In Q2 of this year, we brought in over $56,000 from our YouTube channel and other related income streams! The numbers in this report feel completely crazy to us, but it hasn’t always been this way. If this is your first time ever reading one of our income and expense reports, I suggest starting with the first one we ever published in July of 2016 (our total income was $603.26)
Now that we’re making a significant amount of money from this business, I feel like it’s important to tell you why we started writing these reports in the first place. It is NOT to brag about how much money we’re making. Trust me, when we first started sending out these reports, we were actually losing a lot of money!
There are three major reasons we started sending out these income and expense reports:
1. I (Nate) am a business nerd! I always wonder how much money people are making and exactly how they’re making it. I wish more people would transparently share their entrepreneurial journey; so that’s why I do it! When other people do it, I find it inspiring and incredibly interesting! So I hope you’re inspired or at least entertained when you read these.
2. When Kara and I tell people that we travel full-time, the response we get the majority of the time is, “I wish I could do that.” At this point in the conversation I usually just bite my tongue. I realize that, for some, full-time travel truly isn’t possible. But for most of the people who say “I wish I could do that,” they could if they really wanted to. Yes, some people would have to work harder than others, but most people could make it happen if they were willing to make travel a priority.
A couple years ago, Kara and I made travel our top priority. We saved up money for over a year, we moved out of our apartment, we sold our cars, and we quit our jobs. Now we put in the work (almost) every day to be able to afford to continue traveling. We hope that by sharing this report each month, it will inspire some of you to go from “I wish I could” to “How could I.”
3. We’re not special, and we want you to remember that no matter where this journey takes us. I feel like once people become “successful” it’s easy to think they’re “special,” and that’s why they were able to achieve success. Our hope is that by sharing this journey from the beginning you’ll be able to see that two regular people had a crazy dream and worked hard to make it a reality. In turn, we hope this will inspire you to dream a big dream and go after it.
Thoughts on Quarter 2 of 2018
Last quarter I was in slight disbelief of the big numbers we were posting in our income and expense report. This quarter, we doubled our profits from last quarter… After two years of barely scraping by (financially), it feels surreal that our YouTube channel is turning into a real business that’s making real money.
Our channel is continuing to grow at 700 – 1,000 subscribers per day, and that growth is directly translating to substantial growth in all of our major revenue streams, but we’re not just sitting back on autopilot. We don’t know how long we’ll continue growing at this rate, so we’re trying to capitalize on the opportunity by creating additional income streams.
I’m really excited about both of the new income streams we created this quarter. First, Kara created an online course that teaches exactly how she edits our videos. Tons of people have asked her about her editing process, and I finally convinced her to take a week off from editing our videos to sit down and record her entire editing process.
If you want to watch over Kara’s shoulder as she edits one of our travel vlogs, click the link below to check out the course.
Second, I was finally able to get approved for the creditcards.com affiliate program. This affiliate program allows us to earn a commission anytime someone signs up for a credit card I mention on our blog or in my travel hacking course. We were already promoting these credit cards because they can help save travelers a ton of money. So, it’s nice to finally be rewarded for the referrals we’re sending their way!
Since travel credit card offers are constantly changing, I’ve started publishing a new blog every month ranking the top travel credit cards. If you want to see how much you can save on travel by signing up for one the top cards, check out my most recent post.
If you find this post useful, we’d really appreciate it if you use our links to sign up for your next card.
Ok, let’s dive into the nitty gritty details of the Q2 report!
1. YouTube Ad Revenue – $15,609.34 (Change from Q1 +$1,425.34)
Once again, we made more money than I ever thought we’d make from YouTube ad revenue. This quarter our views increased from 8 million to 10 million, and almost 50% of those videos were monetized. This means YouTube showed an ad on the video, and we split that ad revenue with YouTube.
So even though we’re splitting pennies with YouTube on each ad that’s shown on our channel, those pennies really start to add up as our channel views continue to increase. I’ve also noticed an increase in ad rates when we post videos from luxury destinations. So, the Maldives was a nice little bump for us. I assume that’s because advertisers are paying more to reach people who would potentially spend a lot of money to visit those destinations.
