How to Make Money Building Free Tools

Invest before this company becomes a household name

What if you had the opportunity to invest in the biggest electronics products before they launched into big box retail, would you?

Ring changed doorbells and Nest changed thermostats. Early investors in these companies earned massive returns, but the opportunity to invest was limited to a select, wealthy few. Not anymore. RYSE has just launched in 100+ Best Buy stores, and you're in luck — you can still invest at only $1.50/share before their name becomes known nationwide.

They have patented the only mass market shade automation device, and their exclusive deal with Best Buy resembles that which led Ring and Nest to their billion-dollar buyouts.

Learn how you can become a shareholder.

Want to get in front of 9500+ founders, entrepreneurs & marketers? Sponsor this newsletter.

💡 Opportunity #1 - Building Free Tools

🗂 Overview:

I came across this post on Indie Hackers a few months ago and with the recent Google SEO apocalypse I think it’s time we break down how you can take advantage of it.

The idea is to help businesses grow by building free tools that provide real value for their target audience. Building tools that help solve problems that customers face will increase the likelihood of that tool being used, shared and spoken about.

Here’s a great video by Alex Hormozi that explains why giving things away for free will make you more money in the long term.

AI can help you rank higher on Google but not in the way most people think. “Writing” 1000 AI-generated blog posts will just get your content marked as spam and unhelpful. But creating tools people use and share will drive leads, backlinks, word-of-mouth and growth by providing actual value to your target audience.

AI wrapper businesses aren’t viable in the long run as standalone businesses that people pay for. Either, OpenAI will release a new feature that kills your business or someone else will. However, building free tools that solve a specific problem and rank for specific keywords can help achieve hyper-growth in both the short and long term.

Beyond this, if you can train your own custom AI models you’re going to have an even bigger advantage. Here’s how to build your own LLM model and here’s why it’s better/easier than you think.

These free tools also don’t even need to be AI-related at all. Tools like Free Convert or UberSuggest from Neil Patel or even HubSpot’s suite of free tools have had massive impacts on their SEO growth and none of these are AI-related.

⭐️ Examples:

• Makerbox saw huge growth with three of their free AI tools. Two of them made it to #1 Product of the Day on Product Hunt and the other made it to #2. They collected nearly 14k emails from this and went from $5k/m to $20k/m within 5 months.

• Pallyy’s first customer came from a free tool. They now do over $75k/m in recurring revenue.

• Morgan has built 20+ free tools for his business that helped grow his website traffic from 1k to 50k/m.

• Boost AI Traffic is a Twitter account that shares AI tools people are creating and their performance. Definitely good for some inspiration if you’re looking to build AI tools.

• HubSpot’s free Website Grader was the first ever project they released in 2007, they’ve since released a whole suite of free tools designed to rank for SEO and generate leads.

• Neil Patel has built and bought a few tools like Ubersuggest (3.3 million active monthly users) and Answer the Public (2 million monthly active users). These tools helped cement Neil Patel as one of the go-to sources for SEO and marketing. Not only this but his agency has bootstrapped to over $100m in revenue.

👎 Problems:

• Customer Acquisition: By offering valuable free tools, businesses can attract new customers who are seeking solutions to specific problems.

• Brand Loyalty: Providing genuinely helpful tools can increase customer trust and loyalty to the brand.

• Market Differentiation: Unique or superior tools can differentiate a business from its competitors, making it stand out in the market.

• Increased Engagement: Engaging tools can lead to higher website traffic and longer visit durations, improving SEO rankings.

• Data Collection: Free tools can serve as a means to gather useful data about users’ needs and preferences, informing future business strategies.

• Content Marketing: Tools create opportunities for content marketing, as they can be featured in blogs, tutorials, and case studies.

• Viral Potential: High-quality tools have the potential to be shared widely, increasing brand visibility without the need for paid advertising.

• Feedback Loop: User feedback on free tools can guide improvements and innovation, keeping the business relevant and ahead of trends.

• Lead Generation: Tools can include optional sign-ups, converting users into leads for more personalized marketing efforts.

