This case study will probably be one of the most inspiring you will see on Selling The Biz. It’s a rags to riches story of Kyle Taylor, a young man who was in massive debt, but took the chance to start a small niche blog called The Penny Hoarder that grew to incredible levels.
How The Penny Hoarder Got Started
The Penny Hoarder was started in 2010 by Kyle Taylor. At the time, Kyle was 23 year old, in $50,000 of debt, and decided to start a blog about how he was able to save and make money in some weird ways.
When The Penny Hoarder launched in mid 2010, it was launched as a Blogspot blog ThePennyHoarder.Blogspot.com. According to Kyle, he started the blog as a hobby and never saw this as a real business. In fact, he was not even thinking about how to get readers.
Since he was $50,000 in credit card and student loan debt, he used his blog on Blogspot more as a form of therapy and a way to hold himself accountable. To hold himself accountable he would post numbers about how much he had made doing a certain job and how much debt he had.
The Early Years
In the early years of The Penny Hoarder Kyle would write articles on topics such as “I Get Paid to Buy Beer”, “Make Money Recycling Wine Corks”, and even “Selling Your Hair for Money”.
At the beginning, Kyle had a period of time when he was not working, so he did these different types of jobs to make money and then write about them.
Kyle’s posting schedule at the beginning of The Penny Hoarder was posting everyday for a few weeks and then ignored the site completely. It was just a hobby to him at the time so he was taking it too seriously.
It was at the end of 2010 when Kyle finally decided to move the blog from Blogspot to it’s own domain.
By the Spring of 2011 he got his first check for just over $100 from Google Adsense. Even at this point, Kyle didn’t see this is a full time gig but more of a side hustle. Maybe something to bring in a little extra cash.
Kyle spent a lot of time generating traffic in the early years by doing what most bloggers do, commenting on others bloggers’ websites, getting involved in online forums with other personal finance bloggers, and doing guest posting. His goal was to get someone to click one the links to his site and this would help the site get more traffic.
According to Kyle, the thing he wished he had focused on more was getting traffic through email. Email marketing was one of The Penny Hoarder’s best traffic sources at the beginning but Kyle did not learn until later that he should focus on that more.
Ramping It Up
It took until 2012 for The Penny Hoarder to finally start making some real money. In 2012 the site made around $20,000.
From there it grew even faster when the site made over six figures in 2013.
Most of the traffic at that time was coming from post such as “Make Money Playing Scrabble in Tournaments,” “How to Earn 17% Helping a Couple Adopt a Child,” “Free $20 Cash for Signing up at NetSpend,” and “Seven Places Where You Can Still Pan for Gold.”
From 2012 to 2017, The Penny Hoarder’s growth skyrocketed going from $20,000 in 2012, $7.5 million in 2015, to $37 million in annual revenue.
From 2017 to 2019 revenue continued to climb growing to $50 million in 2019.
What Type of Business is The Penny Hoarder?
The Penny Hoarder was started as a hobby blog on Blogspot in the weird jobs, saving money and making money ideas niche.
Like everyone who wants to find the perfect niche for their website, Kyle chose his niche simply because he was involved in doing some weird jobs. He was trying to find ways to make money on the side and to save money too. He would then write about it.
It wasn’t rocket science. The Penny Hoarder was started because Kyle simply wanted to share what he was doing. He really was not even thinking about making money with the site.
As the site grew, it evolved into an affiliate based model and that’s where it is today.
What Platform Does The Penny Hoarder Use?
The Penny Hoarder started on Blogspot and when it moved to its own domain, they have used WordPress hosting on AWS (Amazon Web Services).
What’s so great to see here is that this niche site is no different than your website. They use WordPress and hosting. Nothing fancy. This means that for the cost of a domain name and hosting, you too can start a niche site that may one day, sell and make you a nice sum of money like it did for Kyle.
How Does The Penny Hoarder Make Money?
The Penny Hoarder started making money with Google Adsense. From there Kyle began selling sponsored posts.
Over the years the site started making money from affiliate marketing and today, 95% of their revenue is from performance based marketing or affiliate marketing.
They also work directly with clients such as Uber. When someone signs up to be an Uber driver through The Penny Hoarder they make money.
A smaller portion of their revenue is from display advertising.
How Much Traffic Does The Penny Hoarder Get?
Most traffic estimators such as SimilarWeb estimate the traffic at 7.87 million unique users every month but we know this is on the low side.
According to the stats shown on their own website, this website gets an astounding 12 million to 17 million unique visitors every month.
Imagine for a moment starting a niche website and in 10 years, getting traffic in the neighborhood of 17 million users per month. That’s what we call amazing growth for a site that started on Blogspot.
How Much is The Penny Hoarder Worth?
The Penny Hoarder had $50 million in revenue in the trailing 12 months in 2020. Typically, a website’s value will be 2x to 5x annual net income. (others factors can be involved such as is the business in decline or on an upswing)
If The Penny Hoarder had an annual net income of $50 million in 2020, the website should be worth between $100 million to $250 million.
We know exactly what The Penny Hoarder is worth because the site recently sold for $102.5 million in 2020.
We don’t know exactly how the valuation was obtained, and if the $50 million in revenue was gross or net, but the fact is, the valuation fell right in line with a normal valuation.
Amount The Penny Hoarder Sold For
As stated above, The Penny Hoarder sold for an incredible $102.5 million in 2020.
This is such an inspiring example of what can be done with an idea, and starting a small niche website.
What You Can Do
Thank you for reading case study on Kyle Taylor and how The Penny Hoarder became a success story.
Now it’s time for you to act.
If you’re looking to get started building a niche website or already have a niche website and want to learn how to possibly turn it into the next The Penny Hoarder, we highly encourage you to look at our tools section to learn the best courses and tools to help you grow a business like this.
If you already have a successful website and are looking to sell and make a nice profit, we encourage you to read our guide on how to sell a website. In this guide you will learn everything you will need to know to exit profitably.
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