Are you someone who lost a job due the ongoing pandemic and want to try out an entrepreneurial journey? Then you should check out Kyle’s inspiring story. This episode may cast out your doubts about online businesses and go try it yourself.
Jaryd had a chance to speak with Kyle who is an experimental psychologist turned business owner and investor. He lost his job during the pandemic in 2020 and changed his life through his first business acquisition and going on to become the founder and CEO of a larger organization.
We have discussed how he lost his job from the pandemic and bought the business, what type and how much for, what the multiple was and what is the income per month and what we did to grow it (without too much work).
We also talked about how much he sold it for, what he made from the website flip and from holding it for 18 months.
Last but not the least, Kyle will share his amazing insights about what he learnt during the website flip process.
Surely, Kyle’s lessons are something you don’t want to miss if you are a first-time buyer.
This is an inspiring podcast episode you will love to hear. Tune in now!
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03:10 What kind of business Kyle purchased?
08:17 Process & Results
14:41 How many hours did you invest?
15:17 When did you sell your business?
17:28 Monthly income & Profit
21:51 Kyle learned a lot
27:55 Due diligence takes time
30:56 What’s next?
35:42 Kyle has advice for you!
Courses & Training
Courses & Training
➥ When Kyle bought the business, the previous owner gave him a strategy that works. Kyle decided to stick with it. So instead of using paid advertising or social media, Kyle reached out to influencers with an audience to promote the product.
➥ Selling a business at a time when it is growing can be very attractive to buyers because it makes the business more scalable. And that’s what Kyle did!
➥ One thing that Kyle learned is to not get too attached to any one business when buying. He advises that it’s important to do due diligence on multiple businesses and decide ahead of time what you’re willing to spend and what conditions you have. It’s important to stick to those conditions and not make bad decisions out of fear of losing a particular business. There are always other options and opportunities available.
About The Guest
Kyle is an experimental psychologist turned business owner and investor. He lost his job during the pandemic in 2020 and changed his life through his first business acquisition and going on to become the founder and CEO of a larger organization.
This is an online income story, you do not want to miss. Hi, I'm Jaryd Krause host of the Buying Online Businesses podcast. And today I'm speaking with Kyle. Kyle is a Buying Online Businesses community graduate. Kyle is an experimental psychologist as well-turned business owner investor, he lost his job during the pandemic in 2020. And change his life through his first business acquisition from joining BOB and then scaling that and going on to become the founder and CEO of a larger organisation.
Now, in this podcast episode, Kyle and I talked about the website he bought, and the flip that he did, we're talking about how he lost his job and how he was sort of not forced, but pushed into earning an income online a lot quicker than what he had expected. We also talked about what type of business he bought, how much he bought it for, what was the multiple and what was it making per month. Now we move on to talking about what we did to grow it, how we grow it by creating a system and a process that we hired somebody else to run without doing too much work himself.
We also then talked about how much he sold the business for what he learned from selling the business, some insights that he shared with people that are buying their first business and selling their first business. And we talk about what he made from the flip. And what he made from holding it for 18 months, which is ends up to being well over 150 grands all up.
So quite a substantial flip, and quite a successful flip, I would say. What he learned during the process, as well as some of the things that he shares in this podcast episode some amazing insights to people thinking about leaving their job and wanting to buy a business people thinking about buying a business people doing due diligence, and people that have capital invested in other investments that may not actually be suitable to where they're at in their lifestyle. So, there's so much within this podcast episode. It's definitely a story that you don't want to miss if you want to earn an income online.
Now, because we do talk about buying a site and doing due diligence. I have to have a disclaimer here. Please note, you should know how to do your due diligence. If you don't know or you want some help get my due diligence framework, you can go to buying online businesses.com forward slash free resources and get my due diligence framework that I use call us and so many other people have used to buy an online business it takes the guesswork out of the whole experience.
And you can get that from the link in the show notes. Do you want to build or grow your content website niche website builders have helped hundreds of people that take their content websites from a few $100 per month to over 10s of 1000s of dollars per month with crafted content creation, buying age domains and link building strategies?
