#17: Weekly update on digital private equity
Another autumn episode. 🍂
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🔦 Promising assets
Again, I found a few interesting domains.
Domains with existing authority:
Buying domains with existing SEO authority can give you a head start. Why?
SpyChecker.com (<$600, expires 11/08)
With >33.3K backlinks and a DR of 53 this domain is quite 🔥. I expect the auction to heat up, but if you plan to offer anything related to the topic, this domain could help you quite a bit.
Backlinks from CNN.com, Springer.com, Time.com, and so on. See here what the domain was used for (hint: ad-supported online spyware database).
Domains to build a brand on:
Those domains have no SEO authority yet but are great to start something new on.
Newsflash.com (<$13,000, expires 11/08): Fantastic domain, but quite expensive already. However, if you are planning to launch or already own anything news-related, this domain could be waiting for you.
SnowMaster.com (<$1,700, expires 11/09): I am sure that there are quite a lot of products that help you “master snow”. From ski to plowing equipment.
Great websites to acquire:
eCommerce Website (min. $400,000 valuation, private deal)
One of our readers is selling his profitable apparel e-commerce business (yearly net profit in modest 5-digit range).
A few facts:
based in the US, well-established business (started in 2008),
100% of sales made via their own website,
7 active product lines with approx. 170 SKUs (size, color, collar-style variations),
strong re-order rate at 34% (2010-2020),
refund rates <4%,
over 10,000 reviews, with a 4.6 overall satisfaction rating
🌱 How I would grow it:
Experiment with various growth channels (e.g. play with look-a-like modeling based on CLV cohorts)
Migrate shop to Shopify or a similar platform to benefit from existing integrations (e.g. marketing automation tools such as Klaviyo)
Launch one or more specialty products to enrich the current product portfolio
The seller will share details only with serious buyers. Please reach out to me at firstname.lastname@example.org so that I can connect you with the seller.
🗞 News & interesting finds
Thinking about investing has its charm, but also complexity these days. You may have heard about Ray Dalio (and his book “Principles”), but maybe not about his All-Weather Portfolio idea. I love investing in websites and everything that comes with it but might use this approach for my regular investments.
The core idea: mix different asset classes that minimize your risk exposure as they are negatively correlated and behave well in different market environments.
If you backdate the performance of this approach until 1988, you will realize that the return is quite good - but it behaves extraordinarily well when it comes to potential drawdowns in times of market turmoil.
The Compound Annual Growth Rate (CAGR) was approx. 9.08%, while the maximum drawdown in times of crisis was only (!) -12.55%, which is astonishing.
Let’s look at the more recent years and compare it to the S&P500:
In other words, if you would have invested in the S&P 500 your risk exposure would have been a magnitude higher as you would be entirely dependent on the financial market behavior of the stocks included in the S&P 500. Comparatively, the All-Weather Portfolio saw a 1.29% lower return, but at a maximum drawdown of only -11.98%. So all in all I feel that this approach can be a great addition to my “digital investments” with an entirely different risk-return profile.
Now the trick is or can be - to replicate this approach with ETFs. John Tyler Williamson wrote a fantastic article about this (and how to even leverage this portfolio approach) on his website: Read more here.
What are your thoughts on this? Hit reply to share your comments.
⚠️ This is not investing advice. I am purely sharing what I learned for educational purposes. See my disclaimer here.
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