From traffic arbitrage to creating your products: $10000 with ROI 100% in 40 days on a white theme

Hi, Sintez is here. In this large but in-depth article, I will tell you not only about the bundle I’ve managed to make money on but also about the conclusions and principles I’ve adhered to during the process.

Make tea and hookah, it will be interesting.

Briefly about myself: I’ve been working in this sphere since 2008. First, I was engaged in working with Google Doorway, I succeeded quite well in it, and since 2012 I switched to offline businesses and online projects, which in total would accumulate a few dozen (more than 30). I returned to traffic in 2019 and immersed myself in Facebook and Google traffic arbitrage. I worked my way up from driving traffic, creating teams, and then investing in other teams. In general, I have a lot of experience, so I look at everything from different points of view. Now I have a few projects, including media buying, but my main focus is on creating projects for the US and Western European markets.

Now when we know each other, let’s move to the topic.

Part 1. Arbitrage slavery

Almost every arbitrageur, team leader, or media-buying owner at some point realizes that driving gray traffic from ad grids to affiliate networks (even if it brings a good profit) is slavery and a road to nowhere

• In case of a major problem with ad grids or affiliate networks, all the profit disappears and you are left with nothing. Storms, elections, shave, scams – these are all familiar processes that can paralyze the work of the media buying machine, and reduce revenue to zero.
• Easy arbitrage money leads to quick waste, and the habit of saving on needs or business contingencies is rare. And bad times always come, that’s where many teams fail.
• At the moment you can make good money and it looks like you are at the top, but in bad times most of the costs are consumables like accounts, domains, and payments, so the average profit for the year doesn’t look so nice. And I’m not talking about the costs serving the organizational structure, including business developer, HR director, external PR manager, and some patsy who doesn’t do anything but everyone thinks he’s needed 😀
• The moral side can also sometimes raise questions in your head because most converting offers are usually associated with some sort of end-user scam. Few people are stopped by this (in our countries), but everyone thinks about it one way or another.

That’s why many people who are on topic and have gone from great success to spectacular failures, after some time conclude that it is necessary to somehow increase independence, create their own products, and drive traffic to them, using the skills gained in the process of arbitrage.

No, I don’t mean to say that the traffic arbitrage business is bad. It is a good operating business with the opportunity to quickly accumulate capital, however, it is desirable not to spend money at the same speed. It is better to strengthen the safety cushion, move to more stable assets, and try to multiply this easy money.

But over time, of course, it is better to move up the food chain. No matter whether it’s your affiliate network, advertising network, transatlantic fiber optic cable, or just goods, you need to drive traffic to your products.

And it is desirable to have white products and projects, so as not to worry about bans or depending on anyone. So that you can eventually tell your parents what you do, and not make up something like “Well, I work in advertising, bring leads to clients, what’s the big deal? Can you lend me some money?”

In short, the idea is to work for the future, and not to be a slave of the arbitrage machine.

But then the question arises: Okay, we drive traffic to ourselves, we make our product. But what product to make and how to create it? What is it anyway, and how do you approach it?

A year ago I started to research this question, and since that time I’ve learned a lot, I’ll tell you all about it.

Even though I already had experience in creating projects, 5 years in traffic arbitrage did not pass by and spoiled my idea of the world, and it was not easy to return to product thinking.

Of course, when you or your team is driving traffic with an ROI of 200% and you make $5000 per day net, and then get paid in a week, and so on, it becomes difficult to return to the usual business approaches. It seems that it will always be like that. It feels like you’ve hacked the system.

But every party ends sooner or later. And the better the party, the worse the hangover.

Part 2. Choosing a direction: IT products

In general, in the end, I was puzzled by the question of raising my level in the food chain and started looking for options.

With my experience in offline production and commodity business, I quickly realized that I didn’t want to work with offline products. It’s a headache, especially if you don’t have experience or an experienced partner.

Sitting on the beach in Bali is better than lugging boxes of goods in Novosibirsk, it is even unpleasant to manage this process.

Production, warehousing, and logistics are a constant cost of time and nerves. I prefer working with digital products, where you can only operate with data, not physical goods.

I also wanted to apply the skills I gained in arbitrage:

• Massive approach to testing creos and approaches
• Ability to come up with bundles, familiarity with arbitrage verticals
• Experience in spending large sums of money
• Experience in finding competitors, copying bundles

This small but important list of skills in product marketing, in my opinion, can help in driving traffic to your products.

