The Dutch Formula: How to Build a Multi-Million Dollar Company in 12 Months by Kendall Baker @FortuneMagazine February 28, 2016, 11:32 AM EDT E-mail Tweet Facebook Linkedin Share icons This piece originally appeared on The Hustle.com. Have you ever dreamed of starting your own company and getting filthy rich? Of course you have. Me too. But I’m lazy. And selfishly, I’ve always hoped someone would give me the formula for getting started — a recipe to follow, step-by-step. I’ve dreamed of being shown some kind of a roadmap to millions. However, over the years I began to realize that there is no roadmap. The formula for building a successful business doesn’t exist. That is, until a week ago, when I was introduced to William, one of the most interesting business owners I’ve ever met. William is the founder of something we all know about but refuse to admit we use: a clickbait website. In fact, he’s started multiple. His most successful sites are worth millions of dollars, they only require $5k (and a couple months of William’s time) to launch, and are built using the same exact formula. William isn’t his real name, by the way. He asked that I keep that a secret. But everything else he told me, I’m telling you. I’ll begin with the first email I received from him, which as you will see, took me by surprise… The email To: HOLLER@hustlecon.com From: A totally random email we had never seen before Hello, I’ve been reading The Hustle for months and really love what you guys are doing. As you continue to grow your business, perhaps I could be of assistance? I’ve started numerous websites, many of which are worth millions of dollars. I have very little experience in digital media and produce none of the content on my websites myself. Instead, I have developed a formula, which relies heavily on Facebook, that helps me identify the right types of websites to build and drives lots of traffic to them once they’re up and running. As an example, one of my most successful websites was launched approximately a year ago. Since then, I’ve had over 100 million pageviews and 13 million unique users. Last month I had 3.5 million uniques alone. I have no marketing team, no sales team, and no investment money. A total of two people are employed full-time for this site. One is an editor and the other is my assistant. I really believe in your product and would love to help you guys. Do you have a social team that would want some advice? I live nearby so I’d love to come in and meet the team. Keep up the great work. Best, William Alright, so obviously this reeked of bullshit. The guy happened to live “nearby” and had a formula for making millions of dollars. Worst of all, the numbers were outlandishly high. For those unfamiliar with web traffic metrics, 100+ million total pageviews and 3.5 million monthly users a year after launching is insane, especially with no investment. As a comparison, it took Business Insider over a year to reach its first one million monthly users (again, last month William had 3.5 million). Business Insider now has 70 million users a month, 300+ employees, and recently sold for close to $500 million. Ever heard of BuzzFeed? Two years after launching, BuzzFeed was averaging just 700k monthly users. Now it’s worth close to $2 billion. So, despite being suspicious of William’s claims, he had certainly caught my attention. If this guy was telling the truth, not only did I want his advice, but also his story. I wrote back, telling him I’d love to meet. The meeting William came to our office a few days later. He was a nice guy, with a thick Dutch accent and great surfer-style hair. We talked for a few minutes about William’s childhood (he dropped out of high school in Amsterdam at 15 to become a DJ), his past work experience (he was a party planner for years), and how he had heard about us (he attended Hustle Con last year). After the small talk ended, I wasted very little time in getting to the good stuff. Let’s see those traffic numbers! William logged into Google Analytics and instantly confirmed what I thought was impossible, or at least an exaggeration. 100+ million pageviews? Check. 3.5 million monthly users a year after launch? Check. William converted MAU data from Excel to create this graph for me Then we started talking about revenue. As I’d come to expect, William was incredibly transparent. Each month, he invests $30k into the business and makes $220k in profit. Advertisements are his main revenue stream, which would make sense considering the traffic numbers. And while $220k a month seemed a little high at first, some simple math proved it was actually quite realistic. The average CPM (cost per 1,000 impressions) for display ads in 2015 was $2.80. With 100+ million users, that’s over $280k annually from one ad alone (and $23k per month). Considering he features multiple ads on each page, sells ad space on his email newsletter (which is much more lucrative), and only has two full-time employees to pay, William’s numbers add up. The formula The final question I had for William was about “the formula.” He had initially mentioned it in his email and it had come up a few times since, but I needed more details. He said this formula was something he had created, almost unintentionally, after starting his first few websites. He knew very little about digital media in those early days, relying entirely on his understanding of Facebook fb instead. He was adamant about its effectiveness and said that every million-dollar website he had created was started using the formula. But he also maintained that it was his own hard work that led to his success and that he wasn’t too worried about copycats if he were to divulge the recipe. So, I asked him if he would. Ladies and gentlemen… the pathway to millions: Step 1: Select 10 niche markets The groups of people must be passionate and engaged. Some examples William gave were MMA fans, eSports fans, and people who watch Game of Thrones. A few that he had tried in the past that hadn’t ended up working out included wrestling fans, hip-hop fans, and politics. Reasons for failure included lack of engagement and too many existing websites serving the same purpose. Step 2: Create a Facebook Fan Page for each market Start advertising in order to buy Facebook likes. For instance, if you chose MMA fans as your target demographic, the page should be called, “Fans of MMA” or something just as non-specific. William spends around $200 on each niche market, but the