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Kyle, welcome back to the podcast. So the first time we heard from you was probably about nine months ago, maybe 10 months ago when you came on and discussed the purchase of your site maybe even longer.
Probably maybe it's been a little while.
Jaryd Krause (3:26)
Probably, 12 months ago time of publishing. So now you've got some exciting news. And I want to break it down of what's happened. You've bought your first online business and you've sold your first online business for a profit flipped it. Let's dive in out of that, how it feels to go through that process.
It feels good.
Jaryd Krause (3:51)
So now that I've mentioned this, people are dying to know what type of business did you buy? How much do you buy it for? And when did you buy it?
Yeah, so it was a membership business. I bought it in 2020. around July, I forget the exact date, July, August. Around that time, the multiples were lower than they are now. So, I don't remember. I think it was like a 20 26 Multiple or something about a four, which ended up being just over six figures. Yeah, just a little bit over six weeks.
Jaryd Krause (4:24)
So, it was just over like six figures. All right. Are we able to talk numbers like are we talking like 115? Or are we talking?
Oh, in that area? Yeah, it was around there.
Jaryd Krause (4:37)
All right. The reason I'm asking is because I'm just going to I'm just curious about how the profit was. I'll ask eventually. I'm going to find out what the profit was in terms of how much you grew the business by and what you sold it for. And then also what we can't kind of main the middle from holding the business. So, if it was 26 Multiple and It was doing, let's say 115 divided by 26, very low multiple, isn't it?
Yeah. At the time. I mean, that was reasonable at the time yet.
Jaryd Krause (5:13)
So roughly around the $4,000 range.
It was actually a little bit less than that, I think. But yeah, roughly, it was I think, three, something.
Jaryd Krause (5:23)
Okay, cool. How long did you hold the business for? I mean, you could so you came and joined the community, the bulk community, and then you bought the business? And then was it like maybe a couple of months after you own the business? You said, Hey, Jerry, can we do some work in growing this together? One on one type stuff? Right? What was the timeframe there? Was it a couple of months? Or is it less?
I think so. I think I just when you buy a business, you have revenue, and then you'd like to grow it. But because you have revenue, you can spend it on things. And I thought joining the inner circle group would be a good way to spend some of that, yeah, cool income, could learn how to grow it.
Jaryd Krause (6:05)
I've talked about some of the stuff that we did, and actually have used some of the work that we did in terms of automation, and finding out how to grow your business without trying to do external strategies that other people are doing that have worked for them that may not have actually worked for this business they could have.
But we found a smarter and better way that took less time. And I've talked about that without using your name, and figures and all that sort of stuff. But just some of the principles and the strategies that we've used. And it's been hugely beneficial for other business owners, from where I've mentioned it in other publications, and I guess let's dive a bit into that.
Now, what was the I remember, when you came to you had some growth strategies that you wanted to implement and work on? with the business? Do you remember those and what were they and what did I say?
I don't remember. I'm sure I had a lot of ideas that, but the specific so when I bought it, the owner gave me a strategy. He said, I use this strategy, and it worked. And then I told that to you. And you said, Okay, well, let's just do that strategy.
And I basically, instead of doing paid advertising or a lot of social media or any of that kind of thing. It was basically just reaching out to other influencers, people who already have an audience and then seeing if they'd be interested in promoting the product. And that was it. That was the entire strategy.
Jaryd Krause (7:32)
Yeah, it's so simple. I remember one of the strategies had was let's create a blog and put some content out there and get some search engine traffic. And I was like, yep, we could do that. And I think that's something we can work towards, I think it will work. But if like, let's work our way up to that, first, let's work out what and how has the business already earned its money? How do they get their subscribers?
And I think, that you found that out from the from the seller, if anybody in business is thinking about like, how do I grow my business? That's the magic trick, really is like work out? How has the business made its money so far, how's it acquired its traffic and got it sales and customers and make that process better? Right, so you are a bit time poor. Having a young family, you had some time restrictions that you only wanted to spend a few hours on the business, what was it was it five hours a week, or 10 hours a week.
it gradually got, I think it started at 10, maybe even 15 hours and then it gradually, it shrunk as time went on to maybe about six hours a week.
