056: How JD Roth Started GetRichSlowly And Inspired A Personal Finance Blogging Revolution

JD Roth

Today’s interview is a very special to me because this person is someone who inspired me to start my own blog back in 2009. JD Roth is the founder of GetRichSlowly.org and he was one of my blogging idols early on.

Today, he writes at JDRoth.com and his blog is still one of the very few that I read on a regular basis. He’s an amazing writer and I love how he can make even mundane topics interesting through the power of storytelling. Enjoy the interview!

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What You’ll Learn

  • How JD Roth got the idea for GetRichSlowly.org
  • The key to creating a successful blog
  • Why JD ultimately decided to sell his website
  • Why you should get more personal with your content
  • The power of storytelling
  • Why SEO shouldn’t be your number one priority
  • How GetRichSlowly.org made its money

Other Resources And Books


You are listening to the My Wife Quit Her Job podcast, where I bring in successful bootstrapped business owners to teach us what strategies are working and what strategies are not. Now this isn’t one of those podcasts where we bring on famous entrepreneurs simply to celebrate their success. Instead I have them take us back to the beginning and delve deeply into the exact strategies they used early on to gain traction for their businesses.

Now if you enjoy this podcast please leave me a review on iTunes, and enter my podcast contest where I’m giving away free one on one business consults every single month. For more information, go to www.mywifequitherjob.com/contest. And if you are interested in starting your own online business, be sure to sign up for my free six day mini course where I’ll show you how my wife and I managed to make over 100k in profit in our first year of business. Go to www.mywifequitherjob.com for more information, now onto the show.

Welcome to the My Wife Quit Her Job podcast. We will teach you how to create a business that suits your lifestyle so you can spend more time with your family and focus on doing the things that you love. Here is your host Steve Chou.

Steve: Welcome to the My Wife Quit Her Job Podcast. Today I have a very special guest on the show J.D. Roth, now for as long as I’ve been blogging, I’ve always only followed a handful of personal finance blogs and especially getrichslowly.org created by none other than J.D. Now I actually met J.D. inside of a Super Shuttle on the way to FinCon and I have to admit when I first saw him in the back seat behind me I was kind of star struck.

Here was the father, actually not the father the grandfather of personal finance blogging in the same van as me and I was pleasantly surprised to find that J.D. was super cool and down to earth. Now J.D. later sold Get Rich Slowly for a nice seven-figure sum, stopped blogging for a while altogether, went back and then recently left to start his to start a different blog altogether. And what I really like about J.D. is that he writes from the soul and all these articles are super personal, engaging, and we can all learn a lot from him on how to create a loyal audience. And with that intro welcome to the show J.D., how are you doing today?

JD: Thanks Steve, I’m doing great.

Steve: I thought you’d enjoy that grandfather of personal finance.

JD: Well you know people kept calling me the Godfather, but I’m not the Godfather, Flexo or Luke from Consumerism Commentary. He’s the godfather of personal finance blogging,

Steve: Yeah he certainly is and what does that make Jim then?

JD: Oh that’s a great question. We’ve got to come up with the name for him.

Steve: I don’t think he has a nickname yet, I’ll have to give him one.

JD: He’s like a mastermind.

Steve: The mastermind.

JD: Yeah.

Steve: So J.D. give us a quick background story about GRS and just take us way back to when GRS got started.

JD: Sure, so I would say there is a lot of different threads that combined to lead to Get Rich Slowly and in retrospect this seems pretty clear that I was destined to start something like that, but I could never have predicted it. So I went through college, I got a psychology degree and while I was getting a psychology degree, I was also getting myself deep in debt, and not like student loans like a lot of people who go to college, but I was racking up debt in the form of credit cards. I graduated from college with a credit card habit. That credit habit just got worse as I as time went on.

Also this time I like writing I’ve always been a writer ever since I was in grade school, and so all these things are coming together, I got on the web the early days of the web. I had a web journal before it was called the blog; we used to call them web journals. And all of these things just kind of gradually let up so that in 2004, my then wife and I bought a new house, and on paper we could afford the house but in reality when we purchased it I felt like I was just drowning in debt because I had over $35000 in consumer debt. All of a sudden we’re taking on this new mortgage and is all sorts of work that needs to be done to this house, because it’s 100 year old house, and I just felt like I was really-really struggling.

Around this time some friends recognized that I was in need of help and so they recommended a couple of books, including Dave Ramsey’s Total Money makeover, and Your Money or Your Life by Joe Dominguez and Vicki Robin. And I read these books, I thought oh it kind of makes sense of and then I read some more books that I borrowed from a library and eventually I realized that there seems to be some common themes in these books. In one of the book one of the themes was that although there was no reliable way to get rich quickly, there were ways that people could get rich slowly.

