$8 Startup Costs Lead to $400,000 in Annual Revenue

This transcript was generated from the episode audio and may contain minor errors.

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Test, test, hello, is this on? Well, I hope you can hear me. It's just three days until the side hustle book comes out. I am super excited, but I don't want to overdo it. So I'll tell you more about it tomorrow and next week as the book goes out and as I hit the road.

For now, have you ever done something bad that ends up being posted on the internet? Well, I hope that question doesn't bring up any bad memories for you. But today's featured side hustler found a way to profit, a lot in fact, by helping people fix this problem. Now there's this whole new industry of online reputation management. It's kind of been created in response to celebrity culture and not just celebrity culture, but also social media culture.

People posting all kinds of things, sometimes of things that they've done, perhaps something that they might regret or at least might regret showing to the world. But also there's all kinds of stuff posted about other people, individuals and companies. So today's story is about a guy in Las Vegas who ends up learning about this industry by accident, spending a grand total of $8 to start a new side hustle and ends up making multiple six figures from that project just two years later. That story's coming right up. [Music]

A chronic side hustler since he was first making candy money at the age of 10, by day, Alex Simon is a partner in an event staffing company based in Las Vegas.

And to understand where his latest, highly profitable side hustle comes from, we have to go back to the mid 2000s when he was working in marketing and PR. His company became the victim of online defamation by a competitor that posted false claims all over the internet. That competitor's CEO eventually ended up in jail on unrelated charges, but the damage had been done. It was hard for a marketing and PR company to bounce back after seeing its reputation harmed so publicly. But Alex also saw an opportunity.

He saw the need for people and businesses to fight back and take control of their online presence. The idea stuck with him as he worked on other projects. And in 2015, he decided to see if there was a market for it. He contacted friends and colleagues who were dealing with some negative online information and asked them if they could quantify in dollars what this negative online presence was costing them. Each was able to give him specific dollar amounts by comparing the amount of money they made before the negative press and after.

Alex then offered them a chance to regain control of their online presence for a fraction of the amount of the lost revenue. Each of them saw it as a no brainer investment so they jumped at the chance. And for Alex, not only did he now know that this was a great idea, but he also had real life subjects he could use for market research. Within a couple of weeks of starting that market research, Alex decided to launch Digital 86, an online reputation management agency. Alex has always believed in investing minimally in a side hustle until it proves it can be profitable.

So even though he wanted to take this new business seriously, he used Squarespace to drag and drop his own simple website. For just $8 in hosting per month, he could now offer his new services to potential clients worldwide. This $8 a month represented his total startup costs, and two years later, it's pretty much the same website he still has. In addition to that pricey website, he also used a free $100 credit from Google AdWords to do some online marketing. This was a pretty good investment because within a week of launching that site and setting up some ads, Alex landed a retainer client for $6,000 a month.

I don't actually know how many months that client remained with Alex, but by my calculations, just that first month of service pays for his $8 a month website for the next 62 and a half years. So successful decision there. He also kept things simple by processing payments through PayPal. After a couple of months, he was making more than his previous job, and he even had to hire part-time contracted staff to take care of accounting and administration. Eventually, he began to outsource some of the work, but he notes that he is the only one to work directly with clients.

Now, how does he actually do what he does? How does he actively repair people's online reputation? Well, some of that is a secret. It's the proprietary nature of this kind of work. But here's an example.

One particular firm had recently fired a partner for inappropriate behavior. And this made it into the news. So when potential customers did an online search for this company, the first few pages of results were only news about that firing. None of the company's philanthropic work showed up. None of what they actually did to serve clients showed up.

And in addition, none of those results feature that company's quick response in removing the partner. So Alex was brought on to return their online presence to what it was before the unfortunate firing. For both Alex and his clients, the results of a campaign like this are easy to measure, both in online presence and return on investment. Clients are able to compare pre-incident revenue to mid and post-incident revenue to confirm the results. That and a 10 second Google search is all it takes to prove that Alex has done his job.

In fact, he says, if I do my job well, when you Google my clients, you'll see positive results. If you can build a business like this where the results are unquestionable, you'll never run out of people wanting to hire you. And that's how it's worked out for him. These days, his happy clients are his best marketing that $100 credit through Google AdWords from two years ago was the only marketing he did. Alex now has a waiting list for his services and actually has clients apply to work with him.

Over the past two years, he's helped celebrities, professionals and businesses regain control of their online image. And in the process, he's created a thriving business. He expects to exceed $400,000 in revenue this year. That's right, $400,000. This has not only changed his financial situation drastically, he was also finally able to take his wife on a long overdue honeymoon.

A pretty amazing situation for someone who discovered this new industry entirely by accident. [Music]

Well, first lesson, be careful what you post online, either about yourself or about someone else. But second, I wanted to comment on what Alex is actually doing in terms of the online reputation management. Now, like I said, some of it is proprietary, so I don't know exactly what hacks he uses or tips, but basically what these agencies do is a combination of SEO and positive publicity. So basically, they're going to improve your search results for terms that you want to rank on, presumably taking some of those negative results and references and articles and pushing them down the listings, or maybe even getting the original sites to remove them.

And then also getting positive articles published about you or your company. So SEO and positive publicity, there's probably some other tactics and more to it that I don't know about, but I'm pretty sure that's the general idea. And obviously there's a lot of skill to this, but it's also not something that you learn in school. And these are all things that are fairly learnable. Is learnable a word?

Well, I just mean it's not that difficult to go out and research something like this. Anyway, there are lots of ways to make money. That's why I feature different stories every day on the show. No guarantee that you'll sign a $6,000 a month retainer client from spending $8 a month on a Squarespace site. But that's exactly what happened with Alex Simon.

And I do believe there's something out there waiting for you to. As always, inspiration is good, but inspiration with action is better. Today's show notes are at sidehustleschool.com/259. If you've got a question or a comment, give me a call. The hustle hotline is 844-9HUSTLE or 844-948-7853.

I'm Chris Guillebeau. This is "Side Hustle School." I'll be back tomorrow with the weekly recap. [Music]