Income Report: Q1 2016

The first quarter of 2016 has come to a close, which means it’s time for another quarterly TMM income report.

In this series, I take a break from talking about style for shorter men to give you a glimpse “behind the curtain” of the blogging business.

Why do I do this? A few reasons:

• People often ask if and how I make money with The Modest Man.
• I like to be transparent.
• Online business fascinates me, so it’s fun to talk about.
• To inspire other people to start and grow their own blog.

If you have no idea how a blog like this one makes money, read this post first:

How Does The Modest Man Make Money?

In this income report, I’ll break down my revenue, expenses and profit for Q1 2016. Let’s start with revenue.

TMM Revenue for Q1 2016

First, let’s look at quarterly revenue for the past 15 months:

Revenue falls into three basic categories:

1. Advertising/sponsorships
2. Affiliate commissions
3. Selling products

Let’s see how each one did this quarter (note: many of the below links are affiliate links):

Affiliate – $3,000 (up 35% from previous quarter)

• RewardStyle – $994
• Amazon – $1,254
• Modern Tailor – $341
• Huckberry – $145
• Other – $267 (mostly Blank Label and Saddleback)

It’s good to see my two main affiliate networks – Amazon and rStyle – growing each month. One possible reason for rStyle growth is the delay in “finalized earnings”.

I’ll explain. If someone buys through on of my affiliate links at, say, Nordstrom.com, I don’t earn a commission at the time of purchase.

In fact, for most vendors, it takes 30-90 days for the payment to finalize. They have to make sure the products aren’t returned so they can ensure they get paid before giving me my affiliate fee.

So when I get a payment from rStyle in March, it could be for transactions that happened months ago, during the holiday shopping season.

Advertising – $7,099 (down 26% from previous quarter)

• Direct Ads – $1,650
• Google AdSense – $330
• Sovrn
• AdThrive – $1,420
• Sponsored Posts – $3,699

As I explained in the 2015 Year in Review, I started letting a company called AdThrive manage unsold display ad inventory (i.e., banner ads).

Ad network revenue used to be an afterthought, but AdThrive is doing a great job, and it’s great to see this revenue stream grow.

Overall advertising revenue is down from the previous quarter because the previous quarter was Q4 2015, which is the holiday shopping season.

In general, Q4 is great for this sort of business, while Q1 is kind of slow.

Products – $4,586 (up 130% from previous quarter)

• The Modest Man Style Guide – $2,760
• TMM Button Up Shirts – $1,826

The Modest Man Style Guide continues to sell consistently, and I got my first payment from the TMM button up shirts (it was a pre-order model, so it took a while to actually collect revenue).

Just a side note: the shirt launch went well, but it wasn’t very profitable. The shirts were very expensive to produce, and I didn’t want to sell them for over $100, so I didn’t make any money from this project.

That said, I’m very happy with the results. This project was an experiment to see if TMM readers wanted to buy actual garments, and the answer is yes!

Not to mention, most customers are really happy with their purchase:

I’ve already had a bunch of people ask when the next batch of shirts will be for sale, which is very encouraging.

Total Revenue = $15,560 (up 12% from previous quarter)

Keep in mind, this is quarterly revenue, not monthly. So it comes out to about $5,100 per month. Not exactly retirement money, especially after expenses.

Speaking of which, here’s a list of my business expenses:

Recurring Expenses (paid monthly, totaled for the quarter)

• ConvertKit – $447
• Phone – $330
• LeadPages – $201
• Edgar – $147
• Internet – $120
• Wistia – $75
• Bluehost – $60

One-Time Expenses

• Travel – $755
• Camera – $731
• Assistant – $480
• Name.com – $105
• PayPal Fees – $54
• SurveyMonkey – $52
• Video Editor – $50
• Office Supplies – $48

Total Expenses = $3,601

As you can see, I’ve had some pretty big one-time expenses this year, including a trip to Atlanta for StyleCon and a new camera (both totally worth it).

But remember: as a business owner, you pay taxes on profit, not revenue. So spending money on stuff that will help your business grow is the right move, even if it decreases your profit.

For example, I could have used the same old camera I’ve been using for the past couple of years, but this new one is much better for video, and buying it reduced my taxable income for 2016 by $731.

It’s a win-win!

When it comes to personal finance, I’m relatively frugal. But if you’re trying to grow a young business, you should focus on increasing revenue, rather than pinching pennies to increase profits.

So, adding it all up (revenue minus expenses), Q1 2016 profit is:

Profit = $11,959

Definitely moving in the right direction. Definitely plenty of room for growth.

Goals for 2016

The primary goal hasn’t changed: help as many modest men as I can possibly reach dress better and feel more confident.

If I do this, I know I can achieve my business goal, which is to double revenue to a consistent $10k per month.

Specific milestones include:

1. Over 200k visits/month to the blog
2. 10k YouTube subscribers
3. 20k email subscribers

And of course I have some less quantitative goals, like redesigning this website and designing another garment (either another button up shirt or a pair of jeans).

Thank YOU!

None of this is possible without you. Thank you for your readership and support!