Business Innovators Radio - Interview with Matt Raad Co-Founder of eBusiness Institute

Episode Date: January 17, 2025

Matt Raad has used a very unconventional method to create financial freedom in his lifetime, starting with nothing and building a high cash flow portfolio through buying and selling businesses.He and his wife Liz are website investors, which means they use digital assets to generate cashflow and build wealth. They were one of the first in the world to realise that they could buy websites, renovate them like real estate, and then sell or keep them for cashflow.Matt started out as a zoologist with his wife Liz, buying their first business, expanded into multi-million dollar mergers & acquisitions and then transitioned to investing in online businesses where the cashflow returns were so much better.These days they love teaching beginners how to reach 6 & 7 figure website portfolios using a similar strategy to buying & renovating traditional real estate.Learn more: http://www.ebusinessinstitute.com.au/Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-matt-raad-co-founder-of-ebusiness-institute

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of Influential Entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have with us Matt Rod, who's the co-founder of E-Business Institute. Matt, welcome to the program. Thanks for having me on, Mike. Great to be here.

Hey, I want to learn all about what you do and how you do it, why you do it and who you do it for. But get us started first with a little bit of your story, your background, and how did you get into this industry? Well, I guess I've got a little bit of a unique background in that we've made our, well, our financial freedom through buying and selling online businesses. And I think maybe like a lot of your listeners, we, you know, many years ago, we love the idea of, you know, passive income. And we read, you know, rich dad, poor dad, and we're looking for leverage on our time. And we realized business is the way to do it. And we started buying traditional bricks and mortar businesses and we're very successful at that. We absolutely loved it. But we, when our kids came along, we really wanted to free up time for ourselves. And we really wanted,

I guess that, yeah, time freedom and for me, financial freedom and online businesses were just so easy. So we're also, I should mention, you can probably hear in my accent, we're located in Australia. And in our bricks and mortar business world, we've been exporting to America. And we realized one of really interesting things, Mike, for us, this was back in 2008. It's very difficult exporting when you're on the other side of the world. But with online businesses, we suddenly had access to the American market literally within, you know, hours. And that was exciting. So we could go to bed, wake up in the morning and have the dream scenario of money. in the bank account. So it was like heaven on earth for us. So when you say buying online businesses,

is that tip, you know, like you hear business brokers who, you know, like someone started a mom and pop shoe store. Now they want to sell it. So a business broker would sell that store. Someone would buy it and run it. You're talking about people that have built an online business with a website, e-commerce, sales funnels, the whole shot, and now they are looking to sell that business, and that's what you're looking at, not necessarily buying and selling a website that might not do anything. You're talking about a full-on online business, right? Yes, yeah, that's right.

And really interesting. When our background, we initially made our money through buying and selling wholesale import businesses and manufacturing businesses, so bricks and mortar. So when we got online, we actually avoid e-commerce websites. So we buy any online business at all except for e-commerce because it involves physical inventory because as young entrepreneurs, it really held us back. And anyone listening to this, you're going to be blunt about it. If you're a beginner, I wouldn't buy an e-commerce website unless you really know what

you're doing. Because it involves tangible items. You've got to store them. You've got to put them in a warehouse. You've got to touch them and ship them and cardboard boxes. Yeah, got it. And especially these days, you know, you've got to do with China. And that's challenging, I'll tell you now, like being there done it.

And it's really difficult. Or ordering stock from China, holding in a warehouse. So we do none of that. We buy basically non-tangible, like sites that have advertising, affiliate offers or sell courses or information products. Or they sell leads to local businesses. We absolutely love all to businesses. So basically we just want sites that on the monetization side, totally automated.

And just, I mean, I've never, you know, spoken to you before, never seen your website, but I'm hearing what you're describing. And I would venture to say that there's another type of site or business that you would also not buy. And I'm just kind of testing my cognition here. So you hear about all these coaches and gurus out there. If they built a business and they're the face of the business and it takes their intellectual capital intellectual property to run that because they're doing the coaching, they're doing the delivery, that would probably be a harder business to buy and run because now that guru is not part of the business anymore, right? True. Here's an interesting thing.

True. Like as a beginner, you probably wouldn't buy those. but those sorts of businesses can. So the market's evolved. It's really interesting. We actually see this with, I can go slightly sideways with that. One of the new trends that's really popular with big buyers. We're talking seven and eight figure deals.

These are in the millions. Food blocks run by, in inverted commas, you know, they become personalities. And you would think the same thing with those. But you can actually transfer a business, no matter what kind it is, if it revolves around the previous owner, if you stage the exit. So we used to do that at bricks and mortar businesses as well. But what you're saying is exactly right online. It is particularly, there's another level to it.

