761: Shopping for Cash Flow: Buying an Online Business in 2026

0:00When I started the show 13 years ago, it was just me wearing all the hats. But as it's grown, so has the team to support it. And I'm super grateful to Adam for his editing skills, for Ava, who produces the video versions that you see on YouTube, to Sheila, who does the detailed write-ups for the Side Hustle Nation website, and to Teresa, who uploads everything to all the different podcast apps. When you're a small business, the right hire can be make or break. And that's why when you need to get it right, think this is a job for Indeed Sponsored Jobs. Spend less time searching and more time actually interviewing candidates who check all your boxes.

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1:14You can buy how much they're making or how much they say they're making, how much they cost, and what might make a good deal for you. My guest has helped broker over 300 of these sales, totaling over$7 million in lifetime value. From just website brokerage.com, Joe Burrell. Welcome to the Side Hustle Show. Hello, Nick. Thank you for having me. You bet. So let's say I'm this person. And I'm bought into the idea of let somebody else do the hard part, the getting noticed on the internet part, the getting the business off the ground, that zero to one phase. That's really difficult. And so if I want to skip that part, it's going to cost me some money because somebody is going to get paid for that effort.

1:53But where do I want to go to see what types of businesses are available for sale? Right. Okay. So there are a few public marketplaces that you can go to, and we'll name a few of them as we go. But the one that we're going to look at most, it's the biggest, has the most listings on there is Flippa, Flippa.com. Yeah, let's take a look if you are willing to share some of the listings that caught your eye. Of course. Yeah. As you can see, most of these listings, you have to sign an NDA in order to get access to these. What's your take on that? Is it worthwhile to, oh, that looks interesting to me.

2:22What would make it interesting enough to be like, yeah, I'll go through the, jump through the hoops to sign an NDA. Right. Yeah. So let's just click on one of these and you can take a look. So there is some information that you'll see for one of these businesses before you sign the NDA to get an idea on whether or not you're interested. And that basically will be enough to sort of go, okay, I'm interested. I want to sign. And that will get you access to a lot more information. So it's just that basic NDA and you would click the button and click sign. That's basically it. I don't want to spend too much time on that because what's more important is finding a business that you're interested in.

2:52Right. So let's go back to the browse. Just browse for websites for now. and they have a lot of options for what you can search for lots of toggles you can search for traffic filtered by the business type and so on on the left here so say you've got a mass budget or an industry you want a certain amount of revenue or a certain amount of profit you can put those in there a certain amount of age and search that way and then it'll change your results now if you're a new person shopping what are some of the must-have filters for you so your budget would be in there let's just say your max budget would be say a hundred thousand and you would want to put in the website types so say i'm after only content sites so i just check the content sites there and to be honest i'd probably try and keep it quite broad to begin with especially if you're not sure what you're looking for if you've got some idea then go a bit deeper but having a wider pool to look through especially when you're starting out it's probably a good thing because the chances of you buying the first thing you look at is very unlikely.

3:51So this one's called pestkill.org. All right. So we're looking at a website called pestkill.org, an established 13-year-old content site that says it is doing$675 a month in profit at 97 % margins. I assume it's just hosting is the expense there. And it's been around for a long time. Probably, yes. So I just wanted to pause on this profit multiple. So this is typically how businesses get valued. they they're valued on a multiple on the amount of profit that it makes so this is calculated from the monthly profit so it takes the last 12 months averages it out and then that is what the multiple so 2.7x is 2.7 times the yearly profit so assuming it continues to make exactly as it is it would take two or nearly three years for you to make your money back on that investment if you paid all cash.

4:45Does that make sense? Okay. So in theory, for the$22 ,000 asking price, you could buy yourself$675 a month in cash flow, which whatever, that's 30-something percent annual ROI. It pencils out a lot better than a lot of dividend-paying stocks. And because of that, there's volatility involved. There's going to be work involved. It's not going to be completely passive. Or maybe that's the question. Well, how passive is this transition really going to be? Yep. So the myth of passive income is difficult to come by and it usually involves some form of automations, which need to be upkept anyway, or some stuff that need to be sort of managed.

