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There is a trend of people starting side hustles as a way to supplement their income. The great thing about this is more people are becoming interested in being entrepreneurs and investors. This means that more people are breaking free from the limitations put on them by the traditional education system. The more people create and invest in businesses, the quicker we can improve the world. That is what is so great about capitalism!
But while it is great that so many people are taking steps to start their own businesses, side hustle culture has some bad aspects. Often by framing businesses as side hustles, people self-sabotage their chance at starting a real, sustainable business. I believe when you start any business, you should see its potential to be something bigger. That doesn’t mean you should quit your job and put all your time into your enterprise before you can afford to do so, but it does mean having a plan for it to grow.
If you treat your business as real from the start, you can achieve life-changing results much better. As a multimillionaire property investor, trainer and businessman, I want to see as many people succeed as possible. In this article, I will give you three tips on ensuring you treat your new enterprise as a serious business rather than just another side hustle.
1. Find your income replacement number
When you first start your business, you will need to continue to work a job to afford to live. But at some point, it will make more sense to focus on your business. You need to work out how much money you need to make a month for it to be possible for you to quit your job. Remember that when you are running your own business, each month will be different, so you will want to build some contingency into that number.
Once you start earning the amount you need, you should wait to see that you consistently earn this amount or more over months. Once you consistently earn enough money, you can decide what you want to do. You may choose to cut down the hours you are working to focus on your business, quit your job entirely or stay in your job and be more financially secure. Which option you choose will depend on your risk tolerance.
2. Systematise your business
When you first start in business, you will effectively be a self-employed worker. You will have created another job for yourself. Once you start making some money, it is time to start systematizing your job into a real business. You will need to document everything you do so that you can transfer your work to employees, contractors or service providers when the time comes. You should also use the latest industry software to automate as many things as possible.
As soon as it is financially possible, start to find people who can do parts of your work. Start by finding people to do the jobs you like the least, and keep doing what you are best at. Over time, you can step back into a managerial role. You should create an editable training manual for each role, adding answers to any new questions your employees ask. Over time, this will mean that you have to intervene directly less and less, as your employees will have a comprehensive book of answers they can refer to.
3. Make your business passive
Now that you are in the manager role, it is time to transition to owner status. You will now need someone to take over your management role. This will make the business passive for you. You can then work on building the business at a high level. You can also start to build new parts of the business or start a complementary business that fits well with your existing offering.
Having a business that you own, rather than one that relies on you to work within it, means your business has a value. How much your business is worth will depend on your industry and size of business. However, businesses are often worth 3-6x annual earnings. Down the road, you may wish to sell your business or raise capital to grow it. Therefore, having a business that can be valued in this way is very important.
All this differs greatly from what most people think about when starting a side hustle. The side hustle mindset is limiting, whereas the business mindset has unlimited possibilities. Whatever industry you are in and whatever size your business is, I hope this article has helped you to look at it from a fresh perspective.