Jaryd Krause (8:42)
which I'm very proud of you for doing because it can happen. The opposite way for a lot of people are making good money, let's pour some more time into it. And that you can drop the ball in other areas like family and things that you love to do. So, I'm really stoked with what we did that.
So we had to get past some of the stuff of the operations that you were doing in the business, in terms of content creation, and things that you didn't want to hand off to somebody because you wanted to keep that quality for the delivery of people that were members in this business, which I think it was great that you kept that but it took us a bit a while to hash out the strategy that we were going to use to acquire more customers. Tell me about that process and how did you learn from that?
Yeah, I think, when people buy business, I think the first thing especially when it's based around content, which mine was it's a membership business, but people the membership was you get some content once a month. And I think people the first thing they want to do is farm out the content, which is a strategy and that's fine. And I looked at that a little bit.
I just didn't feel comfortable that the quality because of the way the business was set up. The quality of the content was really important. It's not like you just you could have one blog posts that where wasn't great, but it still got you traffic or something. If the if all of the content was I mean, everything was about the people were paying to receive this content.
So, it had to be really good. So, I felt most comfortable the I did some training with previous owner and I felt most comfortable creating the content myself. So what we did instead was, well, to grow the business, we're going to need to hire out some other things like reaching out to people who could promote it, doing customer service emails, all that kind of stuff. And that's, helped me figure out how to how to do that you and Charlie, actually, Charlie gave some really good advice on that.
Jaryd Krause (10:33)
Charlie's really good at that team building, isn't it? So yeah, basically, what did we created a process and a system for somebody to follow, and then we hired them and got them to run that system. And we sort of had that system, usually, what I like to do is have a process and a system producing a result before we hire somebody. So, then we can just get them to follow it and, and produce the same results.
And then as time goes by, we can tweak it and make it better. And that's what we did was we found that, alright, let's hire this person. And she ran a system and suddenly getting a result. And I remember distinctly, they were like, this is working quite well, I asked you the question, how many hours is she doing? And you told me, I think it might have been about five and I said, Cool. All right, if she's doing five hours, and she's getting this result, and we didn't want to double it, how many hours do we need to put in? And the answer was 10.
I think that was rough numbers, rough figures, vaguely from my head? And how did that work? Did that double the results? Did it make it? Was it less than double? Like can you remember that how that process happened?
Yeah, so the way it worked, I hired her through an agency. So, it was her time was fixed. But it was just in terms of what I had her focus on in that amount of inner fixed time. And so, we decided if the way that she's helping grow the business is by reaching out to new people, then that should take up the majority of her time, instead of creating Facebook posts or something or whatever else I could have had her working on.
So, we just set limits on okay, you should reach out to this many people per week. And then it was okay, if you double the amount of people that you reach out to, in theory, if you have the same response rate, you should get twice as many people. Of course, there's kind of a ceiling there when your strategy is reaching out, because, of course, I'm always surprised at how many influencers, there are in any given space, how many people who have YouTube channels, and blogs, or even just Facebook groups, how much reach there you can any niche, there's so many people that have a lot of reach. So that was something I learned, but to your point, yeah, just asking her to reach out to more people, it did help grow the business more.
Jaryd Krause (12:57)
So yeah, it's basically a there is a ceiling, there is a you get to a point where doubling, it doesn't get the exact same results. But in theory, if your inputs are minimal, and you're getting these x-results, and then you want to increase it, then you just increase the inputs, which we did.
And this is something that I learned myself through my businesses with ads, if these ads are producing this result, and I'm putting x amount of money in, let's put more money in, and I should get more results. But when you do get to that point of the more money that you put in doesn't always equal more results. So that's something for people to be conscious of and aware of. And I don't think we max that out too much, which is a good thing. And did we or not.
And her hours were fixed. So, it was a fixed cost. For me. It's just what are you what are you spending your time on? So, it wasn't like I was putting extra money into having her do that?
