I have been sharing with you about my success stories to inspire you. But I’m not invincible.
Success comes with a fair share of failure.
Today I’ll share with you an online business that I’ve created but failed.
I hope that you will not make the same mistake that I make.
In 2012, I became very interested in stock trading and technical analysis.
Since I was savvy in programming, I wrote algorithms to do backtesting.
I wrote a program to simulate trades based on different buy/sell signals. I wanted to find out if there was a sure win formula.
And I found it (well, I thought I’d found it).
Excited, I reckoned I had found another gold mine – a big one, because stock investment was a huge market.
I started to develop a stock trading membership site based on my sure-win formula.
It was a free membership site with an upgrade option. Free members can use different tools to analyze stocks, manage their portfolio and do backtesting on their own. Upgraded members can use my proprietary indicator that will show them when to buy and when to sell.
I advertised in Google Adwords to get traffic.
I also made a list of stock trading forums that accepted direct advertising. Advertising in stock trading forums wasn’t cheap. They ranged from $500 to $20000 a month.
In the first week of launch, after spending about $6000, I only enrolled about 200 members.
I thought that was okay. We had an affiliate program. Members would refer more members and the snowball effect would take place.
2 months passed. The member size hardly increased. There were a few upgrades, but they were not enough to cover the costly data and license fee.
I started writing blog posts, hoping to get some traffic from the search engines. But the traffic wasn’t enough to make a drastic difference to the business.
After 1 year, I closed the website.
Here are the lessons I have learnt from this failure:
1) Pick on someone your own size.
The stock trading industry was full of big boys with huge budget.
On one hand, everything was expensive in this industry. Advertising was expensive, stock data was expensive. Many things required licenses from the various stock exchanges.
On the other hand, many things were available free. For example, technical analysis was available free in Yahoo finance, Google finance etc.
No matter how much value I created, it was hard for me to stand out among the big boys.
2) Build a business around your true interest
I thought I was interested in the stock market niche, but I wasn’t.
What I was interested was programming and system creation.
Once the system was created, I realized that I lost interest in stock trading and technical analysis.