And that so I wrote about this idea that you can get rich slowly, I wrote about this on my personal site Folded Space. And after I wrote about this for whatever reason, a lot of people liked what I had written, and it gave me this idea, maybe I can start a blog about personal finance. I thought it would be the first blog about personal finance. It turns out there were already some out there, including Consumerism Commentary from the Godfather Flexo.

And so I started Get Rich Slowly, I started to share my progress with money. I thought I can improve my own situation and maybe help other people improve theirs. And as just kind of an afterthought I put some ads on it because I thought maybe I can make some money along the way. And little did I know that this whole project would change my life in all sorts of ways, including financially.

Steve: So just curious when you first started writing, was the intention to make money or was it just more like a journal?

JD: Well, it wasn’t strictly a journal; I mean my personal site was more like a journal. Get Rich Slowly was definitely it was a way for me to hash out what I was learning about money. And so I gave my three goals where number one, improve my own situation and number two, to improve and to help other people improve their situations. And I definitely did start out with the intent to make money, but I thought maybe I would make $100 a month or $200 a month, just a little bit of money to help me get out of debt more quickly. I had no idea that it would become a business.

Steve: Okay and then you know when you were– you’re not a technical person are you J.D.?

JD: Moderately, I mean…

Steve: Moderately, okay.

JD: At one time I thought I was going to become a computer programmer, so I actually got a couple of gigs doing programming but…

Steve: Okay, and so in terms of putting up the website that wasn’t really a big deal for you, and did you invest a lot of money into this blog early on?

JD: No-no-no-no.

Steve: Okay.

JD: No way at all.

Steve: Okay.

JD: At first everything was hand coded back in the early days back when I said I had a web journal. I was hand coding my website. I say that my…

Steve: Oh okay.

JD: My current skills with web design are very 1998 because that’s just kind of where the flow is. I was on the cutting-edge in 1998 but never developed beyond that. So when it came to Get Rich Slowly, I used a standard WordPress out of the box theme. I adjusted a little bit, I flipped the header image I remember I thought it was pretty hilarious for doing that. And it was kind of an abstract thing so nobody could tell, and then I made some modifications with– I never made like heavy modifications.

Steve: Okay, now I was just curious for my own knowledge and…

JD: Yeah.

Steve: You know one thing that kind of drew me to GRS was just the quality of the content, like if you looked at some of the other personal finance blogs it was just more generic material, but everything with yours; it had a lot of depth to it. So I just wanted to ask a little bit about your content strategy early on, is it something that was deliberate in the way you were writing or…

JD: Well, I would say it was intentional. I don’t know whether deliberate is the right word, but I think calling it a strategy really overstates it.

Steve: Okay.

JD: I was just writing the way I write, I was just writing the way I talk. I was being natural. To me as you know, I’m a strong believer in story and the power of story, and so I don’t like, I know that when I go to websites or read books or magazine articles I don’t like the old dry stuff, so why do I want to produce that? I want to produce the kind of material that I would want to read and so that means putting some personality into it, talking about my cats, talking about my ex-wife and I we had a garden.

So I had an ongoing series where every summer, I would chronicle how we were doing with our garden and whether we were making money with the garden and so on. For a long time I talked about how I wanted to buy a mini cooper, I had this thing I really wanted my mini cooper, and so little touches like that made the site more personal I think.

Steve: I just have a question about that eventually you sold GRS.

JD: Yeah.

Steve: So does writing in such a personal fashion affect the sellability of a site?

JD: Well it did to a degree, and when I sold the site, the people who were talking to me about buying it– this is one of the concerns they did have. And so as part of the purchase agreement what they wanted was for me to stick around for three years, they wanted to write a contract where I would stick around for three years…

Steve: Okay.

JD: So that it would be a gradual transition, and at the time that I sold it though I wanted out, I was done I thought, and so I turned that down. So they went back to the drawing board making back and they offered me 30% less and I could walk away. Now the ironic thing about all this is, I stuck around for the three years after all, I turned out I couldn’t tear myself away, I was so devoted to the site that I stuck around and I edited it, and I wrote for it and managed it. And so I shouldn’t have turned down that first offer.

Steve: Right, yeah who would have known?

JD: Yeah you make the best decisions you can with the information you have at the time.

Steve: So I’m just curious though if you were to give advice to someone starting their own blog today, would you still advice them to be a lot more personal about it?

JD: Yeah oh…

Steve: Okay.

JD: Absolutely.

Steve: Okay.

JD: I feel like today– when I look at not just personal finance blogs but a lot of other blogs that are started today, so many of the sites are generic and they could be written by anyone. And so where’s the incentive for anybody to come back to that site? But on the other hand, if you look at the sites that seem to be successful, the new sites I think of somebody like Mr. Money Mustache and his site is relatively new.

And when he started it, it was at a time where people were saying well, nobody can have the same kind of success that Jim and J.D. and Flexo had because they started at the beginning. And yet you look at what Mr. Money Mustache has been able to do, he absolutely has had that total success, if not more so. And it’s because he’s been personal, he has a distinct style, and I think there are other people who are able to do this kind of thing too.