5:23Yeah. I wouldn't go in with that mindset personally, because if you just buy this site and you just do nothing with it, it's going to suffer for it. Slowly decay. Exactly. The way that the most successful buyers do it is that they buy the business with a strategy in mind in order to improve the profit, improve the traffic, improve the business in order to get the profits higher. So then the investment is paid off quicker and then it's all gravy from there. So you almost have to come in with some webmaster experience in the example of buying a content site. If you've never logged into WordPress, if you've never written a website, blog article, SEO article, this is yeah it might make$675 a month for a couple months but slowly if you don't know what you're doing you're just kind of buying yourself a ticking time bomb right so let's dig into this a little more so every business will have a business description and this is usually written by the seller this graph that we're looking at here is essentially it's a line chart of the profit and the revenue per month so obviously we know that the profit margin is very high so there's not much of a gap between the revenue and profit but i wanted to just highlight this as well so So this AdSense revenue, Flipper has the ability to verify some of the revenue that comes in without you actually having to look at it.

6:41This is all done through the API, so you can trust that it's pretty accurate. You still want to double check the figures because they can be off a little bit, but this line here is AdSense revenue only. Okay. So that basic question, okay, well, what's the rest of it? There's obviously more revenue. So in May, it did 957 in revenue for AdSense, but the total revenue was nearly 1 ,200. So we'll come down here. If we click on this, it's opening up in another tab. But for an experienced eye, Amazon Associates screenshot of the revenue for the last month that they input. So that answers the question really quickly.

7:15That additional amount is going to be the Amazon Associates, which is Amazon affiliate. Okay. So relatively simple site, primarily monetized with AdSense and supplemented with Amazon Associates. We can monetize the informational-based content with display ads. Maybe as a buyer, you're like, oh, I have a path to get this into Ezoic or Mediavine or Raptive or something that is going to have better payouts than straight AdSense. And for the commercial intent content, okay, that's monetized with affiliate partnerships. So maybe you have a path where you could say, oh, I know how to increase conversions on that side.

7:54And if you're just looking at the site, like, oh, here's some things they aren't doing that they naturally could be doing. And on the revenue chart, there appears to be some seasonality, like, okay, spring is big pest control season. And so there's a spike there and it's kind of flat the rest of the year. But that's kind of, it gives you a sense of where the revenue is coming from, kind of the overall strategy that the existing owner has put into place. Absolutely right. Yes. And it was one of the opportunities that I quickly highlighted. Basically, AdSense is well known to be one of the worst display advertising networks in terms of how much they pay out.

8:29So just switching it to another one like Mediavine or Raptive, if they'll accept you on their platform, you're going to increase the revenue just simply doing that. Yeah. And at 10 ,000 page views a month, it may not be whatever their traffic thresholds are. So that's something to consider. but maybe if you can grow traffic, there's a path forward where if you can apply some of the existing skills you have, all of a sudden your breakeven window becomes much, much faster. Yes, correct. That's exactly what it is. That's the name of the game. Probably the most desirable thing for a buyer is diversification.

9:04So by that, I mean diversified revenue and diversified traffic mostly. If you're buying a business that has clients, then obviously you don't want to buy business that only has one client because obviously if that client disappears, then so does everything else. Yeah. And would they give you analytics access to say, okay, where is the traffic coming from? Yes, exactly. So one of the first things that most buyers will ask once they're interested in the business is, can I have access to Google Analytics? Can I have the P &L and anything else that's required to verify that P &L? So screenshots or a video call with the seller going through that information.

9:41And what you might find if There's like 100 articles on the site, like three of them drive 90 % of the traffic. And it's not altogether uncommon, but it's another risk factor. Like, well, if you lose ranking on one of those posts, then all of a sudden your expected income needs to be adjusted downward in a hurry. Yes, correct. You got to do some pivoting if that sort of thing happens and try and change the path of the course. Is this 2.7x on annual net income? Is that typical for what you're seeing in terms of multiples or valuations these days? This is the asking price. Almost always, the seller is going to be negotiable on the asking price.

