The Most Passive Business You Can Start With $20

Summary

Frey Chu describes building niche directory websites as low-cost, potentially low-maintenance businesses. The core work is choosing a focused market, assembling useful data, earning search visibility, and selecting a monetization model. The websites can become relatively passive, but results vary—and lead-generation models require sales work that Chu says he personally prefers to avoid.

Directory-building playbook

• Choose one specific user problem. A directory is a curated list that helps people discover options or make a decision. Avoid trying to cover many unrelated categories, such as every type of business in a city; focus on one clear audience and search intent.
• Look for an underserved search result.
  • Search Google for a relevant keyword plus “directory.”
  • Review the top results and check whether any receive meaningful organic traffic despite having relatively low domain authority.
  • Look for inaccurate or outdated information, poor user experience, or information that is hard to find through Google Maps.
  • Validate that the opportunity could attract substantial traffic and that users might return or have a meaningful purchase need.
• Assess whether the business can monetize. Consider the audience’s location, commercial intent, and what advertisers or potential lead buyers would value.
• Build around the data first. Chu uses AI tools to research and scrape information, then gives a coding assistant a plain-English description of the site and its data requirements. His example job board would combine job listings with employee contacts and a CRM to support referral outreach.
• Test, then invest. Chu says he usually has an early sense within 30 days—and more confidence within 60–90 days—about whether a site merits further investment, especially in backlinks. He recommends building and learning through repeated experiments rather than spending months perfecting a first site.

Growth and link-building tactics

• Use competitor backlinks as prospects. Find successful competing sites, inspect their backlinks in tools such as Ahrefs or SEMrush, and contact the sites linking to them.
• Offer a relevant resource and make the request easy. Chu asks for a link to a specific page, sometimes supplying a ready-to-copy sentence. He says a link swap can be effective when a close competitor is willing to exchange links.
• Use a five-sentence outreach email:
  1. Brief introduction and an “oddly specific question” about a named article.
  2. A personalized comment showing familiarity with the article.
  3. A clear offer to pay for a link placement.
  4. A concise explanation of the directory and the problem it solves.
  5. A personal founder note explaining that it is a side project, plus a low-pressure close.
• Price selectively. Chu says his offer depends on domain authority, site traffic, and niche. He often starts around $50 for common niches, may offer $75–$100 for stronger sites, and noted that some high-authority links were secured for $50–$75 or free. He reported a 7% response rate, with many respondents agreeing to place a link.
• Protect email reputation. He recommends using a separate sending domain, learning the basics of email infrastructure, and warming accounts for roughly two weeks before targeted outreach.

Monetization options

• Display ads
• Paid leads, lead forms, or per-lead sales
• Featured listings
• Digital products
• Paid educational content or subscriptions
• Affiliate links
• Additional tools layered onto a directory, such as a CRM or outreach workflow

Chu emphasizes that the best model depends on the directory. Ads are relatively straightforward, while lead generation can involve substantial follow-up and sales.

Examples and results shared

• Thrifting directory: Chu found an existing site receiving about 120,000 organic monthly visitors, but considered its information and presentation weak. His own site reached about 30,000 organic monthly visitors within six months and peaked around 90,000. Its first month with ads generated about $1,200; at its best, it made roughly $2,300–$3,000 per month, including ads and a $19 digital product. Chu said it generated about $150,000 over four years, while requiring around 30 minutes of work every four to six months at that stage. He credited a $50 link swap as an important contributor to rankings, while acknowledging other factors were also involved.
• Adjacent directory experiment: A third site reached about 20,000 organic monthly visitors in three or four months and typically earned roughly $300–$400 per month from ads, with a reported peak day of $326.
• Portable-toilet lead-generation site: A site with placeholder text on its homepage generated a $20,000 lead from the New Mexico State Fair. Other inquiries came from weddings, festivals, and film shoots. Chu considered the experiment a poor fit for him because he did not want to do the sales work required to convert leads.
• Crane-rental lead-generation site: Chu said a site focused on crane rentals in Laredo, Texas, received $5,000 and $23,000 leads within its first two weeks, plus subsequent leads. He said he had not yet done much with it.
• Entity-search directory: A site linking users to official business-entity databases reportedly attracted 42,000 organic monthly visitors at a domain rating of 21, about three months after launch.
• Power-outage map: Chu cited a site with a domain rating of 9 and about 134,000 organic monthly visitors, describing it as a strong potential advertising business.
• Trade-school directory: He highlighted a site with a domain rating around 1.4 and roughly 49,000 organic monthly visitors, whose searches could have strong commercial intent.
• Hotel hot-tub directory: A directory of hotels with in-room jacuzzis used affiliate links; Chu cited about 7,000 monthly searches for the relevant keyword and a few thousand monthly visitors to the site.
• Portfolio outcomes: Chu estimated he had built close to 15 directories and put his failure rate at about 30%. One site received acquisition offers of roughly $40,000–$50,000; the highest offer was about $50,000, which he described as roughly 3× annual revenue at the time.

Costs, tools, and operating lessons

Chu said the basic setup can be inexpensive: a coding-assistant subscription, a domain, and free tiers for services such as hosting, code storage, and databases. Paid backlinks and some data collection may add cost.

Tools he named included Claude Code, Astro, GitHub, Vercel, Supabase, Ahrefs, DataForSEO, and Resend. He also mentioned AI agents for ideation and scraping, and Reddit as a research source.

He argued that SEO remains useful, including for helping AI systems find information, but traffic sources differ by niche. For the thrifting site, he estimated AI referrals at around 5%; he also described a newly launched site receiving a notable share of traffic from ChatGPT.

A directory’s apparent simplicity does not eliminate execution risks: data quality matters, rankings are not guaranteed, and lead-generation sites may demand sales capabilities the owner does not want to provide. Chu’s central recommendation is to build, measure, and iterate without assuming quick profits.

Presenters and sources

Presenters: Chris Koerner (host) and Frey Chu (guest).

Tools and sources discussed: Google Search and Maps, Ahrefs, SEMrush, DataForSEO, Reddit, public databases, website analytics, and Claude Code. The video also contained a sponsored segment for Viktor.