Steve: Okay and the only reason why I asked is you know I look at a whole bunch of different blogs and some of them are just like these blogs with a whole bunch of different authors and different personalities, but a lot of this stuff is on the more generic side, yet it still does pretty well.

JD: Of course.

Steve: And so I was just wondering what your opinion on you know going that route is as opposed to just going completely personal, like the way you and Mr. Money Mustache has proceeded.

JD: I don’t think there is anything wrong with that. I think it’s a set of different set of challenges. In some ways you make your content more accessible to everybody, and yet at the same time I think it’s like less interesting if that makes sense.

Steve: Yeah.

JD: It is like going to read just generic Wikipedia entry on a Roth IRA instead of a story from somebody…

Steve: Right.

JD: Writing about how they’ve done a Roth IRA.

Steve: Yeah no, I completely agree with you. I was just kind of curious why some of those sites are actually successful, like I’d much rather read a story based site like what you were saying that’s very personal. And you know it is just interesting to note that, so if you were to do it all over again you would not have changed anything in the way that you proceeded with GRS.

JD: No, absolutely not.

Steve: Okay.

JD: And you know I tried to have a balance, I think it’s important to note that not every article was a story based article. My story and my life formed the backbone of the site, and I shared any time something new or interesting happened I would share that. But at the same time, I would say most articles were actually spurred by something else that I’d read online.

So maybe I’ve gone to the money magazine website and they have an article on something, maybe I agreed with it or maybe I disagreed with it. And so I would quote a little bit from that article, the one that spurred my– whatever train of thought I had and then I will offer my own feedback to the article, either expanding on what was said or contradicting what they said, and so that’s how most of the articles at Get Rich Slowly worked.

Steve: Okay.

JD: They retained a personal voice, but they were often responses to other things that were out there on the web. And then there’s like a third type of article where it was just like purely informational, like How to start a Roth IRA, or which savings account is best and so on.

Steve: Okay and you know assuming that the content is good and was good, you know what was kind of your early strategy to obtain traffic?

JD: Again strategy implies much more than what I had. So I was very fortunate to have been around on the web from the early days of the web, and in fact I had also some online connections from even before the web came to existence from news groups and so on. And as time developed I participated in communities. There were different communities online, comic book communities, or movie serial communities, just different communities that I was a member of.

And so when I started Get Rich Slowly I’d shared this not like in a spammy sort of way, but I just like oh yeah you guys shared the comic book place forum, I just started this site and I wrote about how much I’m spending on comic books ha-ha-ha-ha, and I never thought oh I’m intentionally sharing this to try to get traffic. But the result is because I had these existing connections, and because I shared the site with the people in my personal life and there is another difference, a lot of people nowadays are anonymous bloggers, where as I was not anonymous in anyway and I share with a lot of people.

Steve: Right, yes.

JD: And by sharing with as many people as possible, I picked up some readers and some influential readers who started sharing the site in other places. For example Life Hacker, one of the editors at Life Hacker was an early reader of Get Rich Slowly, and so she would share articles around.

Steve: Okay and then in terms of– let’s say you had to start all over again, how would you proceed, you know in the present day?

JD: That’s a great question, Jim and Flexo and I have talked about this quite a bit actually because obviously we know a whole lot more than we did when we started. And obviously the whole ecosystem has changed, but at the same time I don’t think I could change much because it would be untrue to who I am.

Often at conferences I downplay the role of SEO and I really think that search engine optimization– I think too many people look at that as a primary or secondary method of obtaining traffic and success, and I would argue that it ought not be a primary or secondary concern, it should be a side effect. You should do all of the other things, provide great content, tell good stories, and do things and services to the readers first and the SEO is a byproduct or something that you go to when you don’t have anything else to do, then you look at the SEO and it’s like one of the last things you think of and not the first.

Steve: Okay and then in terms of GRS, Get Rich Slowly’s traffic, was it mostly search or was it mostly direct and recurring traffic?

JD: That’s a great question. I looked at it recently and told somebody the answer and I forget what it was to be honest, it was a large percentage was recurring traffic, like direct referral type stuff.

Steve: Okay.

JD: There is still plenty that was search based, but it was less so than most sites.

Steve: The reason why I’m asking you this is because and we’re going to probably get into this little bit later, but in terms of making money. A lot of times the search customers are the best customers in terms of a monetary standpoint.

JD: Yeah.

Steve: And so it’s funny when you said that SEO should not be even the primary or secondary form of traffic that you should be focusing on, but so how do you kind of balance the monetary aspects with you know your own personal style?

