Obviously there are more ways of making money, especially on a short term basis. Take a successful concept and copy it and milk it until there’s no value left. Promise people the world, but don’t deliver. Con and deceive them, and be gone when they find out. You’ll make money, sure (you may get arrested), but you’ll never build a lasting business on these models. That’s because you’re sucking value out of things, instead of creating value and giving it to others. These are models of destruction, not models of creation.

The only lasting way of making money is by creating value for others. Creation…not destruction!

Subjective profit

People want to make good deals. They want value for money, and they want to get more value than they think their money is worth. A good deal is a deal that gives you a subjective profit. If you feel that you’ve gotten more value than you paid for (in money), you will feel you’ve made a subjective profit. You’re better off after the deal, than you were before the deal.

Although this may feel like a psychological trick to make people feel good about a bad deal, it in fact is not. People differ, and as such have a different appreciation of value. Something that’s very valuable for one person, may be substantially worth less to an other. The difference needn’t be great for people to experience making a good deal, and in fact actually making a good deal. Buying a blu-ray player won by a person that doesn’t own an HDTV, for a discount compared to the retail price is a good deal for both (provided you do own an HDTV).

The same goes for the age-old scarcity vs. abundance mindset. To the shepherd with a hundred thirsty sheep, the woman that owns a well but no warm clothes is rich. He would happily trade a sheep for water for his herd. For both this is a good deal. The shepherd has a herd of 99 that will survive and the woman has a sheep that will provide wool for warmth. The water is more valuable to the shepherd than the one sheep. For the woman the one sheep is more valuable than the water consumed by the herd. Both are better off, so both make a subjective profit from this deal.

Even when combining talents this mindset still stands. The awesome guitar-player with the mediocre voice is better of working together with the awesome singer with mediocre instrument skills, than both are competing against each other. In competition they make mediocre music and won’t feel awesome, in cooperation, they make awesome music and feel great. And they’ll provide awesome music to the world, instead of mediocre music.

Not the everyday make money online scam artist

A lot of the make money online websites out there, are not based on providing real value. There are more variations to this theme than I could ever make up. I know I’ve fallen for some of them, and it sucks. People know when they’re getting conned. But to a lot of these site owners, that’s not a big deal, because they already have your cash! After that: screw you! They don’t care about you, or your money making abilities. They already cooking up some other scheme of getting your cash.

That’s not how I want to earn a living. I’m all in favor of the value creation model. I believe that it’s the only lasting way of making a living. I hadn’t updated Scraping Pennies, because it left me feeling like one of those make money online scam artists. That’s just not congruent with who I am, so I’m transforming this blog into an outlet for my thoughts on creating businesses based on the value creation model. It’s the only model that works. It’s also the hardest to set up, and the hardest to maintain. Yet it’s the most gratifying model of all.

Creation!
Not destruction.

Scraping Pennies was one of the projects that got no attention at all. Well…I did check the stats every now and then. And it amazes me that there are 40 something subscribers that stuck around. A would like to give you a big THANK YOU, I appreciate your loyalty! The wait was not for nothing, because I’m rebooting the blog.

Some changes

First of all, I moved hosts. I consolidated all my hosting to one company, Dreamhost. All my hosting is still in the range of the regular shared hosting plans, and Dreamhost offers a great value solution. Their shared hosting plan allows you to host unlimited sites. So I could host How to be an Original and Scraping Pennies on the same hosting plan (and a bunch of other sites as well), instead of having a hosting plan specifically for either one of them. So this move saves me money.

The second change is the frequency of income reports. I started out doing weekly income reports, but I’m changing those to monthly reports. The weekly reviews are overkill in my opinion. Too much data for people trying to follow the progress of this blog. Imagine reading through 52 posts or through 12 posts to see how the past year has went…

The third thing I’m changing is income related. Initially I worked on getting Scraping Pennies as much of a stand-alone entitity as possible. That turned out to be very impractical. And as you can tell from the hosting move, I have abandoned that thought. I will do my best to seperate Scraping Pennies income from other income, but if it’s too much trouble I won’t. The same goes for cost. I have my hosting for my main online activities, Scraping Pennies enjoys a free ride on that hosting account and as such has free hosting.

