Since I've never had a real job, people frequently ask me "What do you do?" What the they're secretly wondering is "How the F*#% do I make money??"
So I went ahead and made a tell-all video complete with numbers and examples.
Watch the video, but first:
1.) Grab a tasty beverage.
2.) Watch in full screen.
3.) Block out 15 minutes to watch in full. Enjoy!
Hey, Neville here. Whenever someone asks me, “Hey what do you do?” I always have to answer in like, “Oh I’ve got this little business House of Rave on the side and we’ve got this company AppSumo and I make these digital products and I sometimes do consulting.” And variably I kind of get this look of like: Huh!? So really what they are trying to ask me is, "how the fuck do I make money?"
Since I’ve never really had a job, it has been a little bit of a different journey. So I’d like to take you through the history of basically how I paid for stuff:
My first foray into making money was in middle school when I would download music, put them on CDs, and sell them and since not that many people had CD burners at the time I could charge maybe $20.00 to $25.00 per CD.
Was that illegal? Probably. I learned now to design websites and randomly someone would say, “Hey could you make a webpage for me?” And they would pay me a little bit of money and I would make a webpage.
Then starting in high school I used to stay after school with a bunch of other nerds and we would try all these like little money making schemes. I don’t know we were just fascinated by money somehow. We would do things like sign up on Yahoo stocks and like try to fake penny trade stocks and see if we could make money with that but none of us had money so we never did.
Then I made a website called Neville’s Cool Car Archive. Checkout the sweet graphic I had on the "Enter" page. (Remember when every website had an "Enter" page)?!?
I used to download cool pictures of cars and then Photoshop the backgrounds out so it was all black and just posted those online and, back then it used to get a lot of traffic and so I put some banners up and made $0.15 or something stupid like that. Then at the time there were all these ad networks that if you surf the web they would pay you like $0.10 per hour or something so we devised little schemes to make a bunch of different computers click on random things and tried to make money off of that; basically a bunch of stupid little money schemes.
But then in high school I realized maybe I should start like a more real business that could actually make money so the first one I actually started was called Houseofrave.com and it was a rave drop shipping company. This meant I sold light up and glow stuff online, but there was a supplier in California that had all the stuff and would ship it for me.
This was how the very first iteration of HouseOfRave looked like in 2001:
So whenever someone ordered a bunch of glow wire or glow sticks or glow necklaces or whatever it was I would send that order over to them and they would ship it out under House of Rave name.
Here I am boxing up a HouseOfRave package in San Carlos, California whilst visiting the supplier warehouse. It was the first package I physically sent out myself after running the business for 6 years!
That was one of my first real businesses and in high school and in college it actually started to making a little bit of money! So now every month I had a stream of money roughly $500 something plus dollars coming in every month and as a college student that is a lot of damn money! Once I started making that first dollar I kind of got addicted to the process of like, "Wow, you can actually make money with the business. This is amazing!" So I started this whole slew of small websites and little businesses; some worked, some didn’t. This included Resumite which I made resume websites for grad students and law students:
I made a little thing called Facebookprofile.com which was like a Facebook fan site where I posted ASCII art for Facebook wall pages before you could add images to someone's wall:
I did a rave forum to complement the rave business. I did some power washing of houses and things like that; WordPress design; putting Google AdSense on my blog and making $100 a month. I had some 3D printing websites where I’d post 3D printing news and put Google AdSense on that.
(I ran a 3D printing site called 3DPrintFactory for a short while starting in 2008. In 2013 I actually bought a 3d printer to play with)!
Basically I tried tons and tons of these different websites and businesses that made a little bit of money each and they all added up into a decent amount of money I can actually live on and since I was a cheap Indian kid I basically didn’t spend any money whatsoever through college so I saved it all.
So by the time I graduated college I actually had enough money to live on.....but now college was ending so that means you have to get a job right? Like, college ends --> then you get a job. Well I always found this a little bit weird because I had a lot of older friends who would tell me about their jobs and they didn’t seem like they liked them that much. In my head what I personally thought you got out of a job was one, you do the job to make money and then two you hopefully do the job because you are actually having fun at it.
What I found from real-life experience was most people if you took away the money part they would not do the job part so I was like okay so if you can make the money without doing the job, wouldn’t that be the same thing and a lot more fun?
So by the time college ended I had enough money saved up to where I could live for about two to three years without doing anything. So I thought let me give this entrepreneurship thing a try otherwise I’ll just go get a job. So, when I graduated college I had Houseofrave.com and a bunch of other websites that would make a little bit of money every month and then I started doing some consulting. So I was actually very good at getting a lot of my results to the top of Google; so that is called search engine optimization. S.E.O.:
....and at the time that was kind of like this emerging industry and there would be random people I would run into that would be like, "Wow my company is looking for something like that. Could you maybe help us out with it?"
When I started doing consulting they pay you a lot of money but the problem was it was BORING!! I did not like consulting all that much on boring businesses so companies would approach me and say….