JD: What I would argue is that the best SEO is a well written article because what happens when you have an article that people want to read and want to share, is that they do share it on other websites and it gets linked around. And so you could spend hours optimizing your keywords in a specific article on Roth IRAs to try and get traffic for Roth IRAs, but if somebody else goes along and writes a long story about how they set up their Roth IRA– I don’t know how you would actually make that interesting– this is just but– and it gets shared around at Reddit or on Facebook or at Life Hacker two.

All of these links back totally overpower your keyword optimization because this other person has managed to get high quality links and many of them, and so– now I’ve lost the track of what your original question was, but I feel like doing– following my method you do get SEO benefits, but it’s a different type of SEO if that makes sense. And another thing I would argue is if you build a large following and a huge number of readers, you end up getting a lot more search traffic too than you might think.

Steve: Okay, so let me just kind of rephrase that question a little bit.

JD: Yeah.

Steve: So instead of focusing directly on SEO, so what do you focus on? So outside the content, let’s say the content is great in terms of social media, e-mail like what would you advise people to focus on?

JD: Well, that’s a great question Steve. For me I recognize that some of the things that I don’t do there’s actually value in it. I’m not very good with social media, you and I talked before you started recording about how I’m a very poor marketer. I don’t like marketing, I hate it in fact, I hate self promotion. And as a result, I don’t do a lot with social media that I could do and I know that…

Steve: Okay.

JD: Some of my colleagues and friends are very successful with social media, and you also mentioned e-mail lists. I know from talking with some of my friends and colleagues like Ramit Sethi from “I Will Teach You to Be Rich” and Chris Guillebeau from The Arts of Non-Conformity, these people prize their e-mail lists very highly, and they nurture them, they grow them and they protect them. And it’s because– you talked about search traffic being a source of income, well these people believe that the e-mail lists are actually the greatest source of income.

Steve: I would tend to agree with them.

JD: Yeah.

Steve: So…

JD: I’ve never done anything to try market to an email list, and yet I recognize that people that I respect highly praise their value.

Steve: It’s interesting because you know the way Get Rich Slowly kind of evolved was pretty much– it sounds like through just straight word of mouth and through the power of the content, is that…?

JD: Yeah that’s the impression I get, I mean I didn’t do any kind of marketing, I didn’t do any kind of search engine optimization, it was just by being shared around.

Steve: Okay and what was the business model exactly and how did how did it make money?

JD: Okay that’s a question I can answer and then we’ll have– I want to point out that there’s– before I answer it directly, I want to point out that there’s no one right way to build a blog. There’s no one right way to make money online. There all sorts of different strategies that work and you’ve got– your listeners have to find the strategies that best fit their particular– I don’t know method or personality or whatever it is. And so the same is true with advertising or making money from the website directly. In my case, I very much followed the traditional magazine type of monetization and by that I mean I have the content and around the content were ads– were display ads and…

Steve: Okay.

JD: Those were Google ads, they were banner ads that people paid me directly for, and it was only after a couple of years that I came to understand the power of affiliate ads. I didn’t– it was Jim Wang actually, he told me at the very first blogging get together that I ever went to in San Francisco. He’s like JD, how come you have not monetized your savings account page? I was like I don’t know what you mean, and so he said well you can do these affiliate programs and you’ll get paid every time somebody signs up for a savings account. I was like oh all right, I’ll try it.

It totally revolutionized my model and but nowadays I’ve also seen that there are people who like Remit initially, with I Will Teach You To Be Rich, he used the site more as an advertisement for himself. He didn’t monetize the site directly, but he was trying to promote himself to get speaking gigs, and then to sell his print books. And nowadays, he uses it to promote his courses.

And Chris Guillebeau has used his site to market e-books and other products, and I’ve had a little bit of taste of that because my latest project, which we don’t have to go into much depth but I’m happy to talk about, is a course that I did for Chris Guillebeau about personal finance. And so that was the first time I’d done any really non-traditional type income strategy I guess.

Steve: This is all really interesting because you know I had Jim Wang on the show earlier.

JD: Yeah.

Steve: And his strategy for monetizing his blog was to rank for specific search terms and then go through affiliate offers, and it’s just interesting hearing both your perspectives, different perspectives on how to monetize a blog I guess, so…

JD: Well, and that’s why Jim and Flexo and I we’ve talked the three of us at some point opt to form a partnership because we each have very different skill sets. And yet we work well together, we know each other, we trust each other, and I suck at the whole search engine optimization stuff. I don’t like it, Jim is good at it, he likes it, so if we worked in a partnership that could be his focus, I could focus on creating some content. It’s an interesting thing, but we don’t have any kind of firm plant, but we’ve definitely talked about it.

Steve: Yeah I mean Jim is really good at optimizing something to death.

JD: Yes.

Steve: And extracting every last dollar out of something I think and yeah your content is awesome.

JD: Thanks.

Steve: I mean you’re just a natural writer.

JD: Thank you.

Steve: So let’s talk a little bit about some of the challenges early on in the early phases of Get Rich Slowly.

JD: Okay.

