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Recently I was reading an interview with Warren Buffett (the most successful investor of all time), and he mentioned that one of the key principles to achieve wealth is to diversify your investments over time.

The principle is not new (e.g., never put all the eggs on one basket), but while reading it I realized that most of us (myself included) forget to implement it quite often.

If you are an online entrepreneur you should diversify not only your investments but your income sources as well. For instance, don’t rely on a single advertising network or on a single income stream, like ebook sales. Apart from reducing your risk this strategy will tend to maximize your earnings over time.

Darren Rowse recently wrote a really interesting piece on this topic, where he shares the various income streams he developed on his websites over time. Here’s a quote:

I also would say that in each case, I started each experiment not really knowing what I was doing (on at least some level) but really seeing the experiments as a chance to learn. For example, my first eBooks were taking previously published blog posts and updating, completing and adding to them to offer readers a more convenient way to access my content.

At the time I had no idea if that would work and the design and delivery of the eBooks was fairly basic. In time I learned what did and didn’t work and was able to grow the sophistication of my delivery systems, design, authoring and marketing to the point that it’s become a fairly well-oiled machine.

The key is to pick something to try and to see whether it connects with your readership and to learn as much as you can while you’re doing it.

Bottom line: diversify your investments and income sources.


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About the author 


Daniel Scocco is a programmer and entrepreneur located in São Paulo, Brazil. His first company, Online Profits, builds and manages websites in different niches. His second company, Kubic, specializes in developing mobile apps for the iOS and Android platforms.

  1. Great article. Multiple sources of income is the best way to ensure that the websites is not over reliant on only one source.

    Many websites purely run on adsense, however not getting enough traffic can mean very low earnings.

  2. This is very true, and often hard for people to actually execute in practice, especially when they are younger (20’s/30’s). I think another piece to this puzzle is setting aside creative thinking time to identify new opportunities that may be right in front of you and ‘untapped’.

  3. Great post, I agree that you should never put all your eggs in one basket and really diversify your income streams.

    How many times have we seen people who have built a huge adsense business only to have their account banned and lose everything overnight.

  4. When I was in my 20’s I read the book Multiple Streams of Income which I highly recommend. Everyone should apply these principals to there life.

  5. Diversification is what i will start doing, one thing i learnt from what Warren Buffet said is that if i ivest in one and it looses i am gone but if i invest in many and some loose, i still have others to keep me out of risk. A Great tip from the great man 🙂

  6. Ya that 100% true…It will be very hard to recover if our most depended source failed to make money…for example if we depend on adsense only,it will be very hard if our adsense account is blocked…Its always good to have more than one option…Thanks for sharing his great words…


  7. Very good post. When someone develops multiple sources of income they give themselves an exponentially larger chance of finding some true success in any entrepreneurial venture. I strongly agree.

    -Ryan L

  8. Great post Dan!

    Having diversified sources of income surely is extremely helpful for any entrepreneur, even if just one of those income sources is necessary to sustain one’s current lifestyle. It’s like having those redundant organs (think kidneys) in your body — if one fails, you still have another usable member.

  9. Diversification of income sources is good especially if the blogger knows where and when to diversify. Luckily, we get to see people like Warren Buffet and Darren Rowse who have cult followership and teach them how to diversify their income sources.

    Having said that, I agree that diversification reduces risks and can help maximize earning over a period of time. Bloggers should really consider this and spread their investment or income stream tentacles!

    The above comment was shared as the above post was “kingged” in the IM social site – kingged.com

    Sunday – kingged.com contributor

  10. More different sources of income more would it be difficult for us to track… besides switching mind between stuffs is difficult

  11. Well said! Diversification is the key to success and this goes to all kinds of endeavor be it in a relationship or business. This is just like saying it is better to have multiple business ventures so as to have a fall back when one does not perform well or not earning at all.

  12. However, diversifying too much will weaken the focus. A opposite saying goes “put your eggs in one basket and keep an eye on it”. So I guess we should diversify only to a number we can handle.

  13. Facing the same dilemma for some while now. It’s funny how Darren says what all of us already know (at least on some level)- you start by taking a guess, making a try… Then it only refines itself.

  14. I’m trying to invest in CPC, now I’m going to build a website and advertising Diversity


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