2. Patreon & PayPal – $8,381.01 (Change from Q1 +$1,880.01)
It’s scary to build a business on top of a platform that you don’t own. So much of our success/failure is tied to the growth of our YouTube channel, and we have very little control over that growth. For the second quarter in a row, YouTube has continued showering us with new subscribers. So, I’m starting to get more optimistic that the growth will continue, but in the back of my mind I’m always a little nervous YouTube will turn off the subscriber faucet, and we’ll be back where started.
This is why we’re so grateful for our patrons! Thanks to their support, we know that no matter what YouTube decides, this is one consistent source of income that we can count on every month!
For those of you who aren’t familiar with Patreon, it’s an online platform that allows you to support the work of your favorite creators giving them a chance to continue working on their creations without having to worry about where their next meal is going to come from!
3. Course Sales – $16,349 (Change from Q1 +$7,674)
We saw a huge increase in course sales this month because we now have 2 courses for sale! We’ve each created an online course to teach others the subjects where we have the most expertise. For me, that’s travel hacking, and for Kara, it’s video editing.
- 30 Days to Becoming a Travel hacker is a course I created to teach others the strategies I use to save thousands of dollars on flights and hotels.
- Kara’s Behind the Scenes Guide to Creating a Vlog is the course Kara created to let you watch over her shoulder and learn the exact methods she uses to create one of our travel vlogs.
As you can see from the chart above, we had a huge spike in course sales toward the end of May and beginning of June. That was the first week Kara launched her course, and we put a lot of effort into promoting the launch. It paid off because, in the first week, she sold over 50 courses!
Money aside, I’m super proud of all of the effort she put into creating the course. It took me a long time to convince her into making it because she didn’t think she was good enough, and she was scared people wouldn’t like it.
As I suspected, the exact opposite has been true! She’s received tons of good feedback, and she’s empowered almost 100 people with the ability to create beautiful and engaging videos.
If you’re interested in learning how to edit videos, you should really check it out – Kara’s Behind the Scenes Guide to Creating a Vlog
4. Affiliate Income – $12,356.42 (Change from Q1 +7,377.42)
- Amazon – $1,502.55
- Epidemic Sound – $1,800
- Creditcards.com – $2,442
- The Paradise Pack – $5,964
- Other – $341
The majority of our affiliate income comes from the ongoing promotion of companies we love such as Amazon and Epidemic Sound. This quarter however, we made the majority of our affiliate income from a one week affiliate promotion of The Paradise Pack.
The Paradise Pack is a huge collection of online resources that help people save money on travel and work from the road. Once per year my friend and travel hacking mentor, Travis Sherry, bundles all of these resources together and sells them for a HUGE discount. The catch is that the discount only lasts for one week. If you miss it, you have to wait until the next year to buy it. This year, there was over $5,000 worth of online resources being sold for $497.
We were honored to have Kara’s new course included in this year’s Paradise Pack. By including Kara’s course in the Paradise Pack, we were able to earn a 50% commission when someone purchased the pack using our link. This one week sale made us over $5,000 in affiliate income!
While $5,000 is a big chunk of change, I get much more excited about by the consistent streams of passive income through our ongoing affiliate promotions.
Up to this point, our biggest stream of affiliate income has been Epidemic Sound (around $1,000 per month). We get all the music for our YouTube videos through this service. It’s hard to find good music for YouTube videos. Kara used to waste hours of her life searching for music, and now she has a huge library of royalty-free songs to choose from! She loves this service, promotes it at the end of all of our videos, and we get paid anytime someone signs up for a free trial.
If you need music for YouTube videos, click here to check out Epidemic Sound!
I’m super excited about the potential of the creditcards.com affiliate relationship because in the first full month of promotion we were able to generate over $2,000 in income. My goal is to be consistently making $5,000 per month by the end of the year!
And last but not least, Amazon also brought in a decent amount of affiliate income. It’s pretty awesome that we made over $1,000 just by recommending products we use and love. The majority of our Amazon affiliate income is generated by people who visit the following pages.
