My blog get money from $1140 (Sep 2005) to $12K (Sep 2006)

StevePavlina.com is two years old today. Here’s a status update for those who like to follow the business side of blogging.

Year two was a relatively smooth continuation of what began in year one. The nice thing about running an online business in its second year is that you finally get to enjoy some of the payoff from the groundwork laid in the first year.

Traffic and income went up substantially in year two, but income increased at a faster rate, mainly because new income sources were added such as text link ads and donations. A year ago the only income generator was the Google Adsense ads; today Adsense is responsible for about 60% of income. Even so, I continued to tweak the ad layout, so the Adsense CPM today is considerably higher than it was a year ago. Optimization makes a big difference.

Here are some of the highlights that occurred in the second year:

* The number of articles doubled from about 250 to over 500
* Monthly web traffic tripled from 410K to 1.3 million visitors
* Monthly bandwidth increased 6x from 90GB to 560GB
* Monthly revenue increased 10x from $1140 (Sep 2005) to $12K (Sep 2006)

Erin also launched ErinPavlina.com in Jan 2006. She only started generating income from her intuitive readings 3-4 months ago, but she’s already earning over $5K/month from them. She’s had to increase her rates every month so far to avoid overbooking herself. It wouldn’t surprise me if her rates doubled within the next year purely as a result of supply and demand. This is interesting because her blog doesn’t generate income directly, but she earns this income because of her blog. We have several other revenue streams as well (book sales, royalties, etc), so we’re in pretty good shape income-wise.

Our only significant expense for these sites is the web hosting/bandwidth, which is $149/month for a server shared by both sites.

Erin and I are both pleased with these results of course, but we still feel like we’re just getting started. It took me a good five years to reach stable profitability with my first business, so this was much quicker. We both remember a time when we had to consider the cost implications of renting a movie.

What about year three? Year three is the time to implement some big expansion plans. Some of that will be visible online, such as the upcoming discussion forums, but most of it will be offline. Erin and I will probably stop working from home within the next year and move the business to an outside office. She already has a part-time assistant, and I could really use a full-time assistant, but our home offices are too cramped for that. I’d also like to find an office with a large enough meeting room where we could offer workshops on a regular basis.

This rapid growth has been great, but it also gives me a headache when it comes to business planning. I can’t even predict where our income will be three months from now, let alone a year; I just know it will be higher. I suspect our greatest challenges in year three will be building a staff and carefully managing cashflow. An office and a staff will mean significantly higher expenses, but it will also allow us to get a lot more done. I considered outsourcing, such as by hiring a virtual assistant, but I really need someone to work with face-to-face, since a lot of things need to be done locally.

The point of this expansion is to improve our capacity to help people grow. I can’t even keep up with all the emails I get, and my to-do list grows faster than I’m able to hack away at it. Fortunately, this is a problem that money can help solve.

It’s been said that money is a resource that makes you more of who you already are, and I think that’s very true. It’s strange to say this, but I feel that the more money that flows through my life, the more “me” I feel. I’ve been thinking a lot about how I can use this cash to support people’s desire to grow, and I appreciate all the suggestions people have given me. I’m a temporary custodian of this money, not its owner, so I’m always thinking about how to keep it flowing. I can’t take it with me when I die, so I might as well put it to good use while I’m here.

It’s a double blessing to earn a nice income doing work I’d gladly do for free. Even if my income went down, the work is so intrinsically rewarding it wouldn’t matter. I regard this money as “manifestation credits” from the universe for helping others get what they want from life.

Year three is going to be a lot of fun. I hope you come along for the ride.