We need to be a lot more careful. And basically what you do is you come in is kind of like a part owner and you would stage it out. As long as the person's selling works with you for six months, say, to bring you in as the expert in inverted commas and then gently weave you in. But what you've picked up on, Mike, is one of those more trickier situations, which is, food blogs are one thing run by an inverted comma, famous food blogger. But a coach, yes, that is starting to get tricky because there is IP there.

It does happen. If you're a coach listening to this, and you want to. exit your business because like Mike said it's it is pretty difficult to sell a coaching business what you need to be doing is thinking a year or two out and start systemizing the business so that it doesn't revolve around you as much don't worry if it revolves around your name that's absolutely fine it's more just that a buyer can see they can come in and take it over so there's always a way to do to do those sorts of exits but yeah i agree coaching businesses are a little bit trickier to for us to buy or sell.

But actually, I do look at them, though, because sometimes coaches will just, they might get sick of their business for whatever reason, we want to sell them cheaply. And if there's good assets there, so with a website, there's more assets than just the branding of the individual behind the website. So, for instance, traffic these days or the tribe or the community is hugely valuable. It is massive. Well, that coach or that guru or that consultant, they might want to step away from the day to day and just want to stick.

be the face of the brand and do one day of work a month and let the new owner do all of the, you know, pushing of the buttons and handling the business. And so I've heard the concept exit without exiting. They might not want to fully sell and wait six months to get the full payout to make sure the business delivers X, Y, and Z metric. They might want to still be part of the business one day a month, just guiding strategy. and then let the new owner run with it and do all the email answering and the sales funnel. So there's all those kind of things that can be considered.

But at what point did you say, you know what? I don't want to just buy and sell websites. I want to buy and sell online businesses and turn profits. What made you think that that is a viable strategy? Really good question. Well, I guess it's the lead up to it. We were always fascinated by business. Our first business was a manufacturing business,

and we were addicted within seriously less than 48 hours. We suddenly realized this is awesome. So our journey went for 15, nearly 20 years before we got into the online stuff. We started young with that business, and we bought and sold other businesses. And what we were doing, we were always looking for the perfect business model. And we hung around, because we were totally new to business, business and always have been, we made a point when we're younger to hang around mentors like

guys that own much bigger websites, very successful, millionaires. And I grew up on a farm, as did my wife, and we knew no millionaires, but through business, we got to meet them through networking. And what we were doing, we were always looking for that perfect business model where we could live back in the country on the farm and then have time freedom. That was really important for Liz, my wife. So when we come to raising our kids, she could be. your mum and everything like that. And over the years, we also got involved. We became mergers and acquisitions, specialists and brokers,

and we were doing deals up to around 20 million. So we were learning a lot. And when we started to see the internet in the early 2000s, it was actually Liz that picked up on it and said, hey, Matt, you know, if you get a successful online business going, there's no barriers for us to go to America, which is the biggest market in the world. back then 300 million people.

It works 24-7 and it's massively leveraged. If we get a winning one, we just put a bit more money into it and we can really skyrocket it without having to put capital in and buying physical inventory because we've always owned businesses with physical inventory. You can hear I don't like it, can't you, Mike? That's where all our net worth was always tied up. All of a sudden we realized, okay, with internet businesses,

we have none of that and we can work from home. and we can work in the evenings in our pajamas. No one's going to see us. We don't have to do it with any clients. So it ticked literally every box we had for the dream business. And to this day, I still, after all the hundreds or thousands of businesses that we've seen, all our friends are into buying and selling businesses, this is pretty much our life has been for the last 30 years.

I can honestly say to this day, I'm still not seen a better business model. It is for beginners, intermediates, and advanced people. I absolutely love the online space for all those reasons I just said. And so to us, it was kind of a no-brainer. Yeah, and it sounds similar, and I know you, this is one of the things you talk about, but it sounds similar to real estate investing where you could buy and hold. You could buy and rent out. You could buy and fix and flip.

So talk a little bit about some of the best models. So for instance, you might find here's this online business for sale. It's in whatever industry. And man, this would be spectacular because it is high value, but it's a fire sale. The owner just needs to get rid of it. You can get it for a wonderful deal. And you can list it immediately and make an instant profit of X. That could be the model of fix or like just a buy and flip.

But a fix and flip model could be here's a business. You know what? We've analyzed it. And boy, if you spent six months just polishing up this aspect, that aspect, this aspect, then you could put a bigger price tag on it and sell it and make a big profit. What are some of those approaches that you teach your students? Yeah, that is it in a nutshell, Mike. And funny, we used to get asked to speak.

When people started hearing what we were doing, it was quite unique back in 2010. We used to get asked to speak at real estate conferences because it is very similar to real estate. And here in Australia, I know it's the same in America. Here in Australia, traditionally real estate is how people generate. significant wealth semi-passively. And I guess you hit the nail on the head. We're doing exactly the same thing. And we tend to be buy and hold.