(mocking a nerdy intonation in voice)
"Hi, could you get our business consulting services to the top of Google? We will pay you."
And I’m like….wow, you are paying a ridiculous amount of money for this; at the same time this is not very fun for me. So I quickly learned from a couple of those experiences that simply making money was actually not that fun if I wasn’t having fun doing it. So I wanted to do kind of my own thing.
So then I had all these little small businesses and it was time to get serious about them so naturally I turned to where the biggest source of information is....books!
I started reading all about marketing, about business process and all that kind of stuff obsessively every day and what I learned was I was spreading myself way too thin with all these small projects so I started focusing on kind of one thing. So House of Rave was focus and then I had a few other things like my blog which were a focus.
One of the things that always fascinated me because I wrote all of the time was copywriting, and copywriting is kind of the art of rearranging words to make something sell better. So you can have a page up on the internet that brings in one sale for every 100 customers:
.....but if you position it the correct way, it might bring in ten sales for every 100 customers meaning you have 10x’d your revenue off the exact same page and all you did was turn the words around?
I thought that was fascinating so I started obsessively reading everything I can about copywriting; Gary Halbert letters, Joseph Sugarman, David Ogilvy:
A lot of the ads behind me were written by or inspired by David Ogilvy:
These are all favorites of mine and I really, really was attracted to copywriting and so I started kind of practicing on my own writing on my own blog. I eventually applied some of the copywriting techniques to House of Rave with the help of some friends and low and behold it worked like crazy. So instead of sending a newsletter out and making $40 in profit, meanwhile the email service costs $80:
....but instead after the copywritten promotion I brought in $4,000 in a day.
So I was like wow, this…..what that, what, that really worked! So around this time I was pretty active on Nevblog which was my personal finance blog and people kept asking questions about House of Rave. They were fascinated that it has this news business that I only spent about an hour or two a day on, yet it brought me enough money to live on and then more and I had always discussed House of Rave and the things I was doing to improve it and so a lot of people kept asking the same questions over and over and over.
So I would do blog posts answering some of those questions but the problem is I was doing this for free and blog posts take a lot of time to take screen shots and write stuff out and edit it and all that kind of stuff. So at the same time my friends were always encouraging me like, "Dude you have kind of a little bit of a following on your blog, why don’t you make a product where you sell the information??"
For some reason in my head this didn't compute; like I couldn’t imagine charging for this information but then I realized, "Man, all these people really want to know this stuff. It is going to take me a lot of time and possibly some money to show them how to do this so let me try it out." So I made my first digital product which was about how House of Rave works.
It was just a 3 part video series going through the entire process of how I found which idea to pursue, how I built it, and how I ran it:
The idea was to show how a real business worked and you get to look inside someone else’s business. Most people have never seen inside of someone’s actual web business so they always think it is super hard like you have to have all these systems integrated.
Well mine was really ghetto.
Like my customer support team was just me with a Gmail account. Whenever someone called the phone number it was me picking up my cell phone. It was really that ghetto and people wanted to see that and it inspired a lot of people so I made my first digital product:
It took me about a month and I was very, very nervous about it and my good friend Noah Kagan asked me, he said, "What will make you happy on this?"
He was essentially asking me to benchmark what I would consider a "success" before releasing my very first digital product.
I said if I get 10 sales I would be really happy. I set the price at $37. I didn’t know how to price it; I just made up that number. One day I wrote a blog post and there was no pictures on it; no nothing and I put a PayPal button at the bottom.
Low and behold I got 27 sales the first day; so 27 x $37: something like $1,000. So basically I made roughing $1,000 that day and otherwise my blog was only making about $110 per month with Google AdSense and I hated seeing those ads on the side of my blog:
So now instead of having ads, I have product I can sell myself as much as I wanted, it made a lot more money and people were still getting a lot of value out of it rather than just clicking on my site some weird Google AdSense ad:
So with the success of that I started seeing that like wow, this kind of format of me making short videos followed by text is really, really helping people. I mean a lot of people got their businesses off of the ground after watching that short little video course and I just could not believe it!
So I finally started looking at myself as an educator like I have been all these years through my blog but I never wanted to admit that I liked kind of teaching people. So at this time I ran my blog, I ran House of Rave, I had a couple of other websites and I was also selling this product.
The product did pretty well and Noah Kagan my good friend who started AppSumo.com it was number 30 at Facebook. He was kind of building AppSumo off my couch. He would come over to my apartment and sit on the coach and we would just kind of work together and he was doing this little AppSumo thing. He had about 50,000 email subscribers. He was really good at doing that kind of stuff and he would send out these emails and I was on the email list and I would always get his emails and I would be like, “Dude, these are a joke, you don’t put any effort into them.” He actually hated sending out emails.