Jaryd Krause (14:04)
Yeah. Which is really good for the scalability of a business as well when you are selling your business and it's growing and you have somebody running, but she was basically running your business really. And you can hand that off to somebody you know as a very attractive for a new buyer.
So, you sold it a really good time. A lot of people in the inner circle. We’re saying like when he told us we're saying hang on Kyle, what are you doing? Your bananas you can't sell your business right now. But it is a good time to sell your business when it is growing and it was a good time for you personally to sell it. So, I wanted to ask how many hours were you spending on the business per week or per month prior to selling at.
About six I was pretty strict on that because I and you know this I started another business which was starting to take up more of my time and my family grew so that was taking up more of my time also. But it was six, I was pretty strict six hours per week because I can only spend a couple hours three times.
Jaryd Krause (15:05)
Yeah. And you're getting good return on your other business as well. And it's worth spending that time on that other business. Cool. So, you bought this mid 2020? When did you sell it? When was the sale date? I guess?
Well, it's officially I mean, it's been a little while the sell process has actually been a little bit prolonged for reasons we could go into if you're interested, it has to do with the payment processor I was using and the buyer being in a different country and complications about transferring payment. I don't know how interesting that is. But those are real things that happened.
So, the actual purchase date, it's been about a month since it's sold. But I still we just the last week did a final agreement, because what the buyer ended up having to do was rebuild a lot of the systems, and they were willing to do that. It's just that the payout structure, now is it's not all upfront, we're gonna have a, there'll be most of the most of it upfront, and then in a few months, there'll be another payment, and then a few months, there'll be another. so just this last week we finalized.
Jaryd Krause (16:15)
We're getting through that and sounds like a massive teething problem, to be honest, changing a payment processor. As a new owner, it sounds like they have some experience in the space or are able to hire people and use developers which is quite good.
Yeah, I'm actually excited, because, when I came on about the business, I actually knew something about the niche, because I dabbled in it myself. But I'm not I was a first-time business owner, I didn't know anything about running a business. I had you guys to help me out.
The buyer, the person I'm selling it to, is multiple business owner has a lot of experience in this niche. So, they have a team that can do all kinds of stuff. So, I'm actually excited because I know that they can take it and do all the things I wasn't able to do. And I'm still getting a good price for that. So awesome.
Jaryd Krause (17:05)
So, it's a massive win all around for everyone really, That's great. That's really good. So, you sold it about a month ago. So, time we're recording. That's let's say, end of January, I guess early Feb. 2022. So, you owned it for about a year and a half. Okay and so How much was it making per month when you sold it roughly?
That it was just bit like 5800? Or like just shy of 6000?
Jaryd Krause (17:44)
So, just say 6000? Okay. So, 5800 ish. And it was still growing. So obviously, it could have been, if you had a few more months on the board, you would have had a higher average monthly net profit base your multiple off. Cool. Okay, so 58 ish. And what was the multiple? And how much do you sell it for? If you're open to sharing?
Yeah, the multiple. I think it ended up being way there was some back and forth. When we had discussed there was a multiple we did research. And then anyways, it ended up being around 36. I think the multiple.
Jaryd Krause (18:25)
Cool. So, you went from 26 to a 36. Multiple in year and a half.
Yeah, I that's just not me. That's just the industry. That's industry. Well, one thing I learned, which is very important, for people who are selling is when you're doing research on how to price your business, and you're looking say on Empire Flippers-tThe businesses that are listed there are the ones that haven't sold.
So that might not be the best representation of how much to price your business if you want to sell it. This is a lot of back and forth I had with my broker and they were very polite and explaining to me- Yes, the ones that sell our where it had the lower multiples, and we have that data.
Jaryd Krause (19:05)
I'm so glad that you brought that up. Because when you said to me, Hey, Jaryd, I want to sell the business or you said to us in the group and we're like what are you doing, you can't sell the business is growing, you're going to make so much more money. And then you're like this, you had your reasons you want to sell it. Very good reasons. And I'm glad that you sold it when it came to selling I was we were looking at we went onto a bunch of different brokers and had a look at the prices and the multiples and like this is what you could you could get based on these multiples.
