Spend More Money To Make More Money
Today I want to cover an important component to expediting the growth of your online business, Reinvestment.
When you start from scratch and build a property or offer that starts making money it is very tempting to take the proceeds and buy something for yourself. I can’t say I would blame anyone for doing that. There are few things more satisfying that earning a dollar from nothing and it feels good to reap the benefits.
With that said, I would encourage all the grinders out there to limit personal spending to a minimum and reinvest as much of your profits as possible. Assuming you are making wise decisions reinvestment can help you grow your business and profits exponentially.
Why Reinvest?
A common response I often hear to reinvestment advice is, “WHY?”. It is a valid question. Profits are typically earned through hard work and will likely grow with the same hard work. I don’t dispute this at all.
The reason you should reinvest is to grow faster and profit more.
The pace of Internet marketing and technology trends grows faster than anything we have really seen historically. What is hot today is gone tomorrow. Competition is rabid and it is important to grow and stay ahead of the game as much as possible.
Reinvestment allows a one man operation to open up the time bottleneck and scale.
What To Reinvest In?
Spending money alone isn’t going to make the strides. It is about reinvesting wisely and evaluating what gets the most return for the investment. Some good areas to reinvest are:
- Outsourcing / Services – Alleviate some of your time by outsourcing some of your less competent skills. Make sure you do your due diligence to find the right talent for a value price.
- Advertising – It’s all about the finding more of the target audience. Use your profits to test various advertising outlets. Don’t be afraid to try anything and everything that seems reasonable (including offline options such as direct mail, classified ads, billboards, radio and TV if relevant).
- Tools – I’ve found tools to be a critical component of my success. Anything that can help you get the job done quicker or better is worth consideration. Study up before buying. There is a lot of crap on the market.
- Education – Yeah, it’s true. Some of the books and info products out there are actually good. I’ve spent a lot of money on junk but the good stuff is worth it’s weight in gold.
- Hosting – Hosting was a lesson learned for me in the early days. I built a high traffic site but didn’t want to burn my profits up on a dedicated sever. This meant my site was often slow during peak times. When I finally made the move to a dedicated server my profits almost doubled overnight. Made me sick that I’d waited so long.
Feel free to suggest more if I left a good reinvestment opportunity out.
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3 Responses to “Spend More Money To Make More Money”
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I have to say this is the current stage I’m in. and I think I’ll be here for a while. At least until my websites revenue can cover its expenses, personal expenses & spending, buying more domains. I started out as a developer then I went into domaining and I almost left out the developer part for a while but now I had to go back to development beside domaining but in total different fashion (knowledge, strategies, taking outsourcing to the minimum since let’s face it most of freelancers sucks or really asking for too much).
Reinvesting is one of the topics that I keep “rethinking” about it everyday. I’m not thinking about to reinvest or not but where to reinvest, which website should I reinvest in it first, etc.. and I always keep coming back to the same point. Reinvest the biggest part in what will yield the greater return but also don’t forget your small guns.
Some people might think that thinking too much in such points is useless but to me it’s what really important.
Brian, I saw your domaining part and I have to say you have/had great domains but I never see your developing part until now. I just subscribed to your Newsletter and also Bookmarked your blog for further reading. Please don’t stop writing. I like the feeling of finding more people taking the same approaches and thinking the same way.
Good Luck,
Sameh
Thanks Sameh. Coming from the domain community makes the “project” decision that much harder. To be honest I really stuggled with this early on and still do at times today. There are so many options and it’s difficult to focus at times. However, focus is critical.
AVOID the bright shiny objects as much as possible. Project jumping leads to missed opportunities. It’s much better to weigh the options and focus on one or two core projects and push forward with blinders on.
Thank you very much for sharing this. I have subscribed to your RSS feed. Please keep up the good work.