Why I’m Not Selling My Business

Why I’m not selling my business

I have this dream lingering in the back of my mind about selling my business and sitting on a beach somewhere drinking endless San Miguel Lights or Tiger Bacs.  All without a care in the world and doing this while living off $20,000 USD/year afforded to me by using the 4% rule.  But after doing some calculations and re-evaluating my business I decided to keep it.  

I realized that what I actually wanted more than retiring on a beach somewhere was freedom and stability and this could be accomplished not despite my business but because of it.


The 4% Rule vs The 40% Rule

4% is the safe withdrawal rate where you can theoretically withdraw 4% of an invested sum of money a year without lowering the principal.  So if you have $500,000 invested in index funds you should be able to withdraw 4% or $20,000 a year forever.

This is basically the principle behind FIRE (Financial Independence Retire Early), which is arguably much better than the old model of Retire Old and Try Not to Die but not without it’s faults.

The 40% rule (which I first heard on the TMBA Podcast) basically says that instead of investing in traditional markets to get the 4% rule, you can invest in a website and with a little work and time you can get a 40% return.  By owning a business you are essentially using the 40% rule.


Problems with Retirement

The first problem with retirement is that it is probably pretty boring.  How many people retire only to take up a part-time job as a Wal-Mart Greeter or volunteer as a crossing guard at a local elementary school.  People need to have a purpose in their life and sitting on a beach doesn’t usually accomplish that.

The second problem is that 4% on an investment sucks.  Okay, I know that this is the “safe” withdrawal rate and the stock market has averaged 7-10% over the last hundred years so you could potentially end up with a lot more money.  But you don’t really have any control over this and you could also end up with less if the markets don’t preform the same in the 21st Century as they did in the 20th Century.


What would happen if I did sell my business?

Online businesses typically sell for a multiple of 25-35x monthly profit.

I’ve had my business for 5 years and the past 36 months it has made an average $6,000/month profit.  If I get a 30x multiple on the site then that is $6,000 x 30 = $180,000.

$180,000 USD – Website Sale for 30 x Multiple

-$21,600  – Brokerage fees –  10-15% brokerage fees, we’ll say 12.5%


-$17,854  – Taxes  – $158,400 – $39,375 (0% cap gains tax) = 119,025 x 15% (capital gains tax) = $17,854.00

$140,546 in my bank account after the sale

So if I take this $140,546 and invest it in index funds it yields me a whopping $5,622 each year using the 4% rule.  Or I could keep my business running at it’s current level of $72,000/year and this would come out to be a 51% return on a $140,000 investment!  So instead of selling my business I am treating it like it is a business that I bought as an investment.


What would I do after I sold my business?

This question is often overlooked by people wanting to sell their business and thanks to books like Before the Exit by Dan Andrews I have the luxury to contemplate it before actually selling my business.

Over the years, for better or worse, my identity, self-worth and purpose have been derived from my business.  Selling it would most likely create a void which many previous owners are faced to deal with.


Why I wanted to sell my business:

To dig further into this, I want to look at WHY I wanted to sell my business in the first place.  The main reason is that running a business is stressful.  I have an e-commerce business that deals with physical products so there are customers I need to deal with, supplier relationships needed to maintain, SEO needed to be done to drive traffic, Google Algorithm Updates to avoid so I don’t lose the traffic, etc.

But instead of throwing out the business with the bathwater, I started outsourcing the things I didn’t want to do anymore.

The first step was to get a VA which I hired off up Upwork for $6.00/hour (which I think is high but extremely low compared to what my hourly rate should be).

Now all of my email inquires go to the VA first and then (when the customer is further down in the sales cycle) to my email inbox.  This has cut my email time in half.  They also do customer check-ins, order processing and tracking and I hired freelance writers for content.  All of this has brought down my total amount of work to about 13 hours a week.


Running your own business is easier than running someone else’s.

This shouldn’t come as a shock but I know my business better than anyone in the world.  I know what works and what doesn’t, what products to add to it, how to deal with customers and after 5 years I am only getting better and more efficient.

If I sold my business I would be starting from scratch and having to learn a whole new business.


Online businesses are tax efficient.