But quickly, we discovered that the it's a lower multiple and a lower price and they're the businesses that sell a lot quicker. So, multiple of 36 for a membership business is really good for somebody who purchased it, especially with the retention that you have on your business and the scalability of it, the system that we built, you can hand over to them just excellent. If we go 58 ish, 100 times a 36 is around 210 grand you sort of fall.
It was less than that. But yeah, in the ballpark.
Jaryd Krause (20:18)
Cool. All right. So that means if we bought it for sale, or 115 ish and sold for about 200 ish. It's about 100 grand flip in a year.
Right. I don't know the actual numbers. But I think the actual difference was.
Jaryd Krause (20:36)
70 grands, cool, we'll go in the fleet that's just in the flip, let alone the income that you made. During that year and a half, going from the low, like high three grand per month range up to the just under six grand per month range.
So, it was close to doubling the business in a year and a half, with close to doubling the business in year and a half, with roughly six hours of work per week. You got to be happy with that.
Yeah. I mean, I think the 12 months, like we said it was fine, it was five something. So, multiply that by a year and a half, plus the profit on the sale price. And that's, that adds up to quite yet.
Jaryd Krause (21:27)
So, 5000 like to say roughly 5000 times 18 months. Yeah, so 90 plus your 70. It's about 160 160. Which is going to go nicely for your next ventures, great. Congrats. So, what was the highlights? And what was the what did you learn from it? In the sale of the business? And then I'll ask some more questions. I won't load you up right now.
So, I mentioned I've been having this issue with the payment processor, just a little bit. It's the payment processing on the site is run through a third-party payment processing system. It's not like connected to the site with stripe or something. Which didn't seem like an issue. It's a well-known payment processor. But it's just not set up for sale, it gets tied to you person.
So, for example, I started receiving payments through my PayPal account. And that was good. I started getting people to sign up with PayPal who wouldn't have signed up with a credit card, maybe necessarily. But then when I went to sell the business, oh, we can't transfer the Pay Pal account. And we can't actually, we can't. So, these issues with payment processing.
So, I guess what I learned from that is when you're setting when you're setting up your business, or when you're in your case, when you're buying a business, I didn't have this issue when I bought it because the seller was based in the US, when I sold it the seller is based out of the US and that's why I had this problem. So, pay attention to that kind of thing. It's you don't know.
So, it can be hard to pay attention to that. But it's not something that even occurred to me until and actually it didn't come out. When they were doing the due diligence from Empire Flippers either it didn't come out until someone we tried to do the transfer and it didn't work.
Jaryd Krause (23:21)
Yes, I mean, the payment process that used is it's common. But there's not that many people that are buying and selling businesses using that payment processor. So, for us in the industry, even Empire Flippers, it's not something that were like, Oh, we're very aware of this, because it's a regular case. That's really good to know.
And sometimes that happens without anybody in the industry knowing. But the good thing is that you got around it just sounds like it took a little bit longer. And that's going to take a little bit longer for you to receive the full funds for the business.
Right. Which is fine for me. Yeah, I'm just happy I got sorted because it could have been a deal killer. Yeah, I could see a buyer just okay. I don't want to deal with this and moving well, that's right.
Jaryd Krause (24:09)
If it would have been a different buyer that hadn't had the team and hadn't had the experience of running up multiple online businesses it could it could be a deal killer, where you would might have to go back to the drawing board listed again. And then and then make sure you sell it to a US buyer. Right. That's a big issue.
So, well, it's more than just a teething issue really, isn't it? what else what else did you learn along the process from purchasing to owning and selling that you think is important for first time buyers or first-time online business owners?
Yeah, so that last bit maybe wasn't for first time people but I guess it is. What else did I learn? I did due diligence on a lot of businesses before I bought this one. And all I just wasn't fast enough. And I'm sure it's even harder now than it was then. But, something, this happens to and if you're buying a house, it's the same thing.
I know a lot of people who are trying to buy a house right now and it's people get stuck on, this is the one for me, the business, the house, whatever it is, and then you lose it, or you start to make bad decisions, because you're afraid you're going to lose it, you have to make up your mind ahead of time, what you're willing to spend what your conditions are, and stick to those conditions.
