rasputinsghost - 8:31 am on Sep 28, 2012 (gmt 0)
So lets start looking a Protecting Income
Now there are a number of ways to monetize your websites.
You can charge a fee to allow visitors to view your site or use a service provided by your site. (Simple - Membership Fees)
You can market and sell a service, software app or physical product/s on your site. (Simple - Online Marketing and Sales)
Or you can build up a site that has information that will draw users to the site and then allow adverts to be displayed on your site based on the content of the particular page being shown, thereby generating an income. (Simple - Just develop a killer content site)
If it was all so "simple", everyone would be doing it!
The fact of the matter is that a lot of "everyone"'s are doing it - well, trying to at least.
Some are succeeding, some are not. And not every attempt by the successful ones succeeds either.
Lets call our intrepid entrepreneur Harry Blogs - married, 2.4 children, owns his own house and is incredibly bored with his job.
For the last 2 years, Harry has been developing one site per month - regular as clockwork, and he seems to have cracked the "finding" technique and his "content" technique has also become pretty refined.
Now about 14 of these sites are regularly earning better than $100 a month in advertising revenue with Elephant.
Recently one of Harry's buddies sent him a link for an article about some guy who had his advertising account closed down on all his (well over 100) sites and how this guy is now getting divorced, has a drinking problem and....
Suddenly Harry realized that his own little endeavor was actually making a rather significant contribution to the he and his family.
But how to prevent a disaster from happening to him started to become the question that he pondered more and more.
Eventually an "overall strategy" started to take shape - Start using a whole bunch of "BASKETS"
Whats this "BASKET" nonsense?
Essentially, if you only have one advert account and are running 24 sites through it, then if that account is shut down, you loose ALL your income.
However, if you have 4 accounts and each account has 6 sites, shutting down one account is not as big a disaster.
Cool! Lets go and open up multiple accounts and start splitting things up - easy-peasy!
But it is not quite so easy - or so advisable.
Firstly, you as an individual are only allowed one account - EVER!
(Go read up on all the legal stuff on the elephant site - A lot of it is in "legalspeak" and you have to read it a bunch of times to understand it but it is advisable to make sure that you understand the "rules", event though one of the rules is that they can change the rules at any time without notification!)
Ouch! So Harry is not allowed to open a second account! Harry is screwed.
But maybe not.
Elephant deals with "legal entities" and no "legal entity" is allowed to have more than 1 account.
So the solution is to create a separate "legal entity" and let that "legal entity" do the interaction.
Put simply, Create a company (legal entity) and use the company (legal entity) to do everything.
Now this may be "the answer" but it has got thousands of pitfalls, any one of which may trip you up.
Different countries have different rules and ways of doing things.
Each state/county/province in each country may have different rules.
Different cities may have different rules.
Some rules favor you as the company owner/shareholder/proprietor/whatever and some do not.
Make sure that you understand them!
And when picking a name for your "legal entity", do NOT use names that are obviously trying to mask something or other - example "Protected Income LLC" would not be a good choice - nor would "Harrys Advertising Income #1 (Pty) Ltd" be very advisable.
Something like "Seedapple Investments LLC" would be better.
Once you have figured out which "legal entity" would be the best for you, get it set up but for heavens sake be careful of things like audit requirements (means you will have to pay an auditor to sign off the books once a year which may be costly)
Also, make sure that you as the human being in the equation is insulated from the "legal entity" - you do not want a situation where something goes wrong, the site gets sued, the "legal entity" gets sues as the owner of the site and you get sued in your personal capacity as a shareholder or whatever in the "legal entity".
You are spending good money setting this whole thing up, do it properly and protect yourself!
Maybe it would be a good idea to find out some of the auditing companies or "man alone" auditors in your area and find out if you can do their site for them and they do your audit sign-offs. (and possibly give some advice along the way)
If you are able to swing something like this, it would be a good idea to put your absolute best work into such a site.
So for about $100, Harry has now got another site to do (the auditors site) and has a LLC, (PTY) Ltd or whatever "legal entity".
(Quick "heads up": make sure that the "legal entity" you decide on is able to operate bank accounts and other "useful" stuff.)
The next thing to set up is some sort of financial transaction account.
It does not have to be a check account or a savings account or a credit card account specifically.
Nor does it have to be with one of the Wall Street Rapist banks - in fact, if it is with a local or regional credit union or building society all the better - you are keeping the money you pay in fees in your local area and community.
Be very careful of "minimum balance requirements", "transaction fees", "minimum transaction requirements" and the like - every financial institution needs to make money and at some time or other they ALL at some time or other get some a$$hole in charge that thinks he can "improve the bottom line" by screwing the customer.