5. Video Licensing – $45 (Change from Q1 -$455)
We aren’t proactive about seeking out sponsored videos or video licensing deals. However, sometimes they come to us. This quarter fewer people reached out to us than usual, but we were still able to sell a clip of sleeping in the airport for $45. At least there was a bit of a silver lining to having to sleep in the airport, although I would have gladly paid $45 to have not missed our flight.
5. Sponsored Content – $3,500 (Change from Q1 +2,000)
As our channel grows we’re getting more and more opportunities to include sponsors in our videos. It seems like every day someone sends me an email asking us to review their product on our channel. We turn down the majority of these offers, but if the product/company meets our 3 criteria, then we entertain the idea of adding them as a sponsor.
- Can we get genuinely excited about the product/company?
- Is this something we think our viewers would be interested in knowing more about?
- Does the company value our platform, and are they willing to pay us enough money?
This quarter we published 33 vlogs, and 2 of those videos were sponsored. Our first sponsor was Quip. Quip is a toothbrush company which, admittedly, doesn’t scream perfect fit for an audience of travelers. However, I had almost purchased a Quip toothbrush for both of us last time we were in the United States because it looked like the perfect electric travel toothbrush. Once they sent us the brushes, we confirmed they were awesome and were really excited to promote them.
We also worked with Audible. I LOVE Audible and listening to audio books when we travel. So, when Audible reached out it was a no-brainer. We’re working on creating a long-term relationship with them so you’ll probably hear more about Audible soon!
The pie chart above gives you a quick breakdown of how each revenue stream is contributing to our total income.
Transportation Expenses – $1,737.09
Normally, we save money on our transportation expenses using miles and points that we’ve saved up by applying for the best travel credit cards. However, this month we were able to save all of our miles and points and still lower our cost thanks to a few sponsored flights.
Turkish Airlines was kind enough to sponsor our flights (in business class) to and from the Shorty Awards! We didn’t know if we would win a Shorty Award, and we debated for a long time whether or not it was worth spending the money to fly from Bali to New York to sit through an award ceremony where we would potentially lose. Thankfully, Turkish Airlines sponsored the flights so we didn’t have to make the tough decision.
Also, Epidemic Sound flew us to and from Stockholm so we could attend their annual company party as a way to say thank you for promoting their service!
I should probably add a lot of exclamation marks behind all of the sentences in the section above, because I don’t say these statements flippantly. This is a huge deal for us to get sponsored flights and we’re super grateful for both Turkish Airlines and Epidemic Sound!
|Kuala Lumpur||New York||Plane||$0||Partnership with Turkish Airlines|
|New York||Maldives||Plane||$0||Partnership with Turkish Airlines|
|Maldives||Sri Lanka||Plane||$110||9,000 British Airways Miles|
Accommodation Expenses – $465.86
Our accommodation expenses seem to keep getting lower. Thanks to Airbnb credits we receive from referrals, hotel points, a couple sponsored trips, and good friends we were able to keep our accommodation expenses crazy low this quarter!
|New York||Friend's House||5||$0||Thanks!|
|Maldives||Hotel||3||$0||Partnership with Soneva|
|Sri Lanka||1||1||$35||Thanks Mom & Dad|
|Cairo||J.W. Marriott||9||$0||Redeemed Marriott points|
|Sweden||Hotel||5||$0||Partnership with Epidemic Sound|
|Italy||Friend's House||30||$0||Thanks B&G!|
Destination Expenses – $2,424.86
This category is the money we spent while on the ground at each destination. This includes things like food, local transportation, and entertainment. Let’s be honest though, most of this spending probably went towards delicious local food.
|Myanmar||April 1 - 2||$22.54|
|Bali||April 2 - 11||$373.51|
|Kuala Lumpur||April 11||$45.51|
|New York||April 12 - 18||$352.70|
|Maldives||April 20 - 24||$119|
|Egypt||April 25 - May 13||$443.17|
|Turkey||May 13 - 24||$594.01|
|Sweden||May 24 - 30||$270.61|
|Italy||May 30 - 31||$50|
Business Expenses – $3,489.55
Each month we pay for several online subscriptions and other things to keep the vlog, blog, online courses, and email list running smoothly. I look at most of these expenses as “investments” instead of expenses because most of them are tools that enable us to make money.