10:21So just keep that in mind. Most of the time, you can usually go under it and get a better deal than what is currently listed. It depends on how good the deal is and how serious you are about purchasing, because we do have some buyers who are serious. And if it's a business that they want and they know they can do well with, they don't mess around like, fine, you can have asking. Let's just do the deal. But I wouldn't recommend that for most people listening. There's usually some negotiation that happens there. Given everything that you can see, at least publicly, what's a fair price for this pest kill site?

10:51We would need to take a closer look at the details. But essentially, I'd say that this is fairly well-priced. I wouldn't be surprised if this ends up selling for somewhere around$15k to$20k. That is sort of where I would be expecting it as a broker. This is without having looked into it. There might be some skeletons if you dig into it, something wrong with the business or whatever. Obviously, another very important thing is to obviously go to the website and check it out. So you're doing a bit of detective work, making sure that everything that they have claimed is true. So you're verifying that as best as possible.

11:24Yeah, it's an interesting one. And you're like, well, what other assets does the business have? Does it have a social following? Does it have a YouTube account? Does it have an email list? I was close to acquiring a business last year where there really wasn't any traffic to speak of, but it had an email list of like four or 5 ,000. So I was like, well, that would be interesting to acquire that database and fold them, fold the existing content. It was like case study, entrepreneurial content, fold that content into the Sine Hustle Nation umbrella and hopefully warm up this email list into the Sine Hustle Nation community as well.

11:58Yes, that's right. In Flipper, it will tell you more or less what's involved, what's included in the sale. So we can see here it's built on WordPress. The domain name is included. There's email addresses, website files, social media accounts, brand assets. And usually in the description, there will also be a detailed list on what's included as well. So make sure you look at that. And if anything's unclear, so if you find something that's connected to the business and it's not stated to be included, you need to make sure that it is, especially if it's an important part of the business. The other piece of this is kind of the, okay, we'll say it sells for$20 ,000 or that's going to be the fair price.

12:33The question is, well, could I, for less than$20 ,000, rebuild in my own way the content architecture of the site? And I guess essentially what you, I mean, you're buying a 13 year old domain in one way and you're buying like the authority and backlink profile that they've established over that years and not having to do the work of recreating, who knows, hundreds of articles that they may have. But there is a kind of a calculus of this build versus buy equation that comes into play. Yeah. So the biggest benefit, I think, of buying versus building is that I've built many websites in the past and two businesses can be more or less built in the exact same way or a very similar way.

13:18One will succeed and the other one will not. And it's a complete mystery as to why. And so you kind of essentially skip that process of trial and error to figure out what works and what doesn't. So that's one benefit. You're basically playing the shortcut key. I mean, this business here in particular, like it's only making 700-ish a month, but it's 13 years old. So I wouldn't be surprised if, you know, you dig into the history. It was probably once upon a time making a lot more than 700 a month for it to be that old. You know what I mean? Yeah. So that's one benefit. You know, you're shortcutting 13 years, essentially, of that.

13:53Yes. But perhaps a small price to pay for, you know, a decade plus of somebody else's effort there. The other thing, I mean, the thing that comes to mind specifically with this type of business is some kind of directory or lead gen angle for pest control companies where if I could build out that database of like, well, if you have a mouse problem in this area, you know, combine the pest plus location and then make a referral to such and such company. And there's more legwork involved with that in building relationships with the Orkin man or, you know, with the local service providers to come out and do that.

14:30But I think that would be another potential growth stream for a site like that. Very true. Very true. I will just say that directories are quite different from content sites like this one built on WordPress. But if your expertise is in directory sites, then absolutely. Like that could be your play. So it just depends on what your skills are, really. So yeah, one other thing I should point out is this is obviously not a recommendation to buy that business. No due diligence has been done. I just want to make that nice and clear. Don't go out and buy that business just because we've been looking at it.

15:01Up next, Joe pulls up a 23-year-old surf shop doing nearly five grand a month with a suspiciously low price tag. Coming up right after this. Big parenting milestone for us this month. I finally set up investing accounts for the kids. it had been on the to-do list for a while, but it was a chance to talk about the power of compound interest and making money without working for it directly. I think what was most exciting for them was the concept of owning a small piece of a ton of different businesses, and that a lot of the traffic on the road is people going to work for those companies, doing their small part to make them a little bit richer.

