Welcome to my income report – includes earnings online since 2005
Every month I will be sharing a detailed look at what I have been doing and how that has been translating into the bottom line.
To be honest I find this process way outside of my comfort zone, but I feel it is important for the following reasons:
1. So you can see what works and what doesn’t. More importantly I want to dig deeper and share my lessons from the past ten years and show you what works now.
2. I want to inspire you to take action to build your own online income because I know it can enable a phenomenal lifestyle.
3. Purely selfish reasons: Sure I have made some money online, but I missed being part of a community. I love helping and seeing others succeed. Before starting my own online adventure, I was fortunate enough to help others get their dream job and I got paid a commission every time I succeeded. My plan for Cubicle Free is to experience that feeling again. But this time there will be one key difference – I will be helping people become their own successful boss.
Since this is my first report, I want to take a step back and give you some background:
In 2000 at the age of 29 I fired my boss. At the time I was working for a recruitment agency in London, England earning the equivalent of six figures. We had just been taken over by another company and after three years of putting my heart and soul into the business and being instrumental in taking it from unprofitable to takeover target, I watched it make my boss into a very rich man. Meanwhile my desire to work for myself was growing. As a recruitment consultant I had shown myself that I could build a business. So despite being offered a sweet position in the new company I decided I would never work for anyone else again (or at least give it a damn good go).
In March 2000 my girlfriend (now wife) and I packed our bags, left England and travelled for the next six months. Among other adventures, we trekked in Nepal and spent weeks on our own island paradise in the Philippines. After a few months of travel I began working on my plan to leave wage slavery far behind.
Later that year my wife and I started my business in Sydney Australia. The plan I hatched beachside in the Philippines was to help send candidates from Australia to the UK to work in engineering, town panning and construction jobs, which at the time suffered from a serious shortage of experienced professionals.
The business model was pretty simple – basically I charged UK recruitment companies a fixed fee for every successful placement they made.
I hate to think of the hourly rate but we made enough money to live on the Sydney harbour waterfront in a studio apartment. Life was good. Back then we were doing everything manually. Seems hard to believe now but before Google even existed, newspaper ads were still pretty effective. We would email and call every suitable applicant and to ensure things ran smoothly we also made many late night phone calls to the UK.
In 2003, I started building my first website on a free platform. By then my wife had decided to pursue a career outside the business. The site was pretty basic (pathetic would be another way to put it), but I knew the potential for a content rich website that attracted candidates and then automatically directing them to the recruitment companies that needed their expertise. It took several years but in 2005 I finally re-launched Workgateways.com. The site was much improved with an information focus and a database that effectively automated all the candidate selection parts I had been doing manually. After a successful launch I converted my clients from a success based model to a monthly subscription based on 6 or 12 month agreements.
Here is what happened to the income:
2005 – $126 932
2006 – $247 225
2007 – $308 104
2008 – $390 829
In 2008 the recession hit the UK jobs market like a sledge hammer. Nobody was hiring. The lucrative recruitment business I was growing basically evaporated before my eyes and building or even retaining this business was like selling ash-trays for motorbikes.
2009 – $255 719
At times, it seemed like everything I had worked for was ending but like many people I hoped the tide would turn. For well over a year I kept thinking maybe I could resume business as usual sometime soon.
2010 – $113 022
As we all know now, the tide did not turn. Fortunately before the recession (and even before 4 hour workweek) I started focusing on the passive income component of the business. I could see the potential and in 2011 my passive income eclipsed my active income.
2011 – $95 465
Then in February 2011 Panda hit and I lost 50% of my traffic instantly. I regained half of the original traffic lost by October 2011.
Then in April 2012 Penguin hit and I lost 50% of my remaining traffic.
Which brings us to today.
Traffic is at about 20% of what it was just over a year ago which means my original website is basically dying. I tell you this because I do want to clearly show what Google can give and just as quickly takeaway.
This brings me to a very important point: I am on a mission to help others build online income but do it safely for the long term. For over a year now I have been studying what works and what doesnt online and almost everywhere I see very risky link building practices. Sure these link building plans might work for now, but I am not placing my livelihood on them and I don’t think you should either.
Here is what Matt Cutts (the head of Spam at Google) tweeted recently:
My advice – Don’t do what everyone else does with regards to link-building. I believe this is what has hurt my business. For example, just a few years ago swapping links using the same anchor text was considered good practice and it was what everybody else was doing. I did it too, and I believe it is one reason I got hammered.