At the same time I was obsessively studying copywriting and copying out ads like and literally handwriting them. I was obsessive about it. I was like, “Dude, let me try sending out one of these emails to 50,000 people and let’s just see what happens.” So he gave me a good deal but it was a very specific deal about fonts called "Kernest" and I wrote this 3-page long thing with jokes and some pretty rough humor and like how to use it and how font designers….it was hilarious, offensive, and really effective. It was the most popular AppSumo deal by far and me and Noah were kind of like, wow, that worked way better than we thought it would!
So to make sure it wasn’t a fluke, I started writing the next email and the next email, and the next email. Low and behold AppSumo had this kind of like reputation for sending out these really interesting like, “Oh my god what are they going to say!” kind of emails and they converted like crazy.
So with the exposure from the AppSumo emails I also started getting consulting from copywriting. So I started taking on contracts for that occasionally. I was doing my own stuff. I was doing House of Rave and then I started doing this AppSumo stuff more and more and I found it to be really, really enjoyable; that is the stuff I liked the most.
So one day we were talking about putting that existing product about HouseOfRave on AppSumo but it was more about designing an eCommerce website and not that many people on the AppSumo website were really interested in that.
What they were interested in was seeing behind the scenes of a new business. So we positioned it like that and released it and I didn’t know what was going to happen. I thought maybe I would make a couple of sales.
....but what do you know; it was the best-selling deal on AppSumo history! So that was very encouraging (and it made a lot of money). Giggity.
At the same time I was really interested in this copywriting stuff so I kept talking about it with people and people kept saying wow this is amazing, what do we do, how do we do it blah, blah, blah. So I was like well I made this other course that was really effective for people and it made me a lot of money so it is kind of a win-win so let me make another one.
So I made the original Copywriting Course:
The Copywriting Course we sold it through AppSumo once again and it was a huge success; people loved it. Then Noah wrote a post on the FourHourWorkWeek about how to validate businesses in a small way and I had been doing this stuff for years just started very small and then if it did well, investing more money. So he did a post about this and it was a really big success on the FourHourWorkWeek, Tim Ferris’s site. So we made a product called the Sumo Business Blueprint that taught people pretty much the exact method step-by-step and we showed them how to do it:
Once again, that was a huge success. So I started noticing a trend like okay I’m having a lot of fun making these products; the products are making a lot of money and they are helping a lot of people; like this is win-win-win. There’s no drawback over here.
So I started making products left and right and about every month I was putting out a new product so I had a behind the scenes course, I had the Copywriting Course, The Sumo Business Blueprint, The Sumo Diet Kourse; which flopped; Social Krash Kourse which flopped; Course About Building A Course because people wanted to see how I was building all these courses. Then I did the autoresponder course, Copywriting Course part two, Sumo Business Blueprint part two, The Craigslist course, Problem Solving Checklist; yada, yada, yada. I made about 11-12 products of my own in about 1 or 1 1/2 years:
I also helped to produce a bunch of other products for other people also.
So on the making money front I was making money through my blog, I was making money through House of Rave, I was making money through contracting with AppSumo, even though I owned a small part of the company I take no salary so I would bill for whatever I did and I would also get residuals on all the stuff I sold so every time people buy something I would get a percentage of that sale and AppSumo gets a percentage of that sale. So every day regardless of whether I woke up or not; I would actually make money from the sales of these products. Then after a while the AppSumo business model started to change a little bit and we moved from being a marketplace to more of a one-time deal model.
So I started selling a lot of my products on my own. So an example is The Problem Solving Checklist (you can see the whole thing for free at that link).
It was the smallest product I ever made. It took me about 1-1/2 weeks to make and I sold it through AppSumo and then I sold it on my own. I did this with a lot of other products also.
So let’s break it down. Well, all those products I talked about, they are still on AppSumo and selling on my own so every time I sell one of those, I get money. Whenever I sell them on my own, I get 100% of the money and whenever I sell them on AppSumo I take 35% of it as profit. Consulting; whenever someone wants some help with their website or they need me to write something for them, I will take that contract and bill them out by the day; so they get access to me for a whole day and if they want more days they can buy them. Then I help them redesign their website, tell them to do this, add some testimonials here, rewrite some things, talk about their business; that’s another way.
I sell all my products on my own of course so off my blog I make money too and I still own House of Rave but someone else in Colorado runs it and is buying it from me over the course of about 21 months so every month I get a check and then whenever I create a new course or something to sell I can email it to my list or to AppSumo or to whoever is interested and they will buy that and I get money. So that’s how I make money but I know the real question you are asking is how much money? Everyone kind of wants to know that in the back of their head but they are kind of too shy to ask. Well I’m usually really open about money so I’ll tell you, last year the lowest I made was about $12,000 in a month and the highest I’ve made was about $52,000 in a month and on a normal month it was somewhere in between right there. So that’s how I make money. That’s what I do and it will always continue to evolve.
So like I said in the beginning I always felt the purpose of getting a job was one to make some money and then two to have fun doing it but if you can make the money without the job, then wouldn’t that be kind of nice too? So that’s the path I chose to take. Now is it always going to be stable? Probably not but neither is a job so with that said that is how I make money and that’s how I am going to continue doing it.