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16:18You know, when you're working for a company and payday just automatically happens every couple weeks, simple, reliable, easy, but now flip it. You're the boss. It's your business and you need to pay yourself and your team. That's where our partner Gusto comes in. Gusto is online payroll and benefits software built for small businesses. It's all in one remote friendly and incredibly easy to use so you can pay, hire, onboard, and support your team from anywhere. I've been on an automation kick this year so Gusto's automatic payroll tax filing is right up my alley. Plus you can set up simple direct deposits, health benefits, 401ks, you name it, Gusto makes it easy and affordable.

16:57There's no hidden fees, no surprises, and it's no wonder why half a million small businesses already trust Gusto for their payroll and HR needs. I want invites you to try Gusto today at gusto.com slash side hustle and get three months free when you run your first payroll. That's three months of free payroll at gusto.com slash side hustle. One more time, it's gusto.com slash side hustle. Do you have an e-com example or another one we should look at? Right. So this is another one that we were looking at. This one's making quite a bit more money when you look at the profit compared to the price. This is surf-store.com and it looks like they're selling water sports toys.

17:39Been around for over 20 years based in Slovenia, making close to$5 ,000 a month. Yes, that's right. So one thing that I noticed almost straight away is obviously this profit multiple is significantly less at 1.4x. So one and a half years and you'll make your money back essentially if it continues to make this amount. I typically see e-commerce stores selling for less than content stores, content sites. That's sort of starting to change. It's sort of evening out a little bit as to why it usually revolves around the style of the business. But I did look into this one a little bit ahead of the call and I could see that there's a couple of things to point out.

18:15So when you're browsing Flipper, you will see this revenue graph and it goes up to January and we're in August right now. So this hasn't been updated for a very long time, which means this graph here is probably very wrong. And so maybe the listing is several months old is the idea? The listing is probably quite old. And there's a big dip in revenue in December, January, but it's a water sports business. So that's not totally surprising, but you would want to see, well, what did 2026 year to date look like? Yes, exactly. And I would not be surprised if this particular seller doesn't respond because it's been on the market for so long.

18:52But I wouldn't be surprised also if you see the profit per month the last two months that were recorded were only$200,$400 a month. So something obviously happened around November, October, November, December in 2025. Yeah, are they holding physical inventory? Do they have a warehouse? There's more operational complexity surrounding selling physical products than just creating content on WordPress. Exactly, yes, 100%. So straight away, you've got a bunch of questions that you'd want to ask, especially if they're not listed in the description. Does it say if they're selling on Amazon or other marketplaces or only through the surfstore.com website?

19:30In most cases, it's only the surfstore. Okay. From my experience, it's very rare that you'll have, say, Amazon FBA, they call it, fulfilled by Amazon. It's not very common that you have a lot of overlap there. It does happen, but if it's built on Shopify, it probably won't. And if it doesn't specify, then it won't. Okay. Doesn't seem to in this case. So cool looking store, cool looking products, been around forever, decent historical data, at least as of 12 or eight months ago, but we'll see what the recent performance looks like. So some questions surrounding this one. And again, similar to if you've never run a content business before, I don't know, would you see people jumping right in and saying, I could be a great e-commerce entrepreneur if I only didn't have to come up with the idea and didn't have to start the business from scratch?

20:17It depends on what you're gravitating towards. I transparently have never operated a e-commerce store. However, I've brokered many of them and I know how they operate on the inside. That said, if you've had some experience selling things in the past and you'd like the concept of actually providing a product to a customer, because there is an appeal, I think, to actually providing a product of some sort. Yeah, in a way, it's easier to grasp because it's buy low, sell higher and go out and acquire customers. It's maybe simpler. Yeah. And profit margins obviously come into a play as well. So I like businesses that have high profit margins and e-commerce businesses typically have lower ones because you've got to purchase the products and potentially have to warehouse them.