Well, come on, I’ve been driving traffic from FB for 5 years, can I get anything useful out of it? (Looking ahead I will say that it’s all important, but not enough).

So I’ve chosen these types of products:

• Android and IOS apps
• SEO websites
• SaaS and web services
• Browser extensions
• Mini-apps on Telegram
• Add-ons for notion, salesforce, slack, etc.
• Own affiliate network

And I made up such criteria and limitations:

1. Ability to make many attempts. I know from arbitrage experience that you should not do analytics on two leads. At least on three 😀 And given that I’ve had dozens of businesses and projects, I know my win rate and it is 20%. This means I have 2 out of 10 projects launching, they have similar economics and this theme can be scaled and multiplied. Thus, the industry should allow the creation of 10-20-30 products, so that someone will definitely catch on and I can make normal conclusions.
2. The primary investment is no more than $50,000. That is, for 20 attempts I should spend no more than $50,000. It is important to determine in advance because if you do not put a cutoff, you can drain all the money. And arbitrageurs often go all-in.
3. The ability to scale up quickly in case of success. Using the leverage in the form of working capital and paid traffic, it should be possible to quickly multiply the revenue of the product that is becoming successful. And when you run out of money, you can always find investment, it is not a tricky business, although not very easy.
4. The liquidity of the business when selling. Experienced dudes told me repeatedly, and I read in books that the biggest money from the business is made at the time of exit, and one of the personal goals for 2024 was to start, grow, and sell the business. That’s why I also took this moment into account. You can get as much money as you want on scheme traffic, convert LatAm, but your capitalization is approximately equal to zero, and the buyers’ market does not exist. You can’t pass it on to your kids as an inheritance, in short. 😀
5. USA or Western Europe market. The fun fact is that you make similar actions for the CIS market and foreign countries, but the difference in profit is 10 times. So there is no point in messing around in a sandbox, you should go straight to where your competitors are – guys from YC, funds, and other crocodiles. Yes, the competition is bigger, it’s a bit harder to move, but the market is bigger in money and in the number of users. You just need balls, persistence, and a little bit of madness.

I’ve described the directions and main criteria. Now we need to cross these things and see what happens.

I will tell you briefly about the nuances of each group so that you can follow the logic.

• Mobile applications. At the time of selection (early 2024), this was already a regulated market with a bunch of rules. Anyone who drives traffic to gambling knows it. Plus for 1 white app, you need $5000 for funnel development and testing. So you can’t fit 20 products in here. 10 at most, and that’s if you do it right. And I had no experience in apps at all. I decided to skip it.
• SEO sites. Having experience in black SEO, I certainly considered this option. However, white SEO does not imply getting in the “buy Viagra” TOP list in 1 hour. White SEO is about waiting for several months, up to 1 year to get some good traffic. Plus media buying is not particularly applicable here. Skip.
• Saas and web services. All cool, but expensive. Launching one product can take months and tens of thousands of dollars. So at that point, I decided it wasn’t suitable for me. But I put it aside for the future.
• Browser extensions. A cool topic, in the sense that you can stamp a lot and cheaply. The cost of one product is from $10 to $500. But there is a problem – money. There’s not a lot of money out there, and it’s hard to earn it. But I took note.
• Mini-apps on Telegram. Growing market, wild west. The price of users – pennies, everyone is going crazy. I did some test drives and saw that traffic can be received cheaply and in great amounts. But what to do with it? Everything revolves around crypto-meme-tap apps. I didn’t understand how to monetize it and what the market needed. Utility tools are almost unnecessary on Telegram. But I took note.
• Add-ons for notion, salesforce, slack, discord, etc. You need to know the market and target customers well, and I don’t. So I skipped it.
• My affiliate. This is a good way to enter the CPA market with the product, as it was once done by “Gambling Pro”. However, in those topics where I had expertise, I did not see successful opportunities for an affiliate network, plus a 50k investment was not enough. I had always dreamt of creating an affiliate, but that time I skipped it. Perhaps, someday, the time will come, I do not give up hope 😀

Chapter 3: Where I started: Chrome extensions.

Anyway, after smoking a hookah, I decided to start with browser extensions. I was hooked by the ease of the products’ launch, the ability to grab a lot of ideas, and topics. Something would work anyway. It’s just a statistic, it’s impossible to create 20 projects and not a single one will become successful.

