I'm a web development contractor working through a limited company. Wages are good but not astronomical and I'd like to fortify my financial position by diversifying my income.
For several years, I've been dabbling in various forms of entrepreneurship on the side of my main income but ultimately I'm reasonably cash rich and time poor.
Earlier in the year, my wife and I purchased a tutoring company. My wife was working in the business and it was sold to us by an old school friend. It's been a great investment so far, demand is strong and there have been loads of opportunities for me to bring my web dev skills to bear on it.
With that in mind, I'm interested in buying an online business at around the $200-$300K mark. I've been looking at a few this week and while there have been a few dogs, buying at this price range typically means a web business that's well established (+10 years old), with a stable income that would comfortably cover any repayments on the debt I'd have to take on to fund the purchase. There would also be some profit left over each month and after a couple of years I could either refinance to improve this margin.
Yes, there would be work required to maintain/grow the site but at this price point, the sites are very often largely automated. Of course, there's a risk that something could go wrong (e.g. the site is too dependent on SEO and a Google update kills traffic) but you aim to minimise this in your due diligence and take steps to mitigate it if you purchase.
All that said, I'm leaning heavily towards buying rather than continuing to try and build something from scratch in my spare time.
How do you feel about building vs. buying?
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