And if this one doesn't work for you, another one will, it's an endless supply, it keeps coming, things keep coming. So, don't get hung up on any one thing on any one business. That would that's something that I learned just keep chugging away.
Jaryd Krause (25:42)
Yeah, I'm so glad that you mentioned the taking the emotions out of buying a business and the processes of it, because yeah, I'm glad that you said it. Because I say it very often, hey, do a lot of due diligence on businesses. If you miss out on one, there's going to be another one coming back can be very, very hard to hear. And it can be even harder to hear once you've just missed out on a really good business. I had a case this week where I started doing due diligence on somebody member from the community, they sent me their deals, and within a couple of minutes, I could see that the business was a great investment.
And this is without me seeing how much the business was or how much the or the average monthly net revenue was or net profit. And then after going through the whole due diligence, I realized Oh, wow, okay, this thing's going to go fast as a few things that you need to check during your due diligence and make an offer really quick. By the time he was able to go away and double check some of these things. The business was pending, sold, he took it very well and said, Look, Alright, next one.
But the good thing about that is when you see one that you're really, you're really close to getting, because, it's a good business is the best thing about that when you lose it the positive side of it, or I shouldn't say you did you lose it because you didn't really have it. But the positive side of you not getting that business is that you can now see you have an image and a visualization and a bar of the type of business that you should be going for.
And when you find it to be swift, with your due diligence to purchase it, I'm very glad that you mentioned that. So how many businesses do you think you did due diligence on goal?
I think maybe like 12, it was in the double digits, which I guess is nothing, I'm sure you've done hundreds and hundreds, but it's a lot when you do them all in a couple of months period.
Jaryd Krause (27:31)
It's a lot when you are new to this. When you've never done due diligence before the first time you do due diligence, it's like, oh, wow, this can take me a full day, maybe even to four days, maybe even longer for some people, depending on what's going on in their life. And to hear people come on and say, Hey, I bought a business within, a couple of months.
People think, wow, how did they do that? It wasn't luck is within that three months they looked at and did you deal on 20 30 businesses in that short period of time. It's just they crammed the work into a shorter period of time than what most people would do in a year.
The other thing too, related to that about it taking a long time, just so the business that I bought, it actually sat on the marketplace for a while. And there were some things about the listing that I think maybe people would look at the listing and think, Oh, I'm not interested in this. But look at the numbers, if it looks and I think that benefited me, because I went in and I crunched the numbers.
And I'm like, why is nobody paying attention? This business? It's the numbers are great. But I think some things about maybe just the way the listing was written just the text of the listing, maybe some people didn't like, for some reason. Don't let that fool you look at the numbers.
Jaryd Krause (28:45)
That's right. There's and some people get fooled the opposite way, as well as the listing looks really good based on the text that's out there. I mean, I know that there's some places, brokers that list businesses and say there's opportunities within the business that I see is like, that's a terrible opportunity. Like that's a terrible growth strategy to implement into the business if you're going to buy this, and you could really cause some pain for that business owner, people can buy a business and get caught out and go hard.
And all I need to do is put through this thing that the broker mentioned. And it's just not necessarily true. They're there to sell your business. Sometimes they do it really well. Sometimes they don't do it so well. And that's just because their organisation and they're an entity and like myself and yourself call away entities and humans and sometimes we make mistakes.
It's just the way it rolls, you know? Yeah, I think you your point there of just seeing the business for what it really is so good because there's a lot of businesses out there like you said, not many people wanted this one, but you picked it up at a great price. Were able to build a team to do the work and built it without you having to slave ever.
The other thing too is I was able to see some of the content of the business before I bought it. And the content was really good. So, the numbers were good. I thought the content was fantastic. So, it just checked out.
That's, something when I was looking, sometimes even if it was a content site or something and you look at the content, it just isn't good. Even if it seems like it's doing well. So that was a red flag for me. Also, when I was doing research, yeah, of course, that might be a personal thing for me.