My goal was simple: to start by creating a few pieces of browser extensions to understand the development process. The hardest part is getting started. So it’s better not to jump above your head and make just a calculator and see the first people using it than to spend 2 years making another finance tracker with AI and then realize that the market is full of sharks and your product is shit. I found a Russian community that dealt with extensions, got training from them, put their knowledge on top of my experience, and started moving.

I immediately started preparing tools like SEMrush, antidetect (so as not to store everything in one basket), accounts, and proxies. The set of a respected arbitrageur! And then my assistant, developer, designer, and I made 5 first extensions. In general, I believe that it is important to immerse yourself in the processes at the initial stage of a new business. Delegating the launch of new directions does not end well, at least I’ve never succeeded.

By the way, to create extensions, you don’t need such a team at the start, you can do everything yourself. You don’t even need to code, or you can find someone who will repackage the sources from GitHub for a beer.

So, in a month we released 5 extensions (QR generators, downloaders from Twitter, YouTube summarisers, and other things). And I almost immediately made these conclusions:

• The thing about extensions is that they quickly get to the top of the SEO if there is adequate competition (about 24 hours). It’s very pleasant.
• But the market is already split, it’s hard to find a place where you can stay. There are a lot of competitors. It’s hard to find the requests. There are already 50 cleansers, parsers, checkers, etc.
• Monetization is questionable there. The emphasis is on tools that don’t have costs, but that can be sold for $10-50. The fuckup I made was launching a YouTube video summarizer via Openai. It immediately started bringing costs on API and paid traffic didn’t pay off. I invested a lot of dollars in the extension and got 2 payments of $10, tested Google ads.
• Difficulties with payment, people are reluctant to pay for extensions. In CIS people don’t pay for anything at all, but in foreign countries do, but still not as much as for iOS apps.
• The cost of developing one extension is about $200, which is much cheaper than mobile applications. In general, you can spend only $20.

So, it became clear that there were installations, even payments and it was necessary to increase the turnover for tests. However, I was no longer able to produce extensions and decided to hire a project manager. I wrote a post about it on my channel.

It’s a bit difficult to manage the production and support of 15-20 extensions, plus manage other projects where I didn’t participate operationally, but sometimes I had to help. I also had a family, kids, golf. I needed to meet my friends. In short, it was hard to work with a new theme without a helper! But I did my job – I produced the car and made it go.

So, it was done. I built a quality HR funnel and found a suitable person, together we started moving faster.

The next few extensions were weak, but one of them expectedly had success.

Chapter 4. A successful idea: speeding up YouTube in Russia

When YouTube started to be blocked and slowed down in Russia, it became obvious that there was a concrete demand for a solution to this problem. Essentially, we needed to create a simple VPN or proxy server to bypass the restrictions. The matter was simple – the source code was available on GitHub, we just needed to build it, the rest of the processes we had already worked out earlier with other extensions.

But then I thought about it.

I was confused by the fact that this solution was oriented to the RF audience, which was not used to paying for Internet products, not to mention extensions for Chrome. Especially for those that were not needed even yesterday. Plus the legality of this business was questionable. When the regime blocks something, going against it can end badly, and although I don’t live in the Russian Federation, I am a citizen. And hell knows how life will turn out, I don’t like to burn bridges.

In general, on the first day of the trend, I decided to skip the topic.

But on the third day, my friend chatted with me and asked if I had made a YouTube speeder for Chrome. Then I thought about it once again, discussed the topic with my project manager, and we decided to enter the market and see what would happen.

We made an extension in a few hours based on the available source code, built it hastily, and released it to production. It offered a speedup solution that didn’t work, by the way. After that, I went drinking, as there was an agreement. Classic 😀

Chapter 5. Explosive growth and first difficulties

I spent quality time for 2 days in a nice hotel on the Caribbean coast and on my return, I decided to check the metrics of the pre-landing that was opened after installing the extension.

And what I saw there: 2k, 5k, 7k, 17k, 23k installs per day. It was hard to imagine better news, especially after returning from the drunk.

I got a horse dose of dopamine, and thought, yeah, baby, that was exactly what I played that game for: to experience that feeling periodically. Excitement and interest are not comparable to anything else in the world. Next, I went googling keywords. And the extension got to Google’s top for queries related to YouTube blocking in one day.

