New Yorker Eric Porat has made a career out of digital investment. Here’s what we can learn from him.

Internet mogul Eric Porat started out as a nobody. He built a website from the ground up in 2005… and it had absolutely no traffic. The place was a ghost town. 

Fast forward three years and Porat had grown that website to more than 70,000 visits per month. Shortly after, he received an offer to sell it. It was the first and last website he ever built, but far from the last he sold.

Since then, Eric Porat has bought and sold over 50 websites for more than $600,000.

There’s a quote Eric Porat likes from Robert Kiyosaki: “The rich invest their money and spend what is left. The poor spend their money and invest what is left.” It’s pretty simple. The digital real estate market is the new frontier of investment. The difference between physical real estate and digital real estate is, there’s no shortage of land and no dearth of fertility, at least not for the savvy and stalwart.

“The rich invest their money and spend what is left. The poor spend their money and invest what is left.” – Robert Kiyosaki Click To Tweet

While you can, of course, build digital assets even without capital, investing time like Eric Porat did into creating sites from scratch, growing them slowly over time, and selling them, the better route is to invest some time and money into the acquisition of promising online sites with a moderate amount of traffic already and then grow them yourself to flip them (as we all know here at Flippa).

Digital investment in websites can be anything from affiliate sites to eCommerce stores, as well as blogs, magazines, and more. While there are plenty of other digital investments, like domain names, mobile apps, and digital products, websites are by far the most popular type of digital asset. The main reason that websites are the most popular type of digital assets (and generally the most lucrative for investment) is because they generally act as the central platform that integrates all the other types of digital assets on the internet. You all probably know this, as a Flippa reader, but it helps to remember the fundamentals.

Websites are also one of the most versatile forms of digital (or physical) assets. Like Eric Porat has done for years, you can turn a website into just about anything you’d like. A business, a marketplace, a magazine, a streaming site, whatever.

What We Can Learn from Eric Porat

It helps to think of buying and selling websites as a close cousin of the conventional real estate investment model that we all know. From interviews and online documentation, Eric Porat has revealed that he sees this as an apt comparison. From a basic perspective, instead of buying a piece of underutilized land, you simply buy a website that’s not fully utilizing its potential and can be made more profitable. Then, like a real estate developer, you invest money in improving various aspects of the site, such as content, branding, design, SEO, etc. 

The website investment market is a lucrative investment opportunity, for myriad reasons. For one, it’s an exponentially growing market. A recent study showed that global Internet penetration is near 57%. In other words, 43% of the world hasn’t even gotten on the Internet yet! 

This is Where the Tips and Tricks Come into Play.

The fast growth and new members of the Internet demographic mean that websites that provide information and solve problems are rapidly growing in value.

If you can find a site that solves a problem or has the potential to get a stranglehold on a certain information demographic or trend, you’re in luck. 

The trick is to understand what the site is doing right and what it’s doing wrong. If the concept is wrong, there’s no point in investing. If the design, SEO, and branding are what’s wrong… well then, all it’ll take is a bit of grease to get those cogs turning and start raking in the visitors.

According to Eric Porat, there are literally hundreds, if not thousands of sites online that have a stellar concept, but 99% of these aren’t delivering their product well, whether the said product is information (i.e. a magazine), a community (i.e. a social site), or a digital marketplace.

Target Niches

Many people don’t realize how niche some lucrative sites can be. For instance, a site called SendCatFacts.com, which only sends facts about cats to subscribers via email and SMS, sold on Flippa for $50,000! Yes, you heard that right. $50,000! 

If a site about cat facts can sell for $50,000, think about all the weird and exotic niches that could prove profitable. The possibilities are endless. That’s why niche targeting is so important. 

Eric Porat has always targeted niches in the market, with both his website investments and businesses. For example, one of his projects, launched back in 2018, was an e-commerce technology project with a brilliant core concept; a web crawler that would automatically scan thousands of brands’ websites, find products that were on discount and then link to them with affiliate links. 

At first glance, the site looked like an ordinary e-commerce website, but in fact, it was a fully automated platform that was researching, updating, and listing discounted products. In September 2020, after less than two years, Porat sold this project for a large, undisclosed sum.

Hit unique ideas like this. Find gaps in the market. Find a niche, and even if it’s obscure and inane, like a website about cats, as long as there’s no competition, there’s a good chance you can grow and expand it into a profitable asset over time.

Let’s go back to the real estate analogy. For example, some people might not like to live in the desert. Some people might not like the mountains, some might not like the beach, some might not like cities, some might not like small towns. But there is a market for each of those locales. Some people on AirBNB are even renting out treehouses for hundreds of dollars a night. Treehouses! 

The trouble with real estate investment is that it’s limited to a physical location. The Internet is everywhere and anywhere all at once. There is no limit. So niche markets aren’t something to shy away from. Everyone looking for that niche will find you if you make sure to optimize your SEO. That brings us to the next point.

SEO is the Key

Most business websites and blogs, even ones with excellent concepts, large followings, and a dedicated, professional team, aren’t well optimized for search engines whatsoever, and frequently have design detriments as well. SEO and UX are perhaps the most common faults in website success. 

So, look for sites with poor SEO and UX that are doing everything else right. Having an idea, starting a site, and publishing content is easy in the 21st century. Even a moron can get a site live with WordPress. SEO and UX, however, are technical skills that take training to learn. Most people don’t have this training or experience. Oftentimes, Eric Porat has found that simple SEO steps can turn a ghost town website into one landing 50,000 unique visitors or more each month with little effort. 

The one thing it will always take, however, is TIME.

It Takes Time

This is the single biggest mistake that website entrepreneurs make. SEO is a long game. Lucky for you, as an investor, you’ve already thrown in your chips and the site likely has already been live for some time, so you just have to have the grit to hold on. That said, if the previous owner wasn’t doing anything with SEO, maybe the domain has aged, but not much other progress has been made. 

Organic search traffic plays a key role in driving visitors to a site, but even if your site has excellent, regularly produced content and high-authority backlinks, entering Google’s top ten results for a competitive keyword takes time. Lots of time.

A study by SEO tool Ahrefs revealed that almost 60% of every page ranking in Google’s top 10 is more than three years old. 

That means you need to be ready to sit tight, and make steady, moderate adjustments and improvements over time. 

Eric Porat

Eric Porat

Eric Porat is a tech entrepreneur who focuses on website acquisitions and building digital assets. You can learn more from him by visiting his personal blog, or connect with him on Twitter, Linkedin, Pinterest or Youtube.