BENEFITS OF THE CRAFTY PASSIVE INCOME LIFESTYLE
When creating Crafty's Passive Income Lifestyle, I set out to design an income that was designed from the ground up to provide the following benefits: Freedom and Flexibility
Don't start a business that takes more work then a regular job demands, most businesses are just jobs YOU own.
Why you shouldn't work from the beach
I was scrolling through Google last week and was searching for my Passive Income competition - almost without fail, they all preach the Passive Income dream as Working From the Beach!
My friends, this is not the central image we need of flexible work. This is not what we should have in mind when it comes to location independence or getting more done. And this image certainly has nothing to do with balance.
Just because you can work from anywhere doesn't mean you should work from anywhere. My Passive Income goals include having the ability to work from anywhere in the world, including the beach - however, the beach is a terrible place to work from on a laptop.
Beaches were made for sand castles, seashells, and checking out the hotties in bikinis, not for you checking your reports from your laptop. Beaches are there for us to contemplate the immensity of our world and to get lost in the beauty of nature. No one wants to see you check stocks while you apply sunscreen.
Sand and laptops, not a good mix, sun-cream will mess up your screen, and lets not talk about over-heating - you'll half your laptop batteries life.
So please, get your work done and then come outside to play with us. We really don't want to crack your screen with our football.
If you're looking to create Passive Income, you've come to the right place
Become a Crafty Partner
Guess what? If that has been your goal, then I'm Indiana Jones, because I've found the Holy Grail of Incomes...I challenge you to join me, and together we'll increase our Passive Income streams.
Click the Join Me button, my contact page will open with the various contact options.
Pitch Your idea!
So, you've read the Passive Income Challenge, and now you have some ideas for creating your own passive income streams - Let's hear them!
Make Money Selling Merchandise
Why the heck did I include this?
Well, because I am OCDing all over the joint and want to make this list uber complete.
This passive income strategy may not be the finest, but it can be a quick and dirty way to quickly make some money.
Unless you have a super popular blog or a blog that speaks to the heart of reader’s identity, e.g a blog on Buddhism by a guru, e.g political satire blog, e.g an irreverent blog on old vintage cars etc, your readers are pretty much never going to say “Hey I want to walk around with your blog’s name plastered on my back”.
With all that said, there are other things you can put on merchandise apart from your name/logo; e.g quotes your niche would find inspiring or hilarious, graphic designs to do with your niche etc.
And hey, it ain’t too hard to whack up a design or two on Café Press, and just add that to your blog.
At least I’ll quit shooting