So we're more like Warren Buffett. We treated these as businesses. And we held them for the cash flow. But you can certainly flip websites. It's a very well-known concept. But in essence, I can give you some great examples. What we look for is bargain sites. So you think of all that there's actually, what is it,

I think there's something like three or four billion websites on the planet, and at any one time apparently one and a half billion are active. That's billion with a B. So you think of all those websites that are out there, there's always someone that's put lots of effort into setting up a website, run it for quite a few years, and then they get sick of it, or they don't know how to make money out of it,

and they just sell it off cheap. That's what you want. And so a great example, and people are surprised by the sorts of niches we go into, but two of our clients, You're lovely young couple. They do this for a living now. They live off a laptop, Nathan and Alexa.

They're travelling around the world. They own a portfolio of these sorts of websites. And they noticed a website here in Australia all about native Australian gardening. Now, these two couple, they don't know anything about gardening themselves. They live on a laptop. They live in Thailand. They live in different countries around the world. But they noticed he had done no work on it, but it was 14 years old.

And so they just sent him an email and said, hey, mate, notice you're not doing anything with your website, are you interested in selling? And he said, sure, I'm over it. It doesn't make me any money. He sold that asset to them for $400. Okay? And we've just come out of spring,

and it already had existing traffic. People were interested in Australian Native Gardens. That thing now gets over 80,000 visitors a month because they've renovated it. We call it renovating, like you do with real estate. You do a makeover. then you do a renovation, so you add in more content, and they hire, they outsource all of that.

You'd go to Upwork, a website called Upwork.com, find writers, expert writers, and they add to it. So Nathan Alexa don't write for it. And that site now makes them four grand a month net. Wow. So 10 X their investment. 10 X amount. Now, I want to point out that was not a get rich quick thing. That's taken them two years, around two years.

do that. And so what they're doing, they own, I think, currently. So they, they, you kind of, when you own a portfolio site, you kind of sell off your smaller ones and you focus on your bigger winners. They, they, they would own around currently at the moment five or six good money making websites. They're around that level. So you're talking a significant income. And can I share one more really powerful example? Because we know a lot, and I think a lot of your listeners, you know, If you're into travel, Mike, do you reckon some of your listeners are into traveling? I would think so. Well, you know, you can buy travel blogs, and of course there's some big advantage of that.

It then pays for all your travels. But we have another lady on our course. She bought, she's a, she retired. And here in Australia, it's like you guys, you know, you go RVing around America. I think that's what you guys call it. Here they're called gray nomads, so retirees traveling around in a caravan. And she was in a private. Facebook group and full of people that do this. And someone put up a post saying, hey, we're retired.

We've been running this online blog about our travels around Australia for the last, I don't know, 10, 15 years. Does anyone want to buy it off us? And not a single person recognize the value of that. You know, this is a 10-year-old travel blog with real content about real places visited. lots and lots of people. There was over 150,000 people on the private Facebook group that came with it. And so Annette sent her an email and said, hey, I'd be interested, and she bought it for $5,000. Like, you think of all the work that would have gone into that website. The seller was happy because they weren't going to do anything more with it.

That's the sort of bargains we're talking about. And that site now makes around $4,000 to $5,000 a month. Is it life-changing amounts of money? No, but if you own three of those, and you're a retiree, that's a nice lifestyle. That's net profit, by the way. So she renovated it, puts affiliate offers on, and all she has to do is as she's traveling around,

she just keeps the site updated. It's kind of like a makeover with real estate, you know, coat of paint, and then just keeping it maintained, posting a bit of content, interacting with the people on the Facebook page, stuff that she loves doing. It's not truly 100% passive, but it's semi-passive. But it's a very valuable asset because there's so much traffic. So travel niche, we have a lot of clients in our community that absolutely love the travel niche because they love traveling.

It pays for their travel and they can make money while I travel as full-time bloggers. And those examples you gave were websites built, well established and not really doing much. Talk a little bit about an example that you can remember where here's a website business that's functioning up and running, bringing in thousands per month. but the owner just goes, you know what, I want to do something else, retire, different, whatever, and now they're selling the whole thing as a fully functional business, and it might not need as much work, maybe a little polish here and there, but not as much work. What percentage of the time do those exist? That's all the time.

