don’t know how much you can actually get from them, like because they don’t have much that’s digestible and there’s some people they want to go to flipper and buy our website for five thousand dollars and learn that way, and if like you know it crashes and burns five thousand dollars hurts, but it doesn’t bankrupt you. I would say that’s a good way to get you to dip your feet in, but it’s also like a five thousand dollar website isn’t going to necessarily teach you the same thing as a fifty thousand website, just because a five thousand dollars website really it’s just not got much going on.
So, it’ll teach you like how to work WordPress and stuff like that, but you can do that with a five hundred of the website. so, yeah I’m not sure if I would recommend that, but definitely browsing flipper and flipper do you have I think they’re working on their blog, right now they want to launch a lot more sort of world-class blog posts. so, maybe their blog will become a really good resource as well. so, yeah I think if someone jumped into all of those that I’ve mentioned that’s definitely gonna like level up their understanding.
LAURENT TRUC: Got it! Just some final thoughts. Where do you see the industry heading? I mean it’s gone so far from even the last three or four years, between the increase in multiples, the number of brokers in the industry, the popularity. Do you see a continued growth? Do you see it very much tied to the economy? Like give me your thoughts on where this thing is heading.
DOM WELLS: I think it depends on the tier. well, I say above a million dollars, I think more and more micro funds are like very small private coming lower and picking up assets that would not… you know normally a private equity doesn’t care about a million dollars business, maybe now they’re starting to look that way. $500 K to $1,000,000 space is always going to be a tough one. so, too small for some, too big for most, below like say a hundred thousand. I think it’s going to become more competitive, more difficult to get a good site just, because there’s so many people trying to buy one. You know I buy a lot of them and this is not enough, but I think the space is definitely becoming a lot more professional in terms of… so yeah just the work that all the good brokers have been doing is paying off and other the scams are gone.
People are feeling more comfortable with websites, I’m sure a lot of people listening to your podcast for example realizing websites are like an actual tangible asset class. You know I don’t think you’re ever going to get to a space where banks for example are going to loan money to buy a content website, just because I mean if it was personally guaranteed then yeah maybe, but it’s going to become more and more professional and you will see more and more sort of things that you see with other asset classes coming to fruition in terms of the economy.
Yeah, I mean the economy affects everything, so it’s going to affect this space. You know in some ways I can see arguments for it affecting it in different ways, like some people say multiples will go down because sellers might need to sell in a pinch and I’ll just take whatever they can get, but at the same time there’s going to be people with like eleven years of bull market stock gains that need to deploy the money somewhere else and several websites might appeal to them. so, that’s going to drive up demand. so, yeah I don’t know what will happened, I’m sure something will happen there.
LAURENT TRUC: Interesting. Oh very good this has been terrific. Any other thoughts or ideas for somebody who wants to get in the space kind of last minute? Here’s what I would do.
DOM WELLS: Well what I did was I learned by building from scratch and that made me very comfortable with websites as an asset class. so, as I became sort of rich, I guess and had more money to actually invest in, I started learning about investing and then put the two together and was like wow this is fantastic.
If someone wants to go that route, I don’t know if it’s the best route because it took me like two or three years of learning which I become really familiar with the asset class. so I would say that’s definitely not a bad route to go, if you want like a kind of a quicker version, probably buying smaller established websites will help you learn faster, you know like a three thousand dollar website where you don’t even care if you lose the money, you just came to learn something, like that would be good. And just following and following people like you and our blog and all the ones I mentioned. Really though it’s just a case of like getting your hands dirty, you’re not going to learn anything until you actually try and do it. so, that’s sort of tried and tested method in pretty much every industry.
LAURENT TRUC: so, perfect last question for you in terms of manpower to manage some of these sites. so, can you give us a gauge? so, on folio has 30-plus sites. Like how big of a team do you need to manage a handful of sites?
DOM WELLS: Not as big as you would think, but again like what takes me an hour a week might take someone else ten hours a week.
So, I can have a team of people that are very efficient and we get a lot of economies of scale. so, you know how my team operates, let us leave this conversation another time. I think for someone who’s thinking, oh I want to buy a couple of websites, build a portfolio and build my own team I think that’s probably more valuable answer. so, the average website let’s say 50,000 on the website publishes three or four articles a month and builds backlinks and those all the other stuff.
It really doesn’t need that much work, it needs maybe five to ten hours a week of my work. so, if you know what you’re doing and all else is equal and so you can run it with like two or three virtual assistants or like intern type time people or even you can outsource a lot of it to service providers, but that will cost more. So, depending on your profit margins and so on.
So, a small portfolio of like five sites could be run with a small nimble team. I think the hardest part for most people is knowing how to build that team and motive… the bit that’s hard is the strategy and so if you know the strategy and you know okay I need a keyword researcher, I need a writer and a uploader like someone who understands WordPress or you know HTML or whatever and I need an SEO and I know exactly what roles they’re gonna do, it doesn’t require a lot of manpower. If you don’t know any of those things that’s well that’s kind of the problem totally.
So, I don’t have another recommendation. You shouldn’t have. Because I mean we solved that problem, so there wasn’t a solution really before us. I don’t know what to recommend. Just try to learn all of those things that I said you need to learn.
LAURENT TRUC: Very good that’s perfect, that’s great advice. I appreciate it when we ended here. I’d love to have you on maybe down the road as onfolio continues to grow and as even the audience base here continues to grow and pick your brain a bit more. If you’re willing to do that that’d be terrific, but yeah um thank you so much for your time, I really appreciate it.
This was fantastic. Yeah thanks. Alright, enjoy the rest of your day. Take care.
OUTTRO: Thank you for joining us on this episode of the Mad Profit Podcast. We hope you enjoyed the show don’t forget to subscribe on iTunes Google Play or the listening platform of your choice also check us out at Madx capital.com for more useful information and resources to help you achieve your investing entrepreneurial and business goals. See you next week on the mad profit podcast