Burnt-Out At 20, Making $20K A Day - with Max Teitelbaum

http://mixergy.com/teitelbaum-whatrunswhere-interview/

by casesandberg • 15 years ago

24 13 15 years ago

sixtofour• 15 years ago

"Andrew: What you were doing was, you were buying ads online and running affiliate advertising against them. The profit was the revenue that you were making from the affiliate programs, what they were paying you every time they got a new order or lead, minus what you were paying for your ads, right."

For the hard-of-money-making, what does this mean, how does it work functionally (black box inputs and outputs), and why is it profitable?

AndrewWarner2• 15 years ago

I think what you're asking is "how do affiliate programs work." Is that right?

Here's an overly basic explanation that could help: You send a user to a web site. The user buys or fills out a form. You get paid a commission.

pan69• 15 years ago

No. I don't think that's being asked here.

Normally with affiliate links, or how most people understand it (at least I do), is to place these links on YOUR website.

This seems to go in a slightly different direction where you place and ad for some else on a third party website. However, it's not a real ad, it's a third party affiliate link (your affiliate link). Very clever.

_delirium• 15 years ago

You join an affiliate program that pays you some commission per lead or sale, like Amazon's that pays you 4%+ (depending on volume) per item sold, or many of the things on places like Commission Junction, which include things like 1% of airfare sold. Then you buy ads which point to your affiliate link; if your affiliate payouts are greater than the cost of the ads, on average, you make the difference.

Some affiliate programs (like Amazon) don't allow this. Others are happy to allow it because it sort of outsources the work of figuring out how much to pay for ads. Instead of a company having to decide what to pay for e.g. Google AdWords, they just decide what percentage royalties they want to pay out for leads, and let third parties figure out how to bid on AdWords in a way that doesn't exceed that cost.

blhack• 15 years ago

Basically it's just being better at advertising for ['amazon','okcupid','ebay','zappos','etc.'] than they are.

I know that for a while, netflix was paying something like $40 or $20 or something really high for their trial membership signups.

So what affiliates will do is buy space advertising for netflix or whoever, hoping that the people that see their ads will sign up for the product.

As long as their cost to get somebody to sign up for netflix is less than what the affiliate is paying out, they make money.

Say my overall cost to get somebody to click my ad and sign up for netflix is..$16. If netflix pays me $20 for that, I make $4 every time.

Repeat that enough times, and you're making enormous amounts of money.

swalkergibson2• 15 years ago

This is a great story, and kudos to Max for being able to profit massively from it, but this type of thing always reminds me of day traders. For me, personally, it is not all that inspiring. Maybe I am being too altruistic, but it seems like instead of creating value, he is extracting value from other companies. Honestly, I would rather read stories about young people making 1/100 of what Max made, but instead of affiliate arbitrage, they are building their own product and hustling their own sales. Nonetheless, it is still an interesting read, and a way to make a quick buck if you are willing to put up some cash to get the traffic pumping.

r00fus• 15 years ago

Yes, it's a form of arbitrage, and decidedly unsexy. It's also potentially very lucrative.

AndrewWarner2• 15 years ago

Looks like he learned a lot from it and then moved on. Now he's running whatrunswhere.com, which does ad intelligence.

swalkergibson2• 15 years ago

That he does.

Truthfully, I would be interested in finding out how he sold his WhatRunsWhere product to all of those clients he has listed on his site. Like I said, the story leading up to this point in his life is good, but I would personally be more interested in hearing more about WhatRunsWhere, not so much about making $10K/day being a broker for diet products. That being said, if the ultimate goal is to make as much money as quickly as possible, this is one way to make that happen. However, by his own admission, he is a shining example of becoming disillusioned with making money just for the sake of making money.

veyron• 15 years ago

Does anyone remember AllAdvantage and BeFree from last decade? At that time it was cost per click ... :)

grecy• 15 years ago

Ahh - good 'ol AllAdvantage. My university room mates and I all signed up under each other, and all ran about 10 clients on our computers each night with a script to make the mouse move and click random things.

People thought we were nuts until the money started rolling in.

paulhauggis• 15 years ago

I thought it was pretty cool. I enjoy hearing about these things not because I want to get into affiliate marketing, but because I can use the same techniques to get people to my own products.

When you are playing both sides, your profits are much higher and more stable in the long-run.

I thought it was interesting that he mentioned "wickedfire.com". This is a known black-hat seo hangout and 99% of the things they mention on this forum are unethical and border-line illegal.

xmcp123• 15 years ago

/me waves

I'm the owner/the guy who wrote it. The guy in this interview is Max, the co-owner. I'm also a moderator on wickedfire. While I would disagree with your characterization of the forum, it would be odd if I didn't post there considering my position.

Burnt-Out At 20, Making $20K A Day - with Max Teitelbaum

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