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Bankroll Required to Make Adult Work (11)

12-17-2019 02:41 AM #1 chinopaisa (Member)
Bankroll Required to Make Adult Work

Hey guys,

Wanted to get your opinion on something...

So I've been running adult for about a year now, seriously for about 6 months... and up until now I have been pretty conservative in my spending (about $25-$50/day)... and I understand if I want to really be serious and make this work I need to spend more.

I've been a bit hesitant to do so, but I realize it's something I just need to get over.

So my question is, I have about $2k set aside right now... what kind of a budget do I need to really go in and make this work? Should I save a bit more before running campaigns again? How much of a bankroll do I need? $3k? $5k? $10k?

Once I get it profitable I'll be able to borrow more cash or use my CC, but just as an initial solid bankroll to really get something going... how much of a bankroll do I need?

Thanks!

12-17-2019 03:30 AM #2 jabong82 (Member)

I think a lot will depend on how much you're looking to make.

Lets say you want to make $100/day, you'd probably have to spend anywhere between $300-500/day.

Lets just keep it easy and make it an even $500/day, so even with weekly payments you'd need to have probably around $7k right there at your disposal to keep campaigns going ($3500/week + float).

So if you want to make more than that, then just multiply that formula to fit your needs.

12-17-2019 07:55 AM #3 trixxs (Member)

From past experience, spending $25-100 per day might but you in a position where you start seeing profit in 2-4 months. So it might be a bit heavy the first few months, but after piling on all the leads (if you are doing revenue share), the profits will just keep increasing all the time. Like I said this is with revenue share, definitely different with CPL etc.

12-17-2019 10:44 AM #4 matuloo (Legendary Moderator)

In order to get the ball rolling you need to start making about $1000 in revenue per week, as that's the usual threshold network required to set you at weekly payouts. Most of them pay with a 7 day delay, so you need to have enough funds to cover 2 weeks plus one more, as the payouts can take a few days to arrive. This would mean about $3k budget in case you're breaking even. Could be less if you are in profit.

In case you work with networks that are faster with payouts, you can decrease the required budget a bit, which is pretty much what profit-rex outlined above.

Once you manage to be constantly profitable, you can scale very quickly, it only takes 2 or 3 months to get rid of all the cashflow problems, at least that was the case with my campaigns when I was starting with paid traffic.

12-17-2019 10:51 AM #5 fjk87 (Veteran Member)

Don't be shy to ask (especially networks) for help with cashflow. If the quallity is backing out on the advertiser side, you'd be surprise how far some networks go. Used to be easier in the past, but still possible if you ask for a reasonable level of extra help to cashflow. Just don't born bridges by not delivering, traffic can always come and go for sure, but you should really try to increase the numbers if the network took the extra step - that's how a lot of relationships between networks and affiliates started.

12-18-2019 05:01 AM #6 chinopaisa (Member)

Thanks guys, appreciate the solid advice from different perspectives!

12-21-2019 01:41 AM #7 elprofesor (Member)

10k+ I'd say - the more the better.

With this you can test a lot, and if something works you can scale it a bit without having to bleed out due to networks owing you money. Finding something that works, and then not being able to scale it beyond 200$/d (10 day float in your case), is kinda pointless.

12-22-2019 09:42 PM #8 matuloo (Legendary Moderator)

Quote Originally Posted by elprofesor View Post
10k+ I'd say - the more the better.

With this you can test a lot, and if something works you can scale it a bit without having to bleed out due to networks owing you money. Finding something that works, and then not being able to scale it beyond 200$/d (10 day float in your case), is kinda pointless.
Indeed, for scaling, the more the better. But for the starters, I think 10k+ is a bit too much to aim for.

12-27-2019 01:43 PM #9 elprofesor (Member)

It depends on payout I guess - but imagine this scenario:

CC sub with $30 PO
You start spending 100$ per day and get 1 conv, next day you get 2, the day after 0. You may spend 1k and make 600, then you spend 2k and make 1500 etc. You see that your best banner is already almost profitable, and you cut some placements eating a lot of spend with no return.

Then you run several campaigns, let's say 5. With 5k you'd be able to allocate 1k to each, and you may lose half while testing. Then when you find some working placements or flows, you have no more money to recoup your investment. You can of course run one campaign, but then there are a lot of unknowns you can't account for (processing, scrubbing, local factors, tracking links).

Then you will be forced to prematurely cut potential winning campaigns due to bankroll, or you'd be forced to run only one campaign ... and no matter how good you are as a media buyer, you can only control let's say 40% of the factors (placements, banners, day parting), where 60% are out of your control (processing, holidays, saturation, legislation, news ++). The more campaigns you run, the less the last part, and day-to-day fluctuations, matter. Your FR camp might suck one day, but then a SE CC sub does well overall that week.

Also: A low investments will force you, in many cases, to run lower tier geos, which is what most beginners start out with. That's cool. But in many cases it's easier to make EU/US work, and processing might be more stable and it's easier to scale.

I'd say as an affiliate that makes a living off this, testing new stuff constantly and having a few campaigns where you reap profit. You should have 30-50k in bankroll to float as a one-man-band.

If you turn over this whole bankroll per month, and get an average overall ROI of 30-50%, then you pay fixed costs, business tax, trackers, payment fees ++ You'd be able to make a salary comparable to a well paying salaried position (engineer 100-150k per year + benefits), and still maintain healthy working capital in the biz.

If you decide to start with a low amount, let's say a few k, you should have a source of income to be able to put in more money. Most of us didn't jump into this with a few k and no income, and those that did and survived had a good chunk of luck (and nothing wrong with that, but results based on luck can't necessarily be replicated).

12-28-2019 03:32 PM #10 matuloo (Legendary Moderator)

CC sub with $30 PO
Oh yes, this totally changes the situation, the higher the payout, the more budget is needed to optimize things properly, I can only agree.

I'd say as an affiliate that makes a living off this, testing new stuff constantly and having a few campaigns where you reap profit. You should have 30-50k in bankroll to float as a one-man-band.
True again, but this comes later on. I believe that the OP asked about the "starting phase" so I based my calculations on that. But sure, once the scaling phase comes and with more campaigns being run alongside, the required bankroll has to increase significantly.

12-28-2019 05:35 PM #11 jaybot (Veteran Member)

I have no business posting here as I'm not successful. I'm not even running adult right now.

But.

I do have business posting here because I'm not successful.

So.

Depends on how much you want to test and what your risk tolerance is.

If you don't want to rack up a lot of debt, and if you don't mind losing everything: I'd say $20k based on my credit card bills.

Take that as you will

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