And they get VERY creative with the names they give to these "rape fees" - one of my accounts suddenly started showing a "STD Acc Fee" and when I asked I was told that "In an effort to streamline the transaction processing, the bank had outsourced the transaction processing and this fee was raised to cover the cost". WTF? "Oh but it is standard practice to pass costs along to the client!" - YEA? Well, its MY standard practice to tell banks who try to screw me to "GET F@%$@#CKED" - especially when MY information and transaction details are being handled by third parties without my permission. 20 minutes later I walked out with my balance in my hand and the account closed.
ALWAYS check the fees that have been charged to your account each month and if there is something that is wrong, some fees are going up when the transaction count and total values have remained the same, query them. If you do not like the explanation or if they cannot/will not explain in detail what is going on, maybe it is time for a change.
So now you have a "legal entity" and it has a bank account.
Next you need an email address - Please do not use any of the "normal" freemail services - they are not secure.
A large number of financial institutions offer a free email account to each account holder - if yours does, use that.
At this point, you sign up as a user with Elephant using your "legal entity" email account and name - Remember that the only place where your name and the name of the newly formed "legal entity" are linked is on the registration papers. NOWHERE ELSE ! Keep it this way.
Or you may want to register "legal entity".net (or whatever) in your name and then "sell" and transfer it to the company making sure that the the DNS record reflects that the ownership has changed.
This often is where people screw themselves - they use the same physical and/or postal address for all their "legal entities" - its a dead giveaway!
So, what can be done?
Well, that depends on where you live and how creative you can get.
If you live in a house and you can name it "Joes Office Park" by putting up a small sign next to the letter box, you could use a postal address like "Suite 21, Second Floor, Joes Office Park, 1435 Somestreet, Sometown, Somestate, 16589, United States of America"
Should work pretty well!
If 1435 Somestreet is viewable on ElephantMaps Streetview then anyone can very quickly see than it is a single story residential home, not an office building with at least 2 floors.
If you live in a gated community that will not allow the streetview vehicle in, it will work.
The easiest one would be if you had a family member (Bob - your uncle) that does own a commercial property.
It should be the easiest thing in the world (if Bob agrees to it) to simply add a letterbox for "Business Suite 23".
And Bob's your uncle, (come on--- you must have seen that one coming!) you have a pretty valid postal address, and a physical address that will pass the streetview test.
Once you have it figured out, sign up as a user with Elephant using your "legal entity" persona.
Now you need to transfer one of your good sites to "legal entity" - THE CORRECT WAY - DNS RECORD AND ALL.
Make up a couple of ads that match the existing ad sizes that tells everyone that the site has a new webmaster, that anyone wishing to advertise on the site must contact email@example.com and some others and replace the current ads on the pages with those you have just created.
At the same time you can make all the "I'll do that later" mods and adjustments that you need to.
Then you put the site in your webmaster account, do the verification and wait for it to be properly worked over by the bot.
Then you apply for a nice shiny new ad account for your "legal entity" user name and point them to the site that has been transferred.
And hopefully you get your advert account.
Start transferring from your personal stash "legal entity", doing the DNS record thing, making changes to the sites as needed, replacing current ads with "change of webmaster" notifications and placing "advertise here" ads, register in the webmaster account, submit sitemap, once the site is crawled, create Elephant ads and place them.
Maybe you have gotten some takers for your "advertise on this site" ads. Cool! Try to convert them because if you are clever and don't get conned into ridiculously low CPM rates, they should give you more income than the Elephant ads.
If they want a CPC model, you will have to come up with the necessary scripting to allow the clicks to be recorded, monitored and reported.
ALL payments for adverts are up front and cleared BEFORE THE FIRST AD IS DISPLAYED!
WHEN THE MONEY IS USED UP, THE ADS STOP!
You may have a site that is able to generate income from in house ads that is greater than the income generated by Elephant ads.
If this is the situation, congratulations! You have hit the Holy Grail of monetizing websites !
But for us "normal" folk, we won't be that lucky.
One last note:
When transferring sites out of your personal "bucket" to your different "legal entities", try to keep type with type.
Before you create a "legal entity", think about what sites are going to be in there eventually.
Possibly name the "legal entity" appropriately.
As you transfer the sites in, create a bunch of "cross-links" - it an only be good because then visitors start moving around your sites and that can only improve earnings.
Lets use a "For Example" here:
You are passionate about wind surfing.
You have about 15 sites that are about some aspect of wind surfing, anything from a venue listing site to competition results to a what an I doing wrong forum to a blog site where you interview competitors and you even have a medical site that shows the basics of how to set an emergency splint on a broken leg.
You have set up Max Wind LLC and the associated bank account
Max Wind LLC has an Elephant ad account which pays into the Max Wind LLC bank account.
Max Wind LLC has a number of its own ad clients and distributes ads to all the Max Wind LLC sites - money goes to the Max Wind LLC bank account.
Your auditor is able to easily and accurately audit Max Wind LLC because everything goes through one bank account - he is happy.
Over time the #1 sail company has started advertising on your group of sites and the advertising has been effective.
And as usual the bean counters eventually get involved and start doing calculations.