This is because browser extensions are located on Google’s trusted domain, and with the right keywords, they rise quickly in search. In the absence of competition. And as you can imagine, there was no competition, because the topic was just gaining momentum.

However, there was a problem, the extension did not work. And we had to organize a server for its correct functioning. And we needed not just a server, but a good one with a normal channel, unlimited traffic, and other subtleties. I had not used such servers before, so I immediately contacted the owner of Inferno Solutions on Telegram and asked him to help me urgently. The service was top as always, I strongly recommend it, I’ve been using it for 14+ years. Anyway, we quickly used proxies and the extension started working, we started getting positive feedback and ratings.

At the same time with the extension update, we implemented one little thing that came to my mind thanks to arbitrage experience and which later played a key role – we forced people to subscribe to the Telegram bot immediately after installing the extension, under the pretext that the extension should be activated via Telegram. It was a dummy, but the conversion to Telegram bot activation was under 70% 😀 I’m not ashamed, there was no scam, right?

Anyway, the next problem didn’t take long to show up. The number of installations grew at great speed, and on the second day, the server could not handle it. We expanded the channel, but still, to serve tens of thousands of people who watch YouTube, we needed strong hardware and channels and that would cost $5-8k a month.

After making those calculations, the next question came up…

Chapter 6. The question of monetization

With so many users (100k installs at the time, then growing to 500k) it became clear that we needed to monetize the product, and as soon as possible. We considered several options:

1. Insertion of ad units.
2. Paid subscriptions.
3. Selling the product or its user base.

We looked for payment services, options for monetization and advertising, and buyers.

It turned out that payment services in the Russian Federation that provide recurring payments require a legal entity. I haven’t had one in the RF for a long time, and in general, I didn’t want to connect such a project with myself. And to look for drops, register legal entities, warm, cash – it is again to return to the same forest. Muddy payments services which processed gray projects were surprisingly not interested in the project too, probably because of additional risks. To accept crypto – it sucks, conversion will be at the bottom. And to ask for donations – only to disgrace yourself, it does not work in Russia. Donations don’t work anywhere except big politics.

There were no solutions for ad-blocks and other side methods of monetization either, especially for the RF. The market of ad grids in browser extensions is almost non-existent.

We wrote to anyone we could to sell the product, but we didn’t see any obvious interest. We could only be bought by those who were interested in it, and these were the remaining VPNs in Russia or a small number of competitors (only one was more popular than us).

Of course, there was an option to sell the bot with users to scammers for $10-30k, given the number of people at that time (100k+ users on Telegram) and the average price of a subscriber. But I knew how they would work, so I thought it wasn’t worth scaring people like that.

In general, it turned out that our product was popular, but except for problems it did not bring anything. We decided to integrate the payment system, somehow finding some option, and monetize it via subscriptions – the most sensible way to monetize anything.

Chapter 7. Negotiating and selling the product

In 20 days after the product launch, we already had mockups drawn and a backend for accepting payments.

But then suddenly a potential buyer, our main competitor, showed up. We contacted its representatives earlier, however, they answered that they would think about it. I decided that now we should act.

I won’t go into details, but after that, there was a series of negotiations and we agreed on a price of about $10k.

I realized that that was not something I could earn in the future, and 10k was not enough. But taking into account several factors, such as the market of the RF and the fact that VPN products were not interesting to me, the unclear status of business legality, etc., I decided to sell the product for that price. I went out of the game and made the buyer happy. And the buyer turned out to be decent, and adequate. They had their main business – VPN service, exactly for the RF, in general, our expansion and the base of people could boost their business.

Now I will return to that decision of integrating Telegram to the pre-landing after installation. It turned out that we had a lot of users, and it was exactly what they bought – a base of users on Telegram. The extension came with a trailer and didn’t interest the buyer much.

So, 40 days after the product launch, we closed the sale, and at the same time, I made the first meaningful and planned exit, which was my personal goal for the year.

And we didn’t just sell the product, we made 5k net and ended up making an ROI of 100%. That is, we spent 5k on servers, developer’s salary, design, project manager’s salary, and other things. We could spend less, and we could reduce everything to 2k, but the goal was not to make it cheap, the goal was to make it beautiful!

Let’s open the champagne and celebrate!