Steve: How does one get those advertising placements? How does one get those affiliate offers and get them to actually convert?

JD: Well, I don’t know if I’m going to have any useful information for you on this particular topic. For me again I started with the Google ads and anyone can get AdSense or at least I think…

Steve: Sure.

JD: Anyone can get AdSense, it’s not necessarily going to convert, but if you have enough traffic, especially on particular pages, you will make some income. Eventually, I had people approach me directly and offer display ads.

Steve: Okay.

JD: So figuring out how much to charge was a very difficult thing for me. I didn’t know I mean this is still back in earlyish days and you kind of had to feel things out. I would suspect that even today people had to fill things out. You don’t want to charge so much that you scare off advertisers, but on the other hand if you don’t charge enough you’ll leave money on the table. And so figuring out what people are willing to pay is a very important thing. With the affiliate offers I know that nowadays the market has changed somewhat. I hear about people all the time who are being dropped from programs.

Steve: Yes.

JD: Because they don’t convert enough. And so that’s actually an interesting challenge and I don’t know– I feel like if that’s happening to you and your monetization strategy is to use affiliate programs but you don’t have enough traffic, well then you’ve got to find ways to build traffic. You’ve got to change your focus for a while and maybe not focus on the affiliate program. Get rid of them altogether and instead focus on something else until your site has enough traffic that you can say, hey let me try it again.

Steve: Well let me ask you this you mentioned that Jim came to you and said, hey how come you are not monetizing your savings account article.

JD: Right.

Steve: What did you change to– did you just throw an affiliate link at the end?

JD: Yeah.

Steve: And that was it– okay.

JD: So what I had– the way the savings account article was structured in 2007, 2008 it was just– it was no more than me asking which online savings account is best. Our online [Inaudible] [00:27:32] savings account is best. And it was an honest question, I didn’t– I wasn’t thinking about SEO or anything. I was asking my readers because I didn’t have an online savings account. And I said okay I’m thinking about getting one, here are some of the ones I found and the rates they have. And back in 2007, 2008 rates were higher, and what you think of these accounts and which ones do you guys prefer?

And I had no links to start with. All I had was the information about their interest rates and links– well I had links to the sites but they weren’t affiliate links. And I got hundreds of comments; I got all sorts of traffic from that. And so about a year later was when Jim recommended that I add the affiliate links and I did, and they were just simple affiliate links for whatever programs I could find. And I didn’t do anything else other than that.

Steve: No that makes– I mean just the topic of that article just kind of lends very naturally to affiliate marketing actually.

JD: Yeah.

Steve: And it sounds like it wasn’t intentional.

JD: No it wasn’t.

Steve: Okay.

JD: And even when I added the links I didn’t put up banner ads or anything like that. I just put the links on the– well for each individual account itself. Now one thing I will say Steve is even though I was never good at the advertising, I was pretty savvy about when I saw that I was getting an influx of traffic from some place I would quickly go add a line or two to my article at the bottom saying, hey if you like this you should sign up for my RSS feed or my email.

And I don’t remember exactly how I did it; I don’t know if there are still there the company that bought me recently might have taken the– these few line tags of these articles. But they were very effective in creating or capturing a lot of new readers. So whenever I saw somebody that was getting a lot of traffic for a particular article, I would add that so that I could try to recruit new regular readers.

Steve: That’s actually a really good tip; I mean I think everyone should just go through their analytics to find out which pages are gaining the most traffic. See if you can add a sign up form, or see if you can add an affiliate link that’s kind of related to that high traffic article.

JD: Yeah absolutely. I don’t do– I’ve said that I don’t do SEO and I don’t do the marketing very well, but one thing I did once I realized that oh certain pages get more traffic, is I went through and I tried to figure out how I could monetize these individual pages in order to obtain more traffic. Now you recently had Toni from the Happy Housewife on, and she stole one of my top pages. It doesn’t bother me now that I don’t have an active role in Get Rich Slowly, and I never really had a chance to monetize it and I’m not sure how I would have monetized it, but it was about do it yourself Christmas guess.

And that was one of the last articles I wrote before I sold the site. And it didn’t have a lot of traffic the first year, but the second year the year after I sold the site it was a– I got a huge traffic push from that particular article. And I suggested to the company that bought the site that they should do something to monetize that page and they never did. But Toni I think I mentioned it to Toni and she said, well fine I’ll take care of it. So sure enough she built the page, took over the ranking for that word, gets lots of traffic, and I don’t actually know what she’s done to monetize it, but I think she was very savvy in doing that.

Steve: You know it’s funny J.D. you know just based on talking to you, it sound like your overall strategy is to just put out the best more shareable content possible. Eventually you know it will get shared around and it’ll start getting traffic, it will start ranking just naturally and then go back, find out what’s performing well, and then just monetize based on your highest traffic pages, right?