Remember the $17,854 I had to pay in taxes, that was mostly from long term capital gains which would be about 15% (you can exclude the first $39,375 assuming you don’t already exclude that using the Foreign Earned Income Exclusion).

Foreign Earned Income Exclusion (FEIE)

The FEIE allows US citizens living abroad to be exempt from paying federal income tax on their first $105,000 of earned income as long as they pass either the physical presence or bona fide resident test.

Since I am a US citizen living in Taiwan and I’m a bona fide resident of Taiwan I can claim the FEIE and I don’t have to pay federal income tax on the $72,000 I earn annually (however this is still subject to self employment tax).

One of the biggest areas of confusion with the FEIE is the “earned” part.  When you sell an asset, that money is not earned so it doesn’t qualify for the FEIE which is why I would have to pay 15% taxes on it.  But if I “earn” the money by working in the business then it does qualify for the FEIE.

There are also many small business deductions to take all of which make running a business much more tax efficient than selling one.


Final Thoughts

Treating my business as an asset and investment has given me a lot of mental space and clarity and while it is ultimately a better decision for me to keep my business than sell it, it certainly doesn’t mean that’s the best choice for everyone.

I’m going to focus on outsourcing as much of the business as I can and keeping it as part of a portfolio of businesses.

What is Financial Freedom?

What is Financial Freedom?

achieve financial freedom

While this number will vary for everybody, the basic math is: Cash Flow from Assets > Monthly Expenses

It is actually a pretty simple concept but it can be hard to implement.  Think of it like trying to lose weight.  To lose weight, you don’t need a fancy diet, supplements or a Bowflex PR3000 Home Gym.  All you need to do is eat less and exercise more.  Sure, you can starve yourself and lose weight while you can also spend 4 hours a day in the gym and lose weight.  But, like with most things in life, a balance and combination of the two will result in the best and healthiest results.

So to have Financial Freedom, what we need to do is Increase Cash Flow and Decrease Expenses.  Again, you can focus on only 1 side of the equation and still get results, but we are going for a more balanced approach.

Financial Freedom = Cash Flow from Assets > Monthly Expenses

The easiest place to start is with your expenses.  No, not with your Starbucks Addiction or Netflix Account but with YOUR BIGGEST EXPENSES.  Which for most people are Housing, Transportation, Healthcare and Taxes.

Housing is the easiest to fix.  No, you don’t need to go run home to your twin bed in your parent’s basement but you do need to get a little creative.  If your goal is to be financially free then you will need to make adjustments to your lifestyle which will seem like sacrifices at first.  The first place to look is what city and country do you live in?  Are you living in a big, expensive city like LA, New York or London?  If so, your “number” to be financially free is going to be a lot larger than someone who is living in Pittsburgh, Dayton, Ohio or Bangkok.  Also, what part of the city do you live in?  If you’re living right downtown, then it might be wise to move a little further from downtown and get a cheaper place.

Next, if you’re living alone, you just made it that much harder on yourself, unless you live in a low cost city.  (I pay about $250 for rent and bills in Kaohsiung, Taiwan.)    So getting a roommate or renting out your extra room/couch/etc on Airbnb will greatly lower your expenses if you’re in an “expensive” city.

House Hacking is my favorite option because it will help build wealth in two ways.  One, it lowers your expenses so you can save more and two it gets you started into real estate which helps build more assets/wealth.

House Hacking is when you buy a house and rent out part of it to cover your rent and in some cases give you extra cash flow.  So let’s say that you buy a 3 bedroom house for $150,000.  Your mortgage is $750 and you rent out your extra two rooms for $500/each.  Now your cashflow is $1,000-$750 = $250.  Just to be conservative, we’ll spend this $250 on home repairs in case something happens.  You are now LIVING FOR FREE while having your roommates pay equity into your house.  When you sell that house, you get the equity back PLUS the appreciation.

Digital Nomads in Taiwan

Digital Nomads in Taiwan




Taiwan has recently been ranked as one of the top places in the world for expats to live.  This is mainly because Taiwan is an incredibly safe country with friendly locals, fast internet, access to great health care, modern subways systems, mountains and beaches.  It’s also one of the most “convenient” countries in the world.  There are literally 7-11s everywhere and at these 7-11s you can find single cans of beer, fresh food, pay your bills and even have your packages delivered.  Despite this Taiwan is often overlooked when people are considering where to start off their digital nomad career.  In fact, a lot of people probably can’t even find Taiwan on a map.  I’ve lived here for the past 6 years and I still have friends and family back home who think I’m in Thailand instead of Taiwan.

