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2018-06-14
Getting from $60 to $64 took a bit over four months, with a lot of passive waiting. Although this experiment is supposed to be as passive as possible, I think I can juice the returns by going back to flipping Craigslist electronics. As always, feedback and suggestions are welcome. Current balance is $64.63.
Update: 2018-06-19
Saw this ad on Craigslist this morning:
Seemed like a good deal. My plan was to get it and resell it for $60, simply improving the listing, doing screenshots of Netflix, YouTube, etc. It already had Ubuntu on it so seemed perfect.
I bought it, brought it to work and showed it to a colleague, who instantly wanted it. He promised to give me the $60 later. When that happens, we’ll be up to $89.63.
This was way faster than SVXY.
On a side note, you probably noticed that I’m not keeping track of my hours. It got too tedious for me. I figure as long as I don’t sell things like cookies + software development, I’m pretty okay.
I thought about creating a website where people can give me their old laptops and I wipe them and also sell them on that site. We’ll see. The cheap laptops with 4G of RAM that actually work come around once in a blue moon; I actually kept the last one I came across last year.
Update: 2018-06-22
Received the $60 yesterday. We’re officially up to $89.63. I was thinking of loading up on some OTM VXX call options a few days ago, but didn’t want to do so before I actually got the cash. The VIX has spiked since then and even though it’s down again today, the spike has already happened and I feel like I’ve missed my window.
Laptops like the $25 laptop I bought last year and the $35 laptop I was instantly able to flip to $60 do get posted on Craigslist but very, very rarely, to the tune of once every six months or more. eBay is a junk heap: it’s virtually impossible to find these there and shipping will kill the prices. I haven’t looked much on Facebook Marketplace but it’s probably the same story.
What if there were a way to accelerate the acquisition of these laptops?
I’ve found that the profile of the people that typically sell these laptops are older people who don’t need them anymore and don’t necessarily need the money either. I’ve also spoken to people who have old laptops, but don’t want the data on their hard drives being given away and have no idea how to securely wipe these hard drives. I’m wondering if I could solve this problem somehow: create a website for locally buying and selling laptops in Santa Barbara with the promise that I’ll securely wipe their hard drives in front of them.
This would of course require effort: setting up a website, etc., but I can do these things very easily so it wouldn’t be that hard.
Something to think about….
Update: 2018-06-23
I put this ad on Craigslist. We’ll see what happens:
Update: 2018-07-11
I got a couple of responses to the above ad: one from an individual looking to sell me one laptop. He sent a picture and I never followed up on it. (I should have at least replied – I feel guilty about that. Maybe I still will. The laptop didn’t look that great.) There was another response from someone looking to liquidate their computer business and give me a bunch of inventory, but he stopped responding after a few email back-and-forths and I didn’t follow up either. I doubt I could have purchased his inventory for $89.63.
My minimum criteria is 4G of RAM and I prefer laptops over desktops. I saw desktops for $75 and $120 for this price, but wanted to hold out for those ~$30 unicorns that I see from time to time.
Yesterday morning, this ad appeared and I jumped on it:
The listing had already been up for 22 hours, so I thought there was no chance. I texted the individual and she replied back later that morning. We arranged to meet at noon and I bought the computer. It’s not a laptop, but a very lightweight all-in-one unit and she was selling it for a ridiculously low price. It was apparently a present to her son from her ex-fiancé that she was going to donate to charity, but then decided to make a few bucks off of it. I went to the house and heard her interacting with her son, so this all seemed legit.
Unsurprisingly, the same colleague that bought the laptop from me at work agreed to buy this one for $50. I want to sell it to a lower-income Mexican friend of ours, but never heard back from her, so I’ll give her one more chance, then tell my colleague that I’ll sell it to him. He promptly paid me the $60 for the laptop last time, so I’m going to confidently book this as a gain, which would bring our total to $109.63.
