Early in 2025 I purchased a website that provided a service to the Mexican market. Its revenue model was to allow the user to perform a certain task easily, then charge them for the end result (~$2 fee).
The site was created in 2021 and in the past had generated $28,000 of revenue annually, most of which was profit. When I acquired it, it was on a steep decline in the search rankings, only making $3,600 annually and eventually hit a floor of around $1,200 revenue. I paid $5,000 for the site (with some other sites thrown in to sweeten the deal). For those interested I paid around 3x the annual revenue of all the sites I acquired.
To recover rankings I decided to focus on one thing and one thing only – back links. For this I used a good but expensive provider. My goal was to spend $500 per month, netting between 3 and 5 backlinks pointing back to the site.
Months 1 and 2
In the first month there was zero change in site ranking. At the start of month 2 the rankings suddenly jumped from around position 9 or 10 to position 5 or 6. And how many extra site visitors do you think this resulted in?
I was now receiving 4x the normal volume of Google Search clicks!
Normally I would discount this jump as an anomaly. For example, perhaps some Mexican holiday had caused things to change BUT I have a control website.
As part of the original deal another site had been thrown into the mix that ranked for pretty much all the same keywords. That second sites traffic and rankings did not change one bit during this period. In fact they declined.
Therefore I can almost conclusively say that back linking was the reason for the jump in ranking.
Interestingly I had only acquired 3 backlinks during that first month. However they were from well regarded sites with a domain rating of between 20 – 30 (the maximum rating being 100). Just 3 links had quadrupled inbound clicks!
More importantly a move of 4 positions up the ranking resulted in 4x the traffic. On average, position 10 receives 1.5% of search clicks but position 5 receives 5.1% so the 4x in traffic tallies well with that general statistic.
So where do we go from here? Obviously, position 1 is the goal and I think that is achievable, as my industry is low competition. Position 1 receives 40% of all search traffic so that is another 8x from where the site is now. That alone would restore annual revenue to $28,000.
How Much Profit Does this Make?
Purchase price: $5,000 (including some other sites but we’ll leave those out of this calculation)
Back link cost: $3,000 to $6,000 (the latter if I need a full year of backlink building, which I’ll assume as worst case scenario)
Cost of my time: $2,000 (2 days total at software engineer consultancy rates)
Total acquisition and investment expenses: $13,000
There are 2 scenarios to calculate return on investment:
Scenario 1 – Keep the Website as a Cash Flowing Asset
Annual income of $28,000 less back link expenses ($3,000) = Annual Profit $25,000. Factor in the purchase investment @ $13,000 and the annual return is 192% on original outlay.
Where else could you get 192% return on your investments? Nowhere!
Scenario 2 – Sell the Website
In this case I would keep the site for 2 years to show a good track record of profitability to the potential buyer. Calculations as follows:
Total profit (same as scenario 1) = $25,000 x 2 = $50,000
Less purchase cost: ($7,000)
Website value @3x annual profit: $75,000
Less sales commissions (10%): ($7,500)
Total income for 2 days of my time: $110,500.
Yes that’s a nice number but this experiment needs room to run to see if it’s achievable. However if I scale back my expectations from position number 1 the numbers would change as follows:
Profit According as a Function of Search Rank
When selecting a target for acquisition and improvement I think the most important metric is to asses where you think you can get to in the search results. For example position 1 may be untenable due to a very well linked competitor – but is position 2 possible? Or 3?
With my Mexican site, if I maxed out at position 2 then I would net $55,000 in case of a sale. For position 3 that number drops to $28,000. Even with the latter that’s still an earning of $14,000 per day of my time. In many countries that’s a full time salary!
How to Scale?
When I bought this site I promised myself I would NOT be doing any writing, blogs and other time consuming things. It was to be a pure back linking experiment, with almost zero of my time invested. Therefore, if I will not expand into other content areas this sites scalability will be limited once I rank at #1 for my particular search terms.
Thus I will sell the site once I get close to that ranking goal.
I’m already looking at acquisition of another website but at 10x the size (~$50,000 purchase price). The key is for that site is that it’s in a similar position with plenty of ranking upside. The upside, all else being equal, is somewhere between $140,000 and $1.1 million per day of my time.
Now that’s food for thought (although I suspect this process will be less scalable the further up the ladder I go).
I’m holding off for now though as I want to run the Mexican experiment for at least another 4 months to see how it actually goes! Look out for updates here!