21:01Although there are some businesses that are dropshipping, which is where the supplier ships directly from their warehouse to the customer. Those are a bit trickier. They're simpler, but they're trickier because they usually have a longer wait time to get those products. Yeah. And this one, shipping says international fulfillment model options for local slash EU warehouse and drop shipping. And so this is kind of the curious one. If I am looking at this and if I'm a water sports participant, like it says kite surfing, wind surfing, wing foiling, surfing, like if I am into that space. And I might look at this and be like, well, they don't have this brand or this supplier.

21:41And like immediately the bells start to go off and say, oh, I could add this supplier. I could expand geographically. It's like, well, if they're only selling to the EU, they're missing a huge section of the water sports market. Like what if we could expand and develop these relationships and maybe getting in at this price, you know, for a super established old domain, maybe that's a steal of a deal. Or maybe it's like, well, if I really want to get into it, maybe I just build that on my own. And if I'm going to have to drive paid traffic anyways, then why not just start from scratch? Cause I don't care about SEO.

22:13A hundred percent. Yeah. So you're thinking about it all the right way. And it really depends on the person listening's situation. Like, do you have another business? Do you have another side hustle that's currently going right now? And there may be some ways to potentially bolster those businesses. I like to call them bolt-ons. You get one business that's doing this thing and you bolt on this other thing and it becomes a much better business as a result of that yeah a very simple example could be say you have this website and you find a website that sells or that has a bunch of traffic from a surf store you could potentially buy that traffic essentially from the content or buy that content site and funnel a bunch of the traffic through to your store instead of amazon and generate a few sales that way or more sales that way that's just a simple example of some things that people do in order to bolster what they've currently got.

23:03Yeah, you got me thinking from a strategic acquisition standpoint of growing the email list, of expanding the body of content in one quick hit versus having to do a bunch of writing and research all on my own. Like maybe there's, and we've looked at a couple of these kind of some personal finance sites that are kind of on the downslope. They've been hit by algorithm updates or something. And it's like, oh, that would be kind of interesting. And one thing, I don't know if you do the same or recommend customers or clients do the same, was kind of plugging it in and all the information that you have about it into Claude or ChatGPT and kind of say, hey, given my situation and knowing what you know about this other business, like, what do you think?

23:46You know, just kind of starting the conversation of due diligence. It's not even due diligence. It's just like spitballing with an acquisition partner almost in the form of AI. Exactly. AI can be used to help verify a bunch of things. One of the things that we use it for, for our buy site clients, is we'll grab all of the information and put it into basically and prepare reports and things like that for the client. There are skills and stuff that you can create as well to help you do the due diligence once you've done it a few times. So I recommend like you can use AI to help bolster what you do or improve your system.

24:22It essentially gives you information, but just be really careful not to believe everything it says because it does sometimes give a bung advice. Like it'll say, no, I wouldn't recommend going for this one because of XYZ. And it reads very, it takes the numbers extremely seriously, which is a good thing because, you know, you want to verify everything, but that's just something to be aware of. The other benefit, usually, like your LLM of choice probably has a lot of information about you and probably your business as well. So using it to help you come up with potential ways or opportunities, fits that you haven't thought of with your current business would be something that you could also use it to help you with.

25:00Yeah, and I found it kind of tempered my enthusiasm a little bit. It was like, hey, here's a reality check. The thousand articles that you think you're acquiring, well, most of them don't meet your quality standards for these reasons. Only five of them are actually getting any kind of traffic. So you're paying for a lot of stuff that's probably never going to see the light of day. You know, it just kind of went through some of these reasons. There is no email database. It's like, oh, OK, maybe this is not what I thought it was going to be. So there is something like that. I was going to ask on this Surf-Store listing, asking price$83 ,000 is a pretty serious chunk of change.

25:39So there's some risk involved. But do you see people asking for seller financing or trying to get other creative financing deals done on these? Yeah, so there are a few options there. Typically, you start seeing seller financing start to be more of a talked about topic. I would say$50 ,000 plus. Just to explain seller financing for someone who's never heard of it before, It's basically just where you agree to purchase the business based on a set price. So let's just say 80K for this business. But you don't pay it all up front. You pay a percentage of it up front. So let's just say for easy math, 50 % up front.