number doesn’t matter so long as you keep it consistent across the board. Why? Because all you’re doing here is trying to identify your “winner,” which is whatever niche market produces the highest engagement and lowest cost of likes. William said that it’s a great sign if you’re able to buy likes for under five cents. However, his most profitable site was able to buy likes for a penny. Step 3: Post other people’s content on your pages Since this is still the “testing phase,” your content doesn’t need to be groundbreaking. In fact, feel free to straight up steal it from similar pages if you want. That’s what William did initially. “When I first started doing this, I didn’t speak English well enough to make my own captions. On top of that, it wasn’t like I really knew anything about the groups of fans I was targeting. So, I would find similar Facebook Fan Pages, see which posts were doing well, copy them exactly, and post them in mine.” Step 4: Pick a winner, buy a domain, and build the WordPress site Here’s where things start to take shape. You’ve selected the market you’re going to create content for, now all you need is the website where you’ll be posting your articles. William doesn’t know much about building websites. Thankfully, there’s a formula for that, too. “Getting a website up and running is incredibly easy nowadays – and cheap. Go to GoDaddy and buy a domain name, which comes with WordPress hosting. It’s like $5 a month. GoDaddy installs WordPress for you.” “Then, go to a site like www.themeforest.net and pick out a ‘theme’ that you like. These cost anywhere from $40 to $60. I’ll usually hire a developer for cheap on Upwork or Elance to install the theme and get the site ready for launch.” Step 5: Hire an editor and start posting 2-3 articles per day William uses Upwork to hire an editor. This is a full-time position but can be done remotely (the editor for his newest site is based out of New York). In the beginning, it’s all about finding the type of content that gets the most clicks. “Similarly to the way I look at other Facebook Fan Pages to see what content is doing well, I’ll research other websites and pick their best-performing articles. Then I send the links to my editor and tell them to write an article on the same exact topic. She’ll write the article, or she’ll assign it to one of her Upwork writers.” The expectation is 2-3 articles per day to start, all shared on the Facebook Fan Page. “Once you start producing content, make sure you have Google Analytics installed so you can see how certain articles are performing. Don’t just look at the number of clicks to a specific page. Look at how long users are on the page and whether or not they click to another page or leave the site. Let the data speak to what the readers like.” Step 6: Create (if they don’t exist) or buy (if they do) more targeted Facebook Fan Pages This is, without a doubt, the most crucial step. The foundation has been laid, now it’s time to build the house. “When I say ‘more targeted’ Facebook Fan Pages, I mean more specific niches within the overall market you’re serving. For example, if you’ve created a website for fans of crime TV shows, you want to start creating or buying (from current owners) the pages for fans of CSI, Law & Order, etc.” Though I can’t divulge the name of William’s most successful website or the market it caters to, I can tell you that it’s comparable to someone owning the fan pages for not only CSI and Law & Order fans, but of every single crime show on television. Here’s an example of one of William’s more “targeted” fan pages: Every link shared in this group leads back to William’s site. It’s also one of many within this niche market, so the potential for huge traffic numbers is abundantly clear. And remember, the original test was to prove that these fans are passionate and engaged. So, you better believe they’re clicking on the links. I asked if we could take a look at real-time traffic to see just how powerful this Facebook model was. As you can see, 1,673 out of the 2,224 people on the site had arrived via Facebook (roughly 75%). The traffic sources over the course of a full year looked similar: Step 7: Hire freelancers to ramp up content production “Once I have the Facebook Fan Pages under my control, the most important thing is to provide enough content to satisfy people’s needs.” To do this, William hires freelance writers. Each writer is paid $10 per article and each article must be at least 350 words. The goal is 30 articles per day in total. Step 8: Start investing money back into the business in order to build a self-sustaining ecosystem Invest money from display ads on the website into buying Facebook advertisements. As more people join the Facebook Fan Pages via these ads, more traffic comes to the site and more ad revenue is generated, which is then invested back into Facebook advertisements. Step 9: Life after Facebook “Nothing lasts forever and this strategy is no exception. Just like with Google Adwords, the cost of Facebook Ads will increase to a point where this strategy simply does not work anymore. So building an email list and thinking about SEO when crafting content is important, and both will be beneficial when that day arrives. Or you could always sell your site before that happens.” “By the time this Facebook model becomes ineffective for growth, my websites are normally worth a good deal of money.” Takeaway It’s no secret that Facebook just changed its News Feed algorithm — and probably will again in the future. This illustrates the danger in relying on an outside platform to drive traffic like William does, and most likely means that this formula has already seen its best days. But this story isn’t about the formula, is it? It’s about William. It’s about a guy who creates websites that most of us ignore because they look sleazy and aren’t something to be proud of. However, he is making massive amounts of money doing it and I find his work ethic and mindset to be fascinating. Part of me wants to live that life. At the same time, building businesses in machine-like fashion just doesn’t seem like something I’d enjoy doing. Perhaps I’m more of the creative type and just don’t get the same thrill out of execution that I do from generating new ideas. Or maybe I just hate clickbait sites. Regardless, William’s story proves that you don’t need some genius idea to make millions of dollars. Sometimes, all you need is a process. And it all starts with Step #1.