SEO is the Perfect Example of Compound Interest


2 min read

I make money on the internet by writing articles that people want to read.

This entire business model can be simplified into the following steps:

1. Find a good keyword to write about.

  • A “keyword” is any word or phrase that someone can type in Google. Examples include “best dog food for small dogs”, “how to tie a tie”, “how much house can I afford”, “best ski resort in Colorado”, etc.
  • A “good” keyword is one that a lot of people are searching for on Google, yet few websites are writing about.

2. Write the most helpful article possible about that keyword.

3. Repeat this process hundreds or thousands of times for different keywords.

Once I write articles, I earn money from them by placing ads, affiliate links, and my own digital products within them.

This general process is known as SEO, which is short for search engine optimization. It’s the process of writing articles that are optimized to appear at the top of search engine results.

The most magical part about earning income this way is that it follows a path of compound interest.

Why SEO Leads to Compound Interest

To understand why SEO leads to compounding income growth, I’ll share some actual stats from one of my websites. That particular site is monetized mostly with Mediavine ads, which earn about $20 per 1,000 sessions.

I currently have about 500 articles on that site which receive about 300 sessions per month, on average. Some receive 4,000+ sessions and others only receive 50, but on average they bring in 300 per month.

Some basic math reveals that the site earns about $3,000 per month purely from ads:

Monthly income = 500 articles * 300 sessions * ($20/1,000 sessions) = $3,000

Now, if I simply wrote another 500 articles and doubled the total content on the site, I could get to $6,000 per month in ads:

Monthly income = 1,000 articles * 300 sessions * ($20/1,000 sessions) = $6,000

However, SEO is actually even more magical than this because over time my domain authority will increase which means I can begin to rank on the front page of Google for more competitive keywords that offer even higher search volume. 

This means that my average number of sessions per month from each article should actually increase over time. For example, my average sessions will likely reach 400 per month, which would boost my income even more:

Monthly income = 1,000 articles * 400 sessions * ($20/1,000 sessions) = $8,000

And eventually it could easily reach an average of 500 per month:

Monthly income = 1,000 articles * 500 sessions * ($20/1,000 sessions) = $10,000

And keep in mind that this is only income from ads. As my total monthly traffic increases, my income from digital products and affiliate links should increase as well.

Why SEO Isn’t a More Common Path to Wealth

The math that explains why SEO leads to compounding income growth is straightforward to understand, but there are two reasons why most people don’t use it to build wealth:

1. You typically won’t earn a dime during the first six months. It takes several months for Google to start showing new sites love in the search results. In fact, most new websites won’t earn any money during their first six months of existence, no matter how amazing their articles are. Most people don’t embrace SEO because it requires massive patience, a trait that very few people have nowadays.

2. Compound interest is not intuitive. Plenty of people start websites and stick with it for a few months or maybe even a year, but most quit because they can’t envision compound growth.

As an example, the following chart shows my monthly online income since I started dabbling with websites back in January of 2017:

During my first 18 months I basically had no clue what I was doing, but once I learned about SEO in late 2018 I began writing SEO-optimized articles more consistently. My income journey has been bumpy, but in the past 6 months I’ve earned as much as I did during my first 3 years combined.

I now earn around $6,000 per month, but this number should easily cross $10k/month within the next 6-8 months simply due to the nature of SEO and compound interest.

SEO is certainly not for everyone (most people don’t write articles consistently enough and most people aren’t patient enough to wait for results) but for those who understand it, it offers virtually unlimited income.

Resources

For anyone interested in learning how to start your own website, write SEO-optimized articles, and generate income online, I offer three resources:

1. The Income Community – A private community filled with tutorials on how to start a website and monetize it from scratch.

2. SEO Zoom Webinar – A recorded zoom webinar I did recently where I share the exact SEO strategy I used to take one of my sites from 0 to 90k+ visits per month.

3. 1-on-1 Consulting – I offer Zoom SEO consulting sessions where I can answer specific questions about SEO and how to monetize specific sites. 

Zach

Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.