Most westerners come here to teach English and that’s how I first got here before I started my online businesses.  The average wage for English teaching in Taiwan is about $20USD/hour and living expenses are about $800-$1,500/month (depending on how frugal or baller you wanna live).  This makes Taiwan a great place to baseline your business and you can even supplement your income by teaching English until you get your business off the ground.


Being a Digital Nomad in Taiwan




Taiwan has been my home for the past 6 years.  I originally came here to teach English then I ended up getting my IMBA(for free), working for a local company here and eventually starting my own business and becoming a location independent entrepreneur.

I’ve been running an e-commerce business for the last 3 years and have been “location independent” for the past 2 years.  Even though I love traveling to other countries I still prefer having a base and Taipei and Kaohsiung are both great options.  They both have an international airport and a high speed rail stations where you can travel between Taipei and Kaohsiung in under 2 hours!

One of the biggest reasons that Taiwan is a great place for digital nomads is that you get a 90 Day Landing Visa right off the bat, no need to extend after 30 days or pay a fee.  The two largest cities are Taipei and Kaohsiung and both of them have their own charm.  You could compare them to Bangkok and Chiang Mai.  Taipei is the capital and has an expansive MRT system, world class restaurants/night life and is surrounded by mountains that can be reached easily by MRT, bus or scooter.  Kaohsiung is was my home for 5 years and is cheaper and has better weather than Taipei.  It’s a lot more laid back and a good place if you want to chill out on a budget but the night life and entrepreneur scene is a bit lacking.



Digital Nomad Cost of Living in Taiwan


Taipei is the Capital of Taiwan and when most people come to Taiwan they usually fly directly into Taipei (Taoyuan International Airport).  One drawback of Taipei (and Taiwan in general) is the lack of affordable short term housing.  Renting an Airbnb for 1 month will cost about $900 while you could rent the same place for about $400 with a 1 year lease.  Short term leases are available but take a bit more searching, I recommend staying for at least 3 months to make it the most cost effective.

Taipei Cost of Living:
Average cost of living in Taipei is about $1,500/month (USD)

$300 Room in a Shared Apartment
$500 Studio (3 month – 1 year lease)

Food, Fun, Misc:

Total – $1000 – $1,500


taipei digital nomad

Taipei 101 at Night

Kaohsiung is the second largest city in Taiwan and can be reached by it’s own international airport or via the high speed rail from Taipei. The cost of living in Kaohsiung is about $800-$1000/month.



View from Kaohsiung Harbor

Rent in Kaohsiung can be as cheap as $150 for a room in an apartment or as much as $600 if you want to live in an MTV Cribs Style Apartment.  I spent about $300 (10,000 TWD) for a studio apartment.

Kaohsiung Cost of Living:
Average cost of living in Kaohsiung is about $1,000/month (USD)

$150 Room in a Shared Apartment
$300 Studio (3 month – 1 year lease)

Food, Fun, Misc:

Total – $800 – $1,100


Food in Taiwan


One of my favorite things about Taiwan is the food.  Not only is Taiwanese food delicious but you can also find reasonably priced Thai, Vietnamese, Japanese and Western restaurants creating an incredible variety of food choices.  You can easily find local meals for about $3 while western food will cost about $5 or more for a meal at a restaurant.



Typical Lunch in Taiwan for $3.00

Transportation in Taiwan


Taipei has an extensive MRT system that connects the entire city.  As long as you live near an MRT station you can pretty much get anywhere in the city.

Kaohsiung has a smaller MRT system with 2 main lines.  There are also scooters everywhere and this is how most people get around.  You can buy a scooter for as little as $300 but expect to spend $600 for a decent scooter.


Digital Nomad Scooter

My 150cc Scooter for $750


Where to Work as a Digital Nomad in Taiwan


There are coffee shops all over Taiwan with fast internet and you can get a cup of coffee or cappuccino for about $2-$3.00.  Here’s a great list of other recommended Coffee Shops in Taiwan.