So what, I mean, most of the sites we buy are like that, but we're looking for ones that we like to buy them so that they're exist. So what's the word? Exactly the scenario you said they're running. You can literally just step in and run them. And then, but we're look, we also do, when we're doing our due diligence, we're looking for opportunities where ideally we can double them over time. We've got a great one. We actually just interviewed our client about this. Ashleen bought a little, just to learn this, a smaller site for around $18,000. This is US. Ashleen's in the US. And it was, on crochet and the owner actually this is an interesting one Mike because it brings in your earlier piece around you know the branding of the owner it was built around as a lovely mum she she was in

um where was she in america uh she's in rural America she's into crochet and she's a mom of you know three or four kids and she started this blog and it was built around her and around actually around her name, things called Amelia Makes. This has just happened recently. And that site was making around $500 to $600 US net semi-passively. And she was selling patterns and things and also a course on how to crochet. Now, Aiseline knows nothing about crochet.

But it was up and running, very, very stable, made that sort of money, month in, month out. These are monthly figures, by the way. She's taken that over. she hasn't had to do much. She's given a bit of a makeover, like redesign the home page, tidied up the sales page with chat GPT and just to make it a bit cleaner and leaner and a bit more clear. And I think she's owned it for about the last, how long now, five months.

And it's already doubled to a thousand dollars net profit US. And now that site will just tick along like that probably for the next five or six years. Yeah. And what she's done, sorry, the other bit is exactly what you suggested, you know, like coaches can do. And I actually said to Ashleen, do you get on well with the seller? She said, yeah, she's lovely. She's very genuine. She's a really nice lady.

And I said, well, go and meet her or at least get on Zoom with her and ask her if she'll stay on, like, once a month or once every couple of months even and, you know, put a guest like a little bit of a post up. And the lady was more than happy to do that because she, it was her. her passion site. She absolutely loved the website. So that's the advantage of finding these passion sites. Typically, the previous owners are happy to, you know, guest present infinitum. And Ashleyne pays her for that as well. So the mum's, you know, she's laughing. She gets a little, you know, once a month, she can do a little article, get paid for it. She gets to stay involved with the website. And that site will just keep ticking along at a thousand bucks. But to answer your question, like right now, we've been featuring another, like a really, a bigger site, like it's a mum blog that's selling for $3.5 million.

And that makes $150,000 a month net to the owner, to the mum blogger. It's in America. And you can see it's on flipper.com. And that's the sort of site I think that you're talking about where a bigger buyer can come in, Instead of spending, you know, $3 million on a bricks and mortar business, this site's just on autopilot. It just, you know, they, it's got a big following. They've got advertisers on there.

It makes that money. It's done that for the last 12 years. And really, if you bought that site, you wouldn't have to do a lot. I mean, you should do. You should always renovate sites. So I couldn't handle owning a website and not renovating it and fixing it up because you can. But you can get sites nicely dialed in so that you don't have to. to do too much. But in this day and age, things have changed a bit. They're not quite as passive

as what they used to be. You do need to be doing work. Once you're at that level where you're making 150,000 a month, obviously, there's a bit of a team there, but it's nowhere near as big as a traditional business. I think she's got three or four members on the team. And she works, that's it. You're able to pay those outsourcers and experts and designers. And to give listeners an idea of what it takes, she says in her listing, and I believe this would be true, she personally spends about 30 hours a week on it, and she just wants to retire. So for someone who's younger, you know, 30 hours a week to earn 150 grand a month. So we're talking, what, seven figures a year. Yeah, what a fantastic lifestyle. 28. Yeah. That's pretty amazing. And that's all digital in the cloud,

in the, you know, worldwide web. You can laptop. lifestyle the whole shot and I think that is so so powerful and I love that you put a line in the sand to say we don't buy anything that needs physical products because that just adds a whole other level of complexity. So I think that's that just it's using your brain power and and helping people out and everyone wins. So it's just really unique. I love the similarity to the real estate investing world because people understand buy and hold, buy and, you know, renovate, fix and flip, all of those kind of things. and it's very, very similar here. So what a neat approach. And I know that you've got your teaching and training and education academy to teach people

how to do this and then guide them to find opportunities. So, Matt, if someone is interested in learning more and reaching out and connecting with you on some opportunities that way, what's the best way that they can do that? They can jump onto our website and look at our free coaching, sorry, a free master class where we go through the actual strategy of where we buy these websites, the exact kind of sites we buy and lots of examples of them and the strategy that we use exactly like you said how we buy, renovate and then sell at a higher price. So it's a masterclass at e-business institute.com.com.

And there's lots of links on there. And also you can look at through the success stories of our students as well. We do lots of interviews with them on our podcast, which is called the digital investors.com. Awesome. I love it, Matt. Thank you so much for coming on. It's been a real pleasure talking with you. Thanks so much for having me on, Mike.

Likewise, it's real pleasure being here. You've been listening to Influential Entrepreneurs with Mike Saunders. To learn more about the resources mentioned on today's show or listen to past episodes, visit www.com.