Today the anti-spam algorithms are looking for footprints, its just a question of whats next. Fortunately there is a very simple way to avoid doing what everybody else is doing: simply build great sites that really help people. Sites such as these attract natural, organic links and everyone is happy. That is what I will be focusing on and what I think will work best for you too.
Without further delay, here are my earnings for August 2012
Workgateways.com
Income = $3487
This site is where it all started and is also at least 95% of my online income to date. I still love what this site does and it still makes a little income. Just last week I got this testimonial on Facebook:
I find it very rewarding that people still get a lot out of the site (which was the reason I built it in the first place) but also disheartening that Google doesn’t seem to like it anymore. Unfortunately without significant improvements in search traffic, revenue will decline further. I wont go into details on this post, but clearly it is time to diversify and build new sites.
Jobaroo.com
Jobaroo is a project I started a few years ago. It is basically modelled after Workgateways except the focus is for travellers going to Australia instead of the UK.
In April this year its traffic was hit by Panda (version 3.5).
Income = $515
New Site
I just launched a site two weeks ago and today I found out it has just made its first affiliate sale. wooohoooo! The way I am building this site represents the way I think sites should be built post Panda and Penguin. I am keeping track of my hours spent on everything and I look forward to sharing this with you in the future.
Affiliate Income = $10
Grand Total Income = $4012
I have to tell you I find this final total NOT awesome but I am also proud of what I have built in the past. These totals do not include expenses either, although they are pretty minimal.
Given that this is my worst month in the past ten years and a fraction of earnings just a few years ago I am sure you will agree there is a lot of upside from here. I have only really just begun my journey back to making good money. Apart from studying what works best online I have basically taken the last year off.
New Focus
In the past I have always focused on peoples needs and then built sites that met these needs. I found this can generate fantastic income so I will not be changing that. The big difference this time is that I will be building a series of much smaller sites (diversification) and developing a system that I can replicate. I will also be sharing everything here. At present, I am designing a marketing program with my goal to build traffic quickly (so far so good) but ultimately I want a business that will stand the test of time. If you have any questions or comments I would love to hear from you.
Thank you for reading! If you would like to join me on my quest to get or remain cubicle free, join my email list at the top of this page. I promise to only send you the best of what works online.
Joseph Archibald says
Quinn, fascinating! Can’t say I’m in the same leagues as you where it comes to loss of income due to Google changes, but I sure do know how it feels to take one hit after the other (hence the current freelance writing career change). The time for change is now – I wish you well!!
Joseph
cubiclefree says
Thanks for commenting Joseph. Looking forward to seeing you doing really well again too man! To be honest right now when I look back it was actually a blessing in disguise. Even when my clients were leaving in droves during the recession I knew that somehow things would end up better but I have to admit I could not for the life of me immediately see the positive side. Now I do and the view is way better than I thought possible.
Could it be that we are just having good lives?
Financial Samurai says
Wow, that is AWESOME you made $390,000 in 2008! $250,000 in 2009 was still pretty good.
Do you think you can ever get back to around $15,000-$20,000 a month online?
Sam
cubiclefree says
Hi Sam, You know what interestingly when I was making $390k or so per year, I thought I had a long way to go. I guess it’s not the money that does it for me – I really need to have something deeper that I am trying to achieve. Got no doubt I can get back to $15-$20k/month. Whats more I truly believe anyone can do it.
Financial Samurai says
Hey, I’m back to this comment/report! I forget sometimes what I’ve written and didn’t connect 390K with 400K.
May I ask you some straight up questions?
* When you say you had a long way to go, were you thinking “sky is the limit” $1 million here I come or something like that?
* It concerns me that Google can take away 80% of your traffic JUST LIKE THAT. Thank you for your transparency btw. Was there any one or two things you did that you think hurt your site? It just seems UNJUST they could do that unless something else was going on.
* Do you think I should be afraid? I have literally done ZERO link building since July 2009, probably b/c I don’t know how to do it! I don’t even participate in carnivals b/c I was REJECTED from my very first one! All I do is the occasional guest post, which is like once a quarter, maybe.
* I’m trying my hand at affiliate income this year on FS and am trying to be totally transparent and as opinionated as always e.g. “Who Should Get A Black Card? Probably NOT You!” Do you think having too many no follow affiliate links is bad? Do you have a recommendation as to how many per post is too many? I figure if I can provide an awesome product that solves a reader’s problem, why not?
Thanks for your thoughts!
Sam
cubiclefree says
Great Questions – Thanks!