JD: Yeah, I have never like actually articulated it in that way but yes, that’s exactly how I go about it, or how I would go about it if I were actively trying to run a blog as a business right now.

Steve: Yeah and I think the key from talking to you is you know focus on creating really good shareable content. And then the rest will just kind of take or care for itself over time.

JD: Yeah.

Steve: And you know what you said about SEO is totally true with my blog. I had articles that I had written in the past. It took like a year maybe a year and half to start ranking, but once it starts ranking the traffic just starts pouring in.

JD: Yeah. And another thing I would say is I feel like everything you do with your website, with your blog should be in service of the reader. Anything that is not in service of the reader is going to actively discourage people from returning to your site. And so you have to walk a fine line because ads are obviously not in service of the reader. On the other hand certain ads can be. So like when I’m adding affiliate links– okay the affiliate links don’t help anybody besides me and the bank I guess. But if the reader is going to go and follow those links– anyhow I don’t have an issue with it.

The same thing with like referring people to Amazon even at my personal site today I’m always linking to Amazon. I just did it this morning, sharing about the different equipment I’m buying so that I can learn how to do video podcasts. And so I feel like– yes create shareable content and also try to structure your site so that it’s very reader friendly. So that it’s– the things you are doing don’t frustrate people and make them want to go away.

Steve: So what’s your view on AdSense then, just then curious then?

JD: I don’t hate ads and I don’t love it. To me it’s like a necessary evil in a way. I just removed it from my own site recently but my personal site right now does not generate a lot of income, so it’s not a big deal.

Steve: Right okay. Hey I was hoping we could talk about the sale a little bit.

JD: Sure.

Steve: You mentioned that when you were ready to sell Get Rich Slowly you were just done with it. So what were your motivations?

JD: Well I had a few motivations going on. First of all the site had been creating more and more income. It had gone from being– when I first started the site it generated a few bucks a day and then bumped up to being a few hundred dollars a month. And then eventually it was a few thousand dollars a month, so that about two years into it I was able to quit my day job to focus on the blog full time.

Then I– both my lawyer and my accountant and my wife, they asked me to stop sharing my incomes stuff, so I did. But the income continued to grow and grow, until toward the end I’m not allowed to say exactly how much I was earning, but I could say that I was earning more and more in one month from the site than I used to earn in a year from my job.

Steve: Wow.

JD: And this was towards the end of 2008, beginning of 2009. And if you’ll remember that’s right around when the economy crushed. And although my revenue continued to climb and climb and climb, I felt like I could see the writing on the wall. I felt like interest rates were beginning to drop, and I figured if interest rates were going to drop then people would sign up for fewer savings accounts, they would have– I only recently began to put credit card out on the site, and I figured well if people are having problems paying their debts, there are going to be fewer people interested in credit cards.

The bottom line is financially I thought now is a good time to sell. I’m making a lot more than I ever have and I feel like the economy is crushing.

Steve: Okay.

JD: Plus at the same time there was stuff going on my personal life. I was beginning to have doubts about my marriage, and I felt like this was taking too much time away from that. My best friend committed suicide which is something that I shared on the site. And there was just a whole lot of stuff going on that was making me want to get out of there.

Steve: Okay.

JD: I was unhappy. And so I had been ignoring people who would approach me and say oh I want to buy your site, I thought they were joking. I made a resolution at the beginning of 2009 that instead of ignoring these people I would listen to what they had to say. And eventually I realized, oh they were serious and in fact they were very-very serious and are willing to offer a lot of money.

Steve: So did you actually go out to find your ultimate buyer or did they find you?

JD: How did this work? So before the sale, I had one company– let’s call them company A approach me and said, hey we want to look at your site or we want to buy it. And I was like, okay how much do you offer? And they said, well we don’t know, we need to see your financial statements. And so I asked my attorney and my accountant should I show them, and they said of course they don’t have any other way to make an offer unless they see your stuff. So company A took a look at the financial statement and while they were doing this I decided I would get some advice.

And I went out and I did some searches to find people who had sold sites before. And I contacted a couple and I asked them how things had gone. And they said, well you know you should really hire an investment banker if you are serious. And I thought, well okay. So company A came back with an offer and it was a big number. It was a little bit bigger than what I thought would be my walk away number. And I was like, all right I’ll check with an investment banker.

And the investment banker said, you know you’ve already done a great job. You’ve got more out of it than we thought you could get, but we still think you should let us take it to other companies. And I said, all right well maybe one more. So they took it to company B and company B came back and made a better offer, and I ultimately sold to company B.

Steve: Okay and how did you determine what a fair offer was? Like what were the multiples– what’s the reasonable multiple for a blog at that time?

JD: Oh let’s see, there was a banking blog that sold for like 10 times…

Steve: Yes I remember. I can’t remember what it’s called right now but yeah.