Jaryd Krause (30:29)
No, I think it's a good thing for all businesses to understand. Like, if the content on the site and within the membership is not valuable, then you're buying something that's going to depreciate.
Eventually, that'll catch up to you. Maybe Google algorithms haven't gotten there yet. But eventually, if the contents not good, and you're reading it, and that it's not good, other people are gonna figure that.
Jaryd Krause (30:51)
yeah, exactly. And that's why good content audits are critical. So, congratulations, call where to from here for you. What's, what's next on the agenda? In terms of business?
Yeah, so I started a business. This is a SaaS business, in the industry that I was I became an online business owner, on account of the pandemic, I lost my job, but like, I'm sure a lot of people did, and just went into the online business. But then while I was running it, some people I used to work with reached out.
And there was an idea for a SaaS company we had talked about, and then we decided just to do it, and it's running. Now, it took us about a year to get put it all together, which was fine, it didn't cost us very much money, I think I only put in, maybe $10,000 Total to start up a business a SaS business. That's pretty good.
And we have about five paying customers now. And we're on track to get a lot more and the subscription price for this business. It's a, it's also a membership business. So, it's a SaaS membership. So, they pay monthly to get access to software that we make available online. It's a much higher price than the subscription price for the previous business. So, five customers go a long way, compared to, however many I had with the other day.
Jaryd Krause (32:06)
Yeah, it's funny. When you say, Oh, we've got five, we've got five paying members. And I say awesome, people are probably thinking, hang on, if it's five times, a couple of $100 or $50. That's not particularly awesome. But the price point in which your software is very specialized for this niche, which is, you didn't just start a business, you solved a problem with this.
And you already had a big network of clients, that network of clients, but a network of potential clients because of not just your network in the industry, but the other the other partners within the business.
So, it's software for company for factories that make denim that make jeans. And it's for these machines that I can talk about it. It's not a secret this this business, there are lasers. So, when you buy jeans from a store, oftentimes they're pre-distressed like they've been worn in before. And nowadays, people do that with lasers, carbon dioxide lasers.
So those are the machines that do that are half a million dollars. So, we've made some software that makes making designs for that those machines really easy. And so, but if you're buying software for a piece of machinery that you just spent half a million dollars on, you can charge a little bit more than an info guide for your average who wants to make more yet so it's a little bit different.
Jaryd Krause (33:29)
Well, you don't think about somebody that's in the make money online space me so much competition, versus how much competition? Do you have? None at the moment? Yeah, and that's why I was excited to work with you on this business, and some of the things that we were able to implement and change, and it's looking very good and very promising.
So, I look forward to hearing more about it in a year from now. And hopefully, some of these, these core strategies come into fruition and those higher, white labelling, or sorry, not wholesaling, some of the software would be really beneficial, I think.
And actually, it's funny you say that, and I don't think there's no reason I can't talk about this. But that is becoming a strategy for us. It's basically wholesaling licenses in bulk to salesmen who will then take them and sell them to individual factories across the world. And that's great for us. And I have to explain that to you.
Jaryd Krause (34:25)
It's means less work. I mean, really, and when you think about it, similar to your business that we were just talking about that you bought, and sold flipped, you are basically hiring people to be salespeople, but you're not actually paying them to be salespeople. You're paying them per sale, and this is what these salespeople will do for this business as well based on commission. So, it's pretty exciting. It's not just B2C. I'm really excited for this business to hear more about it in a year.
I'm excited added to, oh, you know what I can come on and talk to you about it.
Jaryd Krause (35:03)
Let's do it. I have a laser, [crosstalk] cool. So out of just thinking about being in business, what you've learned what you could possibly share with people from, being in the career space, having a job up until the pandemic, losing that job and sort of being forced into being a business owner, for beginners who are thinking, Alright, I want to not lose my job, but I want to replace my income, I want to leave my job and start to put on my business.
What would be one or two, or maybe a few of the things that you learnt that are highly beneficial principles or strategies and philosophies to carry as a business owner for beginners?