Chapter 8. Conclusions and Lessons Learned

I don’t want to advise you on how to do or not to do things, there are plenty of people on the Internet willing to give out advice.

But I will share the conclusions that I have drawn for myself and that I will stick to in the future.

1. Making your products is great. It’s many times more interesting than driving traffic to affiliate networks but of course, it’s also more complicated. It requires a complex approach, but of course, traffic always remains at the top in importance. You can make a TOP product, but if no one sees it – it’s just a waste of time. Nevertheless, great power requires great responsibility, and while dealing with the product, you should also deal with such things as support, branding, technical support, positioning, product management, marketing, and a couple of dozens of other processes. But all of these processes are simple, especially for people in the traffic arbitrage industry, where being savvy is the number one quality of importance.
2. Taking trending topics is smart. You can do the same action, but in a trending market you will get x10 to the result, and in a competitive market you will only face competition, regulations, expensive traffic, and so on.
3. You have to do it to sell. Guys, this 10k was my most enjoyable money earned in recent years. And although that was not too much, it brought me real satisfaction. It was a work that someone else found valuable and bought it. And in general, the approach of creating a business for sale initially makes everything more sustainable and independent. Even if there is no goal to sell something, you still need to do it as if you are going to sell it soon.
4. So, what is cooler: drive traffic to the Affiliate Program or your products? Even though this whole article is about transitioning from an arbitrage to a product business, I believe that you can and should be able to manage both. You don’t have to choose, you can combine the two. Traffic arbitrage is a good machine for printing money, but sometimes it breaks down, and you just need to have your network of tire shops, which works and will work, even if everywhere around there are Teslas.
5. Money is not made on improving processes, but on using opportunities. Well, you can hire new HR, make a corporate policy about onboarding new hires, or improve copy protection for landings. But that’s all about improving current processes. That’s important, but it’s much cooler to spot new opportunities, directions, and trends, and just always keep abreast, each time asking: “Okay, how can I use this trend or this crisis to my advantage with my current experience?”. I dumbed down at first and therefore came second in this case study. That’s okay, it was a good lesson, next time I’ll go into the market like a hungry shark.
6. Luck is very important and can be controlled. Let’s be honest. The scheme described in this article is not so much the result of labor as the result of luck, i.e. the right actions at the right time. But the trick is that the more attempts are made, the greater the chance of catching luck by the tail! More attempts = more mistakes = more success. It’s simple. Arbitrageurs know that it’s stupid to drive traffic to one account and just look at it. You should drive as much traffic as there are cans of Redbull on the table, and then drive again, fall asleep in the office, wake up in the morning, and continue. This kind of marathon is always important at the start, and then you can relax a little bit afterward, taking advantage of favorable positions.
7. It is necessary to tie the users to your product. As I have already said, a successful and key solution was to tie users to the project’s Telegram bot. And this is what makes the difference between driving traffic to gray and white schemes. In white schemes, you hook people and it becomes your main asset. Telegram works great in the CIS, and for foreign countries, you need to use fucking emails that are opened only by 10% of recipients, but can at least be used for re-targeting. Yes, this function isn’t used by arbitrageurs, because accounts die faster than the required number of users appear in the database. But with white topics, you have to hook users and work with them. 80% of revenue comes from retargeting, and only 20% from the first touch (which eats 80% of the money).

Chapter 9. Further plans and thank-you part.

After a successful experience with browser extensions, I decided to continue working on building products, but now I am focusing on larger markets such as SaaS for the US. Extensions are a good training ground. But you have to raise the stakes and make the game harder.

I’ve written this article in one breath, imagining that I’m writing it to my kids for the future, with full commitment and without pursuing any personal commercial goals. In short, I hope you’ve enjoyed it and will give it some thought.

If you have any questions or want to say thank you, feel free to message me. I also have a blog on Telegram, where I rarely add such posts, but we discuss different topics on work and life. In general, I invite you to visit it, welcome.

And lastly, I have a question for you.

If you have the opportunity to do a good deed for your friend, and it will cost you no money and time, will you do it? Well, my answer is “yes”, and if you’ve answered the same, then here’s what you can do now. Think of a good buddy of yours who will benefit from reading this crime fiction, and just send him the link. Good things always come back in the form of good luck, and that’s what every one of us needs!

Thanks to the editors of Cpa.rip for posting my long-reads for the second time.