When I bought the computer from this lady, she told me that there were (also unsurprisingly) lots of people who were interested, but she told them to hold off since I had confirmed I was coming over. This matched my previous experience where the gentleman complained that there were lots of Craigslist flakes. Although Woody Allen isn’t my role model because of the number of not-so-great allegations against him, his “80% of success is just showing up” quote seems particularly relevant so far: you see a good opportunity and you decisively jump on it before others do. I’ve had a number of life experiences where I’ve gotten ahead by just grabbing the opportunity while others hemmed and hawed about it.
Also note that my as-yet-unstated moral codes for these transactions are:
- Never surprise the seller with a lower price when I show up: always pay the stated price unless a lower price is agreed to beforehand. (I don’t have any qualms lowballing beforehand while being honest that I think they’ll get full price if they don’t sell to me.)
- Don’t try to resell these things for a much, much higher price. The $60 and $50 prices for my colleague are so he can gift them to friends in family who say that they can’t afford a computer and mentor them in coding; the prices are still a steal for the computer he’s getting and they’re given a very worthy second life.
Update: 2018-07-14
Last night, I saw this Craigslist ad:
Despite the diminished battery function, for these specs, the laptop seemed completely mispriced and I even wondered if it was stolen. I hopped on to eBay and confirmed that computers less good than this were selling for well over $100 more.
After hearing the horror stories of Craiglist and seeing how mispriced things are there and how flaky the buyers are, I figured that eBay folks are a savvier audience and this would be a good candidate for reselling on eBay. I’ve never sold anything but digital goods there before (which happened to violate the Terms of Service (which I didn’t know) so the listings were quickly taken down), but I did buy a ton of electronics from eBay back in the day so have a halfway decent notion of how things work.
I shot off an email to the seller last night and got a response this morning. Unsurprisingly again, several people were interested and it was just a matter of my getting there first, which I did.
I found out quickly enough that the deal was legit. It was a fellow software developer who only used his work laptop and hadn’t needed this one for several years. We had a nice chat (I’m sort of enjoying the social aspect of these deals), I checked out the laptop and it seemed fine, and bought it for $80. He was young, surely in his 20s, so this breaks the stereotype of only older people selling mispriced laptops.
I cheated slightly on this deal because I haven’t received the $50 from my colleague yet, but he assured me Friday that he’d have the money by Monday and I know he’s good for it. That said, technically, I didn’t have the money to pay for this, but I bent the rules slightly.
Now I need to figure out how to create an eBay listing for this.
Update: 2018-08-27
Finally got around to creating an eBay listing for this laptop (with help from someone I’m grateful to):
https://www.ebay.com/itm/2013-Lenovo-Ideapad-U410-Laptop-SSD-HD-Adapter/263898587865
I thought it would sell instantly, but it didn’t. Funny thing is the laptop sold this morning, probably moments after I made this post.
I delegated the task of shipping the laptop to someone and told her to let me know if if cost more than $20, which is what I estimated the total cost of packing + shipping at. She took it to the UPS store and they charged her $12 for packing and $28 for shipping, and she thought it was okay because the $12 came under the $20, I had mentioned. Total shipping cost was $48.04. I listed the laptop for $199.99 on eBay and after eBay and PayPal fees, we got $190.89.
I have very mixed feelings about this transaction. On the one hand, mathematically, it was a huge win: net profit is $190.89 – $48.04 – $80 = $62.85 off of an $80 purchase, or almost a 79% gain. On the other hand, the gross profit could have been way higher if I had figured out a way to cut out the shipping, eBay and PayPal fees. Should I have tried harder to sell this locally first? (I don’t regret having gotten the eBay experience, but I made zero effort to sell this locally because of my fears of Craigslist flakes and local mispricing.)
Anyway, what’s done is done.
Our current pot is at $62.85 + $109.63 = $172.48.
I’m itching to do another VXX call trade. The market shot higher today on Trump’s Mexico trade thingy (NAFTA not NAFTA) and VXX / SVXY have been rangebound for a very long time.
Update: 2018-09-15
Haven’t done any trades or new purchases yet. That said, I just realized I’ve blown past a new power of 2. Woot! $256 – here we come!