By Lisa Johnson business strategist (www.lisajohnson.com)
Passive income is often thought of as a new concept. An online phenomenon, often with more than a hint of slightly untrustworthy connotations, but the principal of making passive income has been around forever.
Put simply, instead of one to one, think one to many. In other words, rather than only ever serving one client at a time, create a model that provides the same or a similar service to many people at the same time. Time is not limitless. If you continue to only work on a one to one basis, there will always come a time when you run out of hours in the day to see more clients.
So, in its simplest form, renting out your spare room is passive income.
Here I’ll briefly cover five different ways to make this system work effectively and therefore, profitably. Ways that I have focussed on in my business, and have helped to see my hours drop to somewhere around 30 a month, whilst turning over multi millions and spending all summer travelling with my family.
With most of these options, you will need to put in the effort at the beginning to create the content and the plan. But once it is in place, you can continue to use the same model and the same content over and over again, with a different cohort of clients each time.
- Online Programmes – I believe the definition of an expert is the person who knows the most about a particular subject in an average sized room. Everybody has something they can be an “expert” in. Think about what you know about – things you take for granted. This could be something learnt in employment, a hobby or interest, or just life skills. In an online programme you teach your knowledge live online for a speciﬁc period of time. Let’s say, using the wedding business as an example, a six-week course for couples on how to plan their wedding. But this could easily be how to train your dog, how to make a perfect cupcake or how to be great at interviews! There is no limit. The information is usually drip-fed, like in the old days, when we would have had to wait for next week’s episode in a TV series.
- Online Courses – These are usually a more passive version of a programme. The learnings might be recorded videos or they might just be workbooks and people are more likely to be able to complete the course whenever they like. These can be a more budget friendly option, and they have the advantage that all the content is created in advance, therefore, once it is written, it is a true passive income product.
- Online Memberships – Memberships are a real opportunity to bring together people with similar interests, skills and ethos. Using weddings again as an example, you might have a Facebook group to chat to other people planning their wedding and there might be guests who come in to teach people how to arrange the flowers or the etiquette when an auntie wants to invite her twenty closest friends. It’s less learning, more hanging out with like-minded people. I have seen memberships for knitting enthusiasts, for surfers, for book lovers – the possibilities are endless. The big advantage here is that if you’re tired of the online cliques, where everyone seems to be speaking some secret code half of the time, then you can start your own membership, and make it look and feel exactly how you want it to.
- Workshops or masterclasses – The are usually a one-oﬀ class online for an hour or maybe two, covering one subject. Using our wedding example again, it could be ‘What You’ll Need to Plan for your Wedding and When’. You can use audio, video, workbooks, live recorded sessions, tasks, activities. You choose what you work best with and what you are most comfortable with.
- Writing an Ebook – If people say to you, ‘Can I pick your brain?’ about a speciﬁc subject, then creating an ebook is a great way to spread your message and generate another revenue stream. Just think of all the questions you are asked over and over again (or ones that you see asked repeatedly on social media) and remember them – because this is the content that will be gold. While there are a lot of ebooks out there, if you create one that is focused on what you know your clients want to know, there will be a market. Also, the good news is that people love reading ebooks on their phones as much as on their computers, so there is additional demand this way.