The fourth thing I’m changing is budget related. I started out with a $250 budget. But this project is meant to be an educational fun project, and I won’t stop if the money runs out. So I’m going to allow to get below zero on my “funds”. But everything in moderation, this doesn’t mean that I’m going to spend money like a wild man! It’s just that I won’t let it stop me when I’m going to “run out of money”.

Additionally there’s also the thing of the stuff I already own, because I bought them for my other online activities. If they’re relevant to Scraping Pennies and there’s an affiliate program, I’m going to feature it here as well with no money down. It’s not totally ‘fair’, but I will still disclose the money I spent on it and why.

What’s not going to change

The main thing that will not change is that I will still give full transparency, about my investments in and returns from the blog.

The relative priority of this blog will also not change. It is not, and will probably never be, my top priority for getting an income. This is a fun and educational project, that has the goal of making money online. I won’t give a value to the lessons, but they are a large part of the ‘revenue’ of this blog.

What’s next?

The next step I’m going to make is to do get an overview of the financial status of Scraping Pennies and write a report about it. After that report I will start doing the monthly income reports, so the first income report will be early November (that’s about October’s income).

I also need to update the tutorial for OIO Publisher, as it’s outdated. Simon Emery released a new version of OIO Publisher, and made many improvements. Among them a big redesign of the site, so the screenshots in the tutorial are simply not correct anymore. He also raised the price to $47. Good products tend to get more expensive on the net, and OIO Publisher is a good product!

I’m looking forward to this renewed start. You have been patient the last couple of months, but as you know rebooting takes a while too. So I’m going to push that reboot button, please wait a couple of days until the system is up and running again.

• Platinum: a 468 x 60 advertisement in the header
• Gold: a 300 x 250 inline advertisement in the posts
• Silver: six 125 x 125 buttons in the sidebar
• Bronze: text links in the footer

OIO Publisher now manages these ads, including the payment process, the approval process and it monitors when ads should go up and when they should go down again. Click any of the four buttons on the Advertise screen to see the ordering and payment screen.

Hey and if you’re interested in advertising here, don’t hesitate to follow through!

Browser frustrations

I noticed that I managed to break the design in Internet Explorer 7 in the mean while. I checked with the great free service of browsershots.org to see if the design was okay in other browsers. Thankfully most browsers display the site as intended, while some show it a little different, but nothing to worry about.

But even Internet Explorer 6 looks better than IE7, which is a first to me. Usually IE6 is the culprit, to the extent that there’s even a site about urging people to upgrade: Save The Developers. This time that’s not my advice… I won’t even be able to fix it this weekend, so if you’re using IE7…sorry.

Why don’t you try FireFox or Opera? They’re both free and stick to web standards (as opposed to Microsoft, who insists on making their own standards).

I use FireFox, because it has so many great add-ons that make online life so much easier. Especially if you’re a web worker or a blogger.

My aim is to give full transparency on Scraping Pennies, and I call upon you to ask me questions when things are not clear. One of the main things I’m disclosing right now, is the monetization policy. In fact it’s pretty short and simple:

“If it can be monetized, it WILL be monetized. Unless…”

The “Unless…” part is my escape. It’s a highly subjective part, and I will define it along the way, as I encounter situations in which I choose not to monetize.

This can happen for instance when terms and conditions prevent me from giving any transparency. There are some advertisement programs who state that you can’t disclose any part of their service. Text Link Ads for one, has a service that has this condition. I declined it, because it goes against the spirit of Scraping Pennies.

On the other hand I know Google Adsense prevents the disclosure of some metrics in their program. While this doesn’t give full transparency, the amount of transparency I can give is enough to align with the aim of Scraping Pennies.