JD: No I can’t either, but I thought that was unreasonable. And from talking to other people when I was waiting for company A’s offer to come in, I talked to other people and I decided that maybe three to five times earnings will be reasonable. And that’s right in line with like a standard valuation for a brick and mortar business.

Steve: Okay.

JD: And it might be a little bit higher, I think brick and mortar business is probably three times earnings. And so I decided based on trailing 12 month revenues what I looked at. So just kind of a rolling number that wasn’t your last 12 months of revenue. I decided– I think it was about five times– no three times is what I wanted Steve.

Steve: Okay.

JD: And so when company A came back with four times, and so I thought, oh well that’s perfectly reasonable.

Steve: Wow, okay and so it sounds like it’s just kind of naturally happened, people were coming to you, you just do a little bit of due diligence, figured out what your number was essentially and…

JD: Yeah. I mean there was a lot of work behind the scenes because I was calling everybody I could to ask information. I have somebody I consider a mentor who is– he teaches business classes here in Portland. And so I called him and talked to him, and he went through all sorts of stuff with me. And things like get as much of the money upfront as you can, and all these other things. And it was very interesting.

Steve: You know I know most people don’t have lawyers and accountants on retainer, did you have one on retainer or did you just get one for this?

JD: No, I’m very fortunate in that my best friend from grade school is my attorney and one of my best friends now is my accountant. They still charge me a lot of money, don’t get me wrong. I’m able to just contact them and say, hey this is what is going on and take them out to lunch and they allow me to pick their brains.

Steve: Okay. And I didn’t want to get too much into this, but in terms of just the terms of the sale, can you just briefly highlight what some of the different options were? You said get as much money upfront?

JD: Yeah.

Steve: What would be some of the other aspects of the deal where you wouldn’t get money upfront?

JD: Okay, so when you sell a company or a large asset, you don’t get paid all at once, it’s kind of a buyout. And so different– when somebody buys asset and in this case they bought an asset rather than a company, they bought the website. So it could have been structured so that they pay me very little upfront and then there was an earn out over a period of time…

Steve: Okay.

JD: Or what I pushed for was to get as much– actually the investment bankers were the ones who did the negotiating. We tried to get as much money upfront and a smaller payout in the long term. And I think we probably got less money because of that because obviously money loses its value a little bit in time. So and plus if you are asking for a lot upfront they are going to be less willing to part with it, but that’s how we structured it.

Steve: Okay and then in terms of the investment banker, do you recommend going with one and what percentage do they take?

JD: I can’t remember exactly– our deal was a little different because I had already done so much of leg work by the time they got involved.

Steve: Okay.

JD: But my guess is right around 10%. I don’t have the numbers of the top of my head Steve.

Steve: No that’s okay, just a ball park is fine, okay.

JD: Yeah and ball park is I think 5 to 10% is what– it’s basically like selling a house.

Steve: Okay.

JD: And you want– excuse me, you want somebody there who knows the ins and outs, unless you’ve done it a number of times before. And so it was very handy to have them. I felt protected, I felt like they were looking out for my best interest.

Steve: Okay. And I’m going to make you feel a little bit uncomfortable now.

JD: Go ahead.

Steve: And I’m going to ask you about your course.

JD: Yeah, all right.

Steve: Because I know you are not a marketer.

JD: Right.

Steve: You don’t like pushing anything. So you know I thought I’d just get it out of you somehow. But you know these days you know you are not affiliated with Get Rich Slowly anymore. You have your own blog at, was it– you told me…

JD: It’s Jdroth.com is the URL.

Steve: Okay.

JD: But I call it folded space which is what I called my blog 10, 15 years ago.

Steve: Okay. And you recently started dabbling in info products, right?

JD: Yes.

Steve: So let’s talk about your latest info products.

JD: Okay so I met mentioned before I’m friends with Chris Guillebeau who runs The Art of Non-Conformity. He’s written a number of books like The Happiness of Pursuit and $100 Startup. He is the prime force behind the World Domination Summit here in Portland which I’ve worked and done him– I worked on with him. So he suggested over a year ago now that he is like J.D. you know I have this series of courses– he calls them Unconventional Guides. So it’s like the Unconventional Guide to travel, or the Unconventional Guide to publishing. He is like I want to do an Unconventional Guide to Money, and I want you to write it.

And so we collaborated and he provided the marketing arm and the design and all that, and I spent several months putting together this Get Rich Slowly course which is a year-long course. It’s basically a series of weekly emails, but to me the part I’m proudest of is the guide. It’s this 120 page book really that contains my– it basically boils down my entire personal finance philosophy into a 120 pages. And I framed it in terms of managing your personal finances like a business would manage their finances. I say I want people to be the chief financial officer of their own lives. And to be honest Steve I’m really-really proud of this guide because I feel like it’s the best work I’ve ever done.

Steve: Wow, you know what’s funny is you don’t call yourself a marketer and you know I would definitely not call you a marketer, but it’s just you naturally market your stuff through your passion if you know what I mean.