• Partnership Opportunities: Collaborating on tool development or integration can open up new partnership avenues with other businesses or platforms.

• Cost Efficiency: Digital tools, once developed, can offer ongoing benefits with relatively low maintenance costs, making them a cost-effective marketing strategy.

🧐 Opportunities:

Opportunity #1: Build Tools for Businesses

This is a simple service-based business model (perhaps a productized service) where you create free tools for businesses that are designed to help them:

• Rank on Google (improve SEO) by providing value and solving problems for specific keywords as well as generating more backlinks.

• Create more organic content for TikTok, YouTube, Blogs, and newsletters as AI-related influencers, social accounts and newsletters will feature the tool for free.

• Generate more leads and sales by collecting emails and upselling paid products/services.

• Launch on Product Hunt and similar sites helping generate free traffic, leads, sales and authority.

You can create tools for almost any niche. This can include accountants, lawyers, nutritionists, travel, real estate and so on. Once you pick a niche and build a few of these tools, you can create templates to speed up the development process.

You could work on a monthly retainer where you build a new tool for your clients every month or a one-time fee where you build one/many tools for them. You could potentially also explore a pay-per-lead model where you track how many leads you bring from the free tools - this is a little more tricky but provides a risk-free approach for the client.

Opportunity #2: Build Tools for Yourself

This is less of a business idea and more of a marketing strategy. If you run a business, creating these tools, as already mentioned, can be a huge driver of growth.

Opportunity #3: Sell Free Tool Templates

Taking inspiration from sites like CodeCanyon, you could create free tools that users could white-label and use to generate leads/sales without having to pay for development.

This means you can make something once and sell it an unlimited amount of times. Meaning you don’t need to manage clients or do repeatable tasks.

The advantages are a little bit less for the end-user as they won’t have a clear USP vs their competitors and they might not see as much success. But it’s still a good way for them to test free tools without having to spend too much money upfront.

🛠 How to Build:

• Identify the Niche: Begin by pinpointing which niches could benefit most from free tools. Look for sectors with high demand for digital tools and a gap in the market.

• Understand your Niche: When developing tools aimed at enhancing rankings, you need to understand the search patterns and activities of your target audience. Knowing their preferences, aversions, and online haunts enables you to create tools that seamlessly align with your core business objectives.

• Develop a Portfolio: Create a few sample tools or prototypes to showcase your capability in solving industry-specific problems. This will be crucial for demonstrating value to potential clients.

• Set Up a Business Model: Decide how you will monetize. While the tools might be free for the end user, businesses might pay for customization, premium features, or a subscription model for ongoing support and updates.

• Launch a Pilot Project: Partner with a client willing to pilot your tool. Use this as a case study to gather data, testimonials, and refine your offering.

🚀 How to Grow:

1. SEO Optimization: Improve search engine ranking to increase visibility to businesses searching for tool development services. Perhaps by creating free tools for your ideal target market as well.

2. Content Marketing: Create valuable, niche-specific content to attract and engage potential clients.

3. Social Media Marketing: Use platforms like LinkedIn for B2B networking and showcasing your projects.

4. Email Marketing: Send targeted campaigns to nurture leads and keep your business top-of-mind.

5. Referral Programs: Encourage current clients to refer new clients by offering incentives.

6. Webinars and Online Workshops: Host educational sessions that demonstrate your expertise and tools’ value.

7. Direct Outreach: Use personalized emails or messages to connect with potential clients directly.

8. Partnerships: Collaborate with complementary businesses or industry influencers to broaden your reach.

9. Paid Advertising: Invest in PPC campaigns targeting keywords relevant to your niche services.

10. Case Studies: Showcase the impact of your tools through detailed case studies shared on your website and social media.

11. Client Testimonials: Leverage positive feedback from clients as social proof on your platforms.

12. Free Trials or Demos: Offer a free trial or demo of your services to provide a risk-free way for potential clients to evaluate your tools.

13. Speaking Engagements: Secure speaking opportunities at industry events to establish thought leadership.

14. Interactive Content: Develop quizzes, calculators, or interactive assessments that can engage potential clients on your website.

🤯 Recommendations