– My goal at the time was to sell for 10M, I was going for a multiple of 4 which meant I had to get to about 2.5M in income. I thought that was attainable at the time.
– Swapping links and over optimization were two practices that I worked at. These practices were considered very legitimate and by many to be best practice at the time. Google used to reward websites who did this.
– I think everybody should focus on natural organic link building only and nothing that is overly manufactured. I am not sure what SEO you are doing on the sites themselves but if it is natural and written for people not machines you will be OK. Heavy keyword focused sites are more likely to get targeted because Google can see you are playing the game. I do not think you should be afraid. Guest posting is not spammy although I would vary the anchor text each time so it is more natural. If you focus on the individuals who come to your site and give them a great experience you will A) Make more money even with lower traffic AND B) Google will send you lots of traffic as well.
– Do you think having too many no follow affiliate links is bad?
– Do you have a recommendation as to how many per post is too many?
I do not know the ratio Google has set and that may change anyway but in general if you are helping people it will be fine. If your sole purpose is to deliver people to your affiliate links – what value have you added? Google is looking for useless websites and will not like that. For example an affiliate link or two on some pages is absolutely fine if it makes sense for your visitors.
– I figure if I can provide an awesome product that solves a reader’s problem, why not?
Absolutely – Sounds like an awesome idea.
Really hope my answers make sense. Google just wants to people to use its search engine (so that people clicks their ads) and it is doing that by providing the best results as possible. The future is bright for online business that focus on real needs and can monetize that. If you are useful and add value you will do well as an individual and as a business.
Feel free to follow up with more questions Sam. We are touching on some very important points here. Thanks for asking.
Quinn
Sam says
Thanks for your thoughts Quinn!
It’s weird that Google would approve of your methods and then say no and punish sites. Does that make sense? It doesn’t to me. So what is Google saying now?
I’m impressed you were thinking of going from 400,000 to 2.5 million. I would sell for $10 million if I had a chance. Do you think people should be buying websites now or selling websites. It seems that in this low interest-rate environment it’s better to be buying cash flow producing assets not selling.
Why do you think more people don’t go online to try to make money if it seems so easy. The per capita GDP in America is on my 50,000 per household. That’s a low hurdle to jump over for online income especially since you’ve proven you done almost 400,000.
cubiclefree says
I think what happened with Google is that too many people were gaming the system so they had to get tough. In the process of getting tough they applied some pretty harsh and overly simplistic measures to weed out the spam. They were highly effective at weeding out the spam but unfortunately many legitimate sites got hammered too. No point in worrying about it, just got to play by the new rules. Going forward it means that if you want to do well it is much more important that you build useful websites and if possible get your traffic from sources other then Google – think youtube, podcasting and networking. I think it is a good thing longer term and all the spammy websites that got wiped out have left a big hole of opportunity.
Don’t really have an opinion on buying or selling websites – mostly because I do not have experience with either. I think most people should be building websites and forget about all the other shiny things. Keep it simple, keep it profitable.
I honestly don’t know why a lot more people don’t go into business online. I have found that making money online is not easy but it does set you up for a pretty sweet lifestyle. The lifestyle of your choosing.
50k is highly achievable and if you can do 50 you can do 100 …. baby steps.
Financial Samurai says
Quinn,
One thing I forgot to ask. With $390,000 in income, and 3 other partners costing $50,000, how did you manage to keep your partners inline and NOT share in the bigger pie? $50,000 / 3 = $16,700 each that year in profit while you took down $340,000 or so pre tax. Did they not get a little envious of you earning 20X more than each?
S
cubiclefree says
Hi Sam,
Sorry not to respond earlier to this one. I got caught up on our other conversations and totally missed it! My 3 partners were outsourced contractors so there was no need to share anything. I paid them really well and always gave (unexpected) bonuses at the end of the year – in one ladies case this was a couple thousand dollars.
In her case she had a full time job and the work she did for me was a pleasure for her – she was actually doing it for free on the forum and I offered to pay her for that and helping me with other parts of the business. She worked for me for many years and only stopped when Google pulled the rug from under us. We remain great friends.
Quinn
Financial Samurai says
Good stuff Quinn. Yeah, I’m always a little hesitant/worried when money comes between people I know. If there is a set agreement, some still might feel unsettled. Good you got contracts who did well for you!
backlinks says
You really make it seem so easy with your presentation
but I find this topic to be actually something which I think I
would never understand. It seems too complex and extremely broad for me.
I am looking forward for your next post, I will try to get the hang of it!