Well, the first thing, so the way that it happened for me is that I said that I lost my job was not the ideal way to jump in. But it forced me to jump in. And the other benefit is that it gave me some capital because I got a severance. And I had some stock that I was able to cash in, which gave me the capital that I needed to buy a business. But I would not recommend that you quit your job before because I spent six hours a week to run the business that I bought. And especially if you don't have small children now.
So that takes a lot of my time. But if you don't have small children, you probably have six hours a week you can spend even if you do have small children. So, I would recommend trying it without quitting your job. Because to be honest, I had when I had my job, I was fantasizing about owning an online business I was doing, I think a lot of people do this.
You listen to podcasts, you read articles online. And then sometimes you just you never take the jump. It's just a fantasy. In my case, I was kind of forced to take the jump, which worked out. But I wouldn't recommend I would say just take the jump, you don't have to quit your job. You don't have to just try it out. If you have some capital to do that. That's great. Sorry, what was your question? Again, I got a little bit lost.
Jaryd Krause (37:09)
It was just based on as a business owner, becoming a business owner, what are some of the things that you learned that you think are valuable for people that have come into the space but while you maybe mull over that and think about that, I want to talk to your point about the quitting and making the jump. Yeah, I agree with you don't quit.
And this is what I say to most people that come to me and they say, Jaryd, I'm going to quit my job, I'm going to buy a business. I'm like, Cool, I'm not working with you. I don't want to work with you if you quit your job, because then you're going to make a hasty decision, because you're under pressure to earn an income. And that'll cause you to possibly buy a bad business.
And it'll be a bad experience, like you said, make the jump, when you have a job and you have an income stream, it's less of a risk, it's less of a jump. You call it was a is a steeper and higher jump than then what most people should take if they had that fantasy, like, like you did. And like I did for 10 years.
I guess one thing that I learned is that it feels good to control. So, one of the ways that I paid for my business is I traded in a lot of stocks that I from my 401k, actually part of the three was the Cares Act, which was part of the pandemic, which is you can actually cash in your 401k for a brief period without having to pay the penalty.
So, I did that, because I'm kind of, I'm not big on the stock market, because I don't control the stock market, which is one of the things. It actually felt really good to take, even though maybe if I left it in the stock market, it would have done all right, maybe a 10% return, but what return did I get buying my online business with that money, much bigger than that.
And losses compound more than gains, so maybe at 10%, on average, but in actual return, it would have been, I don't want to get into all that. The point is, if it felt good to take money from something that I didn't control, put it into something I did control, and then and then to see it work, it feels it just feels a lot better. Even if the stock market made me the same amount of money. It's a lot less satisfying, because I have I had no control over that.
Jaryd Krause (39:10)
So that is juicy for people to chew on really the control aspect. And I've mentioned this in webinars and other pieces of content. But yeah, so glad that you mentioned that car, because that control aspects is when you buy a stock, you can't manufacture growth. So, a lot of people think, oh, you can't control how the stocks going to perform.
And that's a bad thing in case it goes backwards. But on the upside, you can't grow that stock anymore as well. It's not in your control to manipulate it to grow more or add value when you buy other assets like even real estate, physical property. But there's online real estate, digital property, you can manufacture growth, and that's a really good point. That's a really good point.
Yes, that feels good to do that to be able to have more control than then then your employer gives you because they can fire you at any time. And more control than an investment like a stock market gives you because there's no investment that can do in my single stock to make it give me more per share than what it already gives.
Jaryd Krause (40:20)
Yes, spot on. Kyle, thank you so much for coming on. Congratulations on what you have achieved and know that you were forced into making a jump, you wanted to make an income after losing a job and you've done exceedingly well swimmingly well, and moving on to bigger and better things. So yeah, I'm sure everybody looks forward to hearing from you in a year's time with to see how your, denim cutting business goes.
Thank you, Jaryd.
Want to have more financial and time freedom?
Jaryd Krause is a serial entrepreneur who helps people buy online businesses so they can spend more time doing what they love with who they love. He’s helped people buy and scale sites all the way up to 8 figures – from eCommerce to content websites. He spends his time surfing and traveling, and his biggest goals are around making a real tangible impact on people’s lives.
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