I can also imagine that there are opportunities that clash with my personal values and ethics. I don’t want to promote scammy, spammy, sneaky and shady activities. In those situations I will go with my gut feeling and report my decision here as well. Scraping Pennies is as much about what I do to make money online, as it is about what I choose NOT to do.

1. Commitment

The fact that I put in money is a token of commitment. If I quit, I’m at a loss. A tangible loss. $200 is an amount big enough to do some nice things with, and as such is big enough to make it a loss I can feel. After all I could’ve bought an Apple iPod nano 8GB, or six seasons of the series 24 on DVD, or the first three seasons of Lost and $100 change. Or I could’ve treated my wife and myself to a very luxurious day at a Spa-resort, including hot stone massages. Get the picture?

That $200 makes things more real, and make sure that I take this experiment serious. It makes sure that the psychology of investing money is helping me to succeed, or at the least to persist.

2. Brand and Web Presence Continuity

The budget enables me to build a brand and have continuity in web presence from day 1. Having my own domain with affordable hosting simply costs money. But because the blog remains in the same address from day one, every link you get stays in place. There’s a lasting presence on the web, and every effort you put in building the brand adds to the value of the brand.

And a strong brand and a strong web presence increases the likelihood of getting a nice price for your blog, in case you decide to sell it one day. Of course, that’s totally out of the question for Scraping Pennies for now. We’re just starting, but it’s good to know that every effort adds to the total value of the brand.

Of course there are free domains and free hosting, they’re widely available even. But they either show ads that don’t earn YOU money but them (the hosts), have terrible performance (and most of the times both!) and generally have a very amateuristic image. And as soon as you start to get serious, you want to move to your own domain and start building your web presence from there (again).

3. Kick-Starting The Earnings Curve

Making Money Online is not new, there are more blogs about it. And there are many systems and tools that you can use to earn money. Some are free, but a lot of them are not. Having the $200 budget makes sure that I can decide on buying a tool or entering a program, that can help me earn money faster. But the budget is tight enough to make sure I take deliberate decisions, instead of impulsive ones.

The $200 budget will help to skip the pennies stages of the Earning Curve as soon as possible and speed ahead to the dollars stage of the curve. After all, my intention with Scraping Pennies is not to scrape pennies I intend to get past that stage, and by disclosing everything it’s going to be an interesting case study on how making money online is done.

Chances are that you’re reading this post, even before the launch of this blog. In that case you’re reading in an RSS reader, and have subscribed even before the official launch. Wow!

So to give you a sneak preview of what you can expect from Scraping Pennies, I’m going to share a part of the upcoming about-page with you guys and gals.

So tell us, what’s Scraping Pennies?

The name Scraping Pennies means “to be poor; to earn very little money”. And face it, a lot of bloggers are doing just that. Earning very little money. And if it would be the only source of income, yeah we would know the meaning of poor! We would be scraping pennies to make ends meet.

Scraping Pennies, the blog, is an experiment. But not a casual experiment, it’s serious business. The concept is to start with a tight budget of $200. The goal is to get to a four figure monthly income as soon as possible, and beyond. And what’s going to be remarkable is that I will give FULL TRANSPARENCY.

That’s right: Full Transparency.

I’ll give an overview every week on Sunday with:

• Money spent in full detail (how much, on what, why)
• Money earned in full detail (how much, from what source)
• Hours spent (how many, on what, why)
• Income per hour – weekly
• Income per hour – cumulative
• Balance statement (how much is left / did I make from the $200)

And more, if that’s needed to give full transparency.

I’ll write about strategies, about the various methods of making money online and more. You’ll also be part of my frustrations (I know they’ll be there), my failures and mistakes (they’ll be there too) but you’ll also be part of my successes and the times I just got lucky. I hope that the latter two are more frequent than the first two of course.

This blog will launch on May 14. The budget is too tight to start with give-aways. But if you’re among the first 50 to comment on this post, I will make it worth your while when this blog takes off.