Partnerships Manager – $2,030
In addition to helping us secure partnerships, Benji also manages our private travel hacking Facebook group, writes blog posts, and helps with credit card consultations. I guess it’s time to think about updating his title…
Convert Kit – $311.16
The great email platform that we use to send emails to our email list of 25,000+ people
Teachable – $297
The platform where I host my course “30 Days to Becoming a Travel Hacker”, “The Mistake Fare Manual”, and now Kara’s new editing course.
Premiere Pro – $98.28
The program Kara uses to edit our episodes
Google Service – $55.14
This is the money we pay Google for our email address every month so that we can look semi-professional.
Touchnote Postcard – $167.40
This is the service we’re using to send postcards to our patrons!
Epidemic Sound – $45
This is where we get all of our royalty free music for our YouTube videos!
TubeBuddy – $57
This service allows us to bulk edit the cards and end cards across all of our videos on YouTube. Basically, we pay $19 to avoid spending hours of our lives monotonously changing cards on our channel.
Motion Array – $57
We bought some cool new transitions for videos from this service.
Express VPN – $25.90
We had to buy a VPN so we could access YouTube on our river cruise and upload our videos.
Equipment – $328.23
While we were in Sweden we had to buy a new hard drive and microphone for our camera.
Fixed Costs – $1,157
T-Mobile Phone Plan – $374.28
Health Insurance – $558
Google Fi – $189.33
It would be irresponsible to travel without health insurance, so we pay what feels like too much money for an international health insurance plan every month. We’ve been really happy with our T-Mobile Unlimited International plan for the past 18 months. However, last quarter I decided to switch to a Google phone and try out Google’s phone service called Project Fi. So far it’s superior to T-Mobile’s international service, but I accidentally continued paying for T-Mobile for a couple months :/
Miscellaneous – $821.97
This category is made up of expenses that didn’t fit into any of the categories above. Some little things like Spotify and Netflix and a few bigger things like credit card annual fees and birthday presents for friends and family.
Total Q2 Expenses – $13,959.44
|YouTube Ad Revenue||$15,609.34|
This is how much money we saved this month thanks to partnerships, frequent flyer miles, and referrals. This is just a fun vanity metric to calculate. If you love numbers like me, it’s fun to look at how much money this quarter “should have” cost us.
Hotel Points- $1,470
Before Kara and I left to travel full-time, we saved up almost 2 million miles and points! We’ve used these miles and points to save over $25,000 on travel expenses. If you want to learn how to do the same check out my course 30 Days to Becoming a Travel Hacker!
JW Marriott Cairo – $1,470
Earlier this year we redeemed 270,000 Marriott points for a Nights + Flight package. This earned us a 7-night certificate which was good for a free 7-night stay at any Marriott category 1-5 hotel. We also got 132,000 United miles to redeem towards free flights. We cashed in our 7-night certificate for this stay. It costs $210 per night for a room at the Cairo JW Marriott. So, the total value of this certificate was $1,470!
Partnerships – $24,890
Every month our YouTube channel gets over 3,000,000 views, which gives us opportunities to partner with companies for free experiences/accommodations in return for featuring them in our videos. Below are partnership exchanges we participated in this quarter.
Bali Customized Tours Day Trip – $150
Turkish Airlines Business Class Flights (KUL > NYC > MLE) – $13,000
Soneva Maldives Experience – $7,000
Istanbul On Food – Food Tour – $120
Pyramids Day Trip – $120
Nile River Cruise – $3,900
Epidemic Sound Stockholm Trip – $1,600
Airbnb Credits – $580.84
When someone signs up for Airbnb using our link, they save $40 on their first stay. Plus, we get between $20 – $40 when that person completes their first trip!
It’s a win-win, and we wanted to say thank you to everyone who has signed up and taken a trip using our link!
If you want to save $40 on your first Airbnb stay, click the link below to create an account!
Total “Savings” – $27,940.84
That’s a wrap for our Quarter 2 income and expense report. These reports are getting more and more unbelievable. If you find it hard to believe that we’re making this much money while traveling the world, you’re not alone. We’re having a hard time believing it too! Thank you for all of your support. We couldn’t do it without you. I’d love to hear what you think about this report in the comments below!