What would you do with $500k if you're starting from scratch?

[dennis_max]

I've been in the digital marketing space for more than 15 years with different level of success: white/gray/black hat marketing:

From boosting reddit posts to the front page, to getting a ton of traffic on Instagram by abusing mentions in comments, to legit authority sites and e-learning platforms.

Recently sold a bunch of online assets and made a lot of money but quickly became bored. Everyone is dreaming about retirement, but it feels terrible to me. I'm in my 30ies, have enough money until I die but after a few months of "vacation" and doing nothing I just got bored really quick.

Just decided to get back in game, and will make sure to make a few posts in the laboratory, however I'd like to hear your thoughts on what would you do in the space if you had extra $500k to play around?

Ideally, I want to make sure I'm diversifying my traffic sources: from early in my career I've had the mentality of hitting it hard while it lasted (insta/FB abuse, Google algorithms, etc.) but now I want to build something that could work for the next 10 years, which means it can't rely on one source of traffic: has to be a combination of organic (website, newsletter and YouTube), social (FB, insta, TikTok), paid (Google/Meta ads) and probably a way to monetize via ads/ecommerce store/paid newsletters/infoproducts, etc.

And then when I'm thinking about all of it I start getting anxiety of finding a big enough niche that can support all of those initiatives.

How would you approach the selection process of the niche and monetization strategy in this case?

 

[bernard]

If you want, you could try your luck at being a guru, go on the podcast and youtube tour and go build an audience on Twitter.

You could also do like Neil Patel and invest in some tool, go talk with people here perhaps.

I would definitely not invest in a typical content site though.

 

[CCarter]

If you are bored buy a business that's already got revenue and scale it: BizBuySell

If you really want to do something online, find an operation that has a weak online presence which you think you can scale with your skills.

It's easier to buy revenue than generate it.

 

[Smith]

I'd look at one of the following:

First option...

a) I'd pick up an offline business that has an owner ready to retire and is primed for online expansion, ideally in an industry where I could keep buying up smaller competitors and easily fold them in as the business grows.

I'd ideally look for something within a credit system (e.g. USA) that has hard assets (e.g. real estate) so you can either buy bigger than your budget allows through bank financing (so you can unlock more revenue immediately) or allow you to turn around and unlock more capital for aggressive expansion through easy bank financing against the assets you bought.

Second option...

b) I'd look at pulling a Tai Lopez and buying an old brick-and-mortar brand that is collapsing under its own weight for pennies on the dollar... hard to say what you could pick up at that price point, but if you throw bank financing into the mix your 500k can become 2.5mm if you use it as a 20% downpayment. Then hire a firm to sell off all the parts as fast as possible, cancel all outstanding financial obligations, and find a way to leverage the brand and turn it into an online cash machine.

 

[secretagentdad]

If you're just looking to stay busy start a restaurant.

 

[contract]

Just because you have $500K doesn't mean you have to spend it.

Such a big problem for those who create wealth; they have this money just burning a hole in their pocket.

I used to browse local biz sales all the time, trying to find something, anything.. I couldn't live with $$$ in the bank just chilling. Stocks were boring even if the return was acceptable. But 90% were selling out of desperation/slow failure; too much of a hassle at the end of the day.

Put your money to work for you, but be wise and patient. I must have investigated 50+ local businesses in person only to find out the truth. Had I bought some during COVID, I would have been absolutely screwed. Others would have sucked up all my time, I would have been miserable dealing with that. Have to think for the LONG term when buying.

 

[Smith]

Just because you have $500K doesn't mean you have to spend it.

I agree... but doing nothing also comes with risks. So what do you do with it instead? Inflation will eat away at it if you leave it in cash... would you stick it in treasuries, an index fund, CDs, or something else?

 

[DoItNow]

How would you approach the selection process of the niche and monetization strategy in this case?

In your position where you have the money you need but want to keep yourself and your brain active (and ideally happy and not too stressed), I'd start by thinking about 1) what niche topics actually excite and interest me? Maybe something like a sport or hobby or activity or etc that you already like to do and might like even better if your expenditures for it are tax-deductible business expenses for your website.

Then I'd 2) look at traffic and monetization options, and ask myself which subsets of the categories that you mentioned might work well with your idea? Is, in fact, your niche big enough, and if not, how do you expand it? Keeping in mind that what works now will most likely change again and again going forward, so you don't want to have just one set path.

Next, I'd 3) look at the competition, and think about what I could offer that they don't. Come up with unique twist.

Finally, I'd 4) test it out by developing a small site, and 5) assess whether you think you'll enjoy it. Maybe come up with 2-4 possible ideas and test each one. Because life is short, and if you already have the money you need, why not have fun with your next project?

Meanwhile, in case you haven't already done this, I'd shift most of that $500k into something like a 5% short term money market or cd until you need it - either something that's short term, or ladder it. And as someone else said, just because you have $500k doesn't mean you need to invest all of it into a new business, either right away or ever. Start small, grow the business, and see how it does.