Taipei has a larger digital nomad scene than Kaohsiung and has coffee shops everywhere.  There are also some coworking places and if you stay at Eight Elephants Hostel, they have a coworking space that you can use for free next door.  Not many people were using it but it definitely has some potential.

Kaohsiung has a small but growing digital nomad scene.  There is also a weekly Coworking Day Meetup at that can be found at meetup.com


Final Thoughts on Digital Nomads in Taiwan


Taiwan has a lot of offer for digital nomads and the 90 day free landing visa makes it an attractive choice for those who are tired of monthly visa runs.  I consider Taiwan a good halfway point in between Southeast Asia and countries like Japan and Korea.  It has the cleanliness, safely and civility of Japan and Korea with a cheaper price tag that is more similar to Southeast Asian countries.

Why Most Dropshipping Businesses Fail

Why Most Dropshipping Businesses Fail




Most People Don’t Treat Drop Shipping Like a REAL Business


The number one reason most dropshipping businesses fail is because people don’t treat it like a real business.  Whatever drop shipping “niche” you’re getting into, take it seriously.  Think about how you can help add value to that particular market place.  Don’t try to drop ship some fidget spinners from Ali Express and then wonder why it didn’t work out.

Whether you like it or not, you’re building a real business.  You’re going to have real customers with real problems that need solving.  This is how you build trust and build a business.  In the end, this is what you want to do because it will lead to the most value for yourself.  Your job as an eCommerce entrepreneur or “drop shipper” is to provide value to your customers.  You are providing a trustworthy platform where customers can find answers to their problems and safely purchase a product or service.

Most Drop Shippers Don’t Solve a Problem

Businesses are about one thing and one thing only, solving problems.  More specifically, solving other peoples problems, not about solving your problem about how to make thousands of dollars online so you can travel the world.  Look at your product and service and ask if you are actually solving a problem and providing value.

As an eCommerce entrepreneur or drop shipper your job is to solve problems.  Your customers have problems, you have solutions.  Let’s take the example of Andrew Youderian at Ecommerce Fuil who created and sold TrollingMotors.net for over 100k.  Andrew created a drop shipping store where he sold trolling motors.  This is not hard to do and anyone can build a site, contact suppliers and start drop shipping trolling motors.  The thing that set him apart from his competition was that he also put together an in depth website that answered peoples questions about the different trolling motors.  By doing this he created a valuable resource for his customers which in turn built trust and lead to more profits.

If you’re considering drop shipping or Ecommerce, then do yourself and your potential customers a favor.  Start a real business.  You can still drop ship and in many cases should drop ship.  Just realize that you’re starting a real business and any temporary arbitrage opportunity between eBay and Amazon or aliexpress and Shopify are going to be over saturated and undervalued.

Money Doesn’t Take a Vacation, it Makes the Vacation

Money Doesn’t Take a Vacation, it Makes the Vacation


Digital Nomad Scooter

Last month I went on a road trip in Kending, Taiwan (also frequently spelled Kenting) and decided to bring my laptop with me.  I actually purposefully bought this scooter because the trunk was big enough to fit my 15.6″ laptop inside.  Anyways, before I left on the roadtrip I had a problem with a customer who said they didn’t receive their package so I decided to bring my laptop so I could deal with it once I got down to Kending.  As I was driving I started feeling sorry for myself having to “work” and bring my laptop down to the awesome beaches in Kending but then it hit me.

This is my life.  I am completely location independent, I can go anywhere in the world and run my business.


Sure I have to be connected to the internet and answer emails but I wouldn’t trade that for a real job in a million years.  I like getting sales and making customers happy and growing my business.  The business is what is funding my entire life.  So while my friends with jobs are getting drunk and not worrying about work for 3 days straight, I’ll still be thinking about my business.  How to grow it, how to improve it and how to make this lifestyle last forever.  Because when you’re a business owner, you don’t ever really get a vacation, but a the same time, you’re always on vacation.

So that’s why I always travel with my laptop, why I check my email at 3 am after a long night out and why I’m in a coffee shop right now on a Saturday writing this blog post.

Money Doesn’t Take a Vacation, It Makes the Vacation