JD: Yeah.

Steve: So it’s not intentional and you don’t have any ulterior motives. It’s just the way you present things is just– it’s just kind of naturally lands to being sold.

JD: Right and you know that’s actually another thing that’s kind of hard when it comes to marketing the course, because I am proud of it and I do want to share it with people, but I don’t need the money. Through the sale of Get Rich Slowly and careful management of the money that I got from that, I don’t need any more money. And so I’m not going to argue with earning more money, but it makes– I’m not motivated to market I guess than I would be if I weren’t in this position.

Steve: Sure I’ll be sure to link up this course in the show notes, but you know outside of your course are there any books that you’ve kind of read that have really influenced your way of thinking over the years?

JD: Yeah you know the funny thing is I often say that the best personal finance books aren’t about personal finance, and I mean that. So I guess– here is what I mean, so there is a book written by a guy named George Leonard and the book is called Mastery, and to me this is the best book that anybody who is trying to get out of debt can read. It talks about– he frames it in terms of trying to master martial art. And he talks about how you have to go from beginner and you have to just put in the work. And you have to struggle with getting better and then kind of losing some progress, and then getting better and then losing some progress.

And so this book Mastery is a great book for people who are trying to get out of debt or accomplish anything difficult. There is another book that I really like; it’s called The Magic of Thinking Big by David Schwartz. And it’s a book– it’s a very– it’s from the early 1960s, and it’s kind of got a very mad men type style in a way. It’s got some old fashioned language, but it’s a great book about positive thinking, setting goals, overcoming fear, and just doing the things you want to do. And it seems hawky [ph] at first but it’s a fantastic book.

Steve: Interesting.

JD: But perhaps I think the most influential book I’ve ever read is a book called How I Found Freedom in an UnFree World, and it’s by a guy named Harry Browne. Now Harry Browne is best known for being the Libertarian candidate for president in 1996 and 2000, but I don’t think people should hold that against him. This book was written in the early 1970s and how I Found Freedom in an UnFree World, it’s all about letting go of what other people think of you, what you think other people think of you, and instead of trying to live up to other people’s expectations, just live life on your own terms. And it seems so tride and so hawky, and yet presented the way he presents it, it’s just fantastic, I love the book.

Steve: Okay, I’ll definitely have to check that one out. I haven’t actually heard of any of the three books that you mentioned. So it’s actually– yeah it’s good for me. Yeah you know usually people talk about The Lean Start Up, or The 4 Hour work Week, and it’s kind of refreshing to hear three fresh new books.

JD: Yeah, I think Mastery is probably the most obscure of those and the Magic of Thinking Big is the least obscure that was a huge best seller.

Steve: Cool.

JD: You’ll find copies in any like thrift store.

Steve: So J.D. you know we’ve been talking for quite a while. You know if anyone wants to get a hold of you, where can they find you?

JD: Well my personal site right now is Jdroth.com. The blog is called Folded Space. And I have been writing a lot about overcoming fear, finding happiness, pursuing freedom. And more and more I’m prepping for my big project in 2015, which is going to be travelling around the United States and interviewing people about their lives and talking about their personal finance stories too. And so I’m kind of in transition phase there, and The Get Rich Slowly course, the year-long Get Rich Slowly Course lives at Moneytoolbox.com.

Steve: Okay. You know travelling around the US sounds like something Chris Guillebeau would do.

JD: Yes-yes-yes, but Chris is– you and I talked before the show about how I used to be a very strong introvert, and Chris is very much that. And he does travel around and he does meet people, but I think it’s tough, I think it takes a toll on him. And for me I’m going to be intentionally an extrovert and my goal is to get out there and meet as many people as possible. And to listen to what they have to say about their life experience, what have they found about purpose and passion and happiness, and probably about personal finance too.

Steve: That sounds like a really cool project. I will have to link that up too once you get the website up for that.

JD: Yeah. It’s a few months away, but it’s definitely in the works.

Steve: Okay, anyway J.D. thanks for coming on the show, a real pleasure talking to you today.

JD: It was great Steve, thanks so much.

Steve: All right take care.

Hope you enjoyed that episode. I have been a huge fan of J.D. Roth for as long as I can remember. And to be honest I’m still kind of giddy that I got to interview the grandfather of personal finance blogging.

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2 thoughts on “056: How JD Roth Started GetRichSlowly And Inspired A Personal Finance Blogging Revolution”

  1. Russell Lobo says:

    Super post Steve. And its amazing to see how humble JD is 🙂

  2. Gen Y Finance Guy says:

    Really enjoyed this interview, especially as I build my own personal finance blog and try to prioritize what to work on.

    I decided from the beginning that SEO would be the last thing I focused on. It has been more important for me to work on putting out really good content on a regular basis.

    Also being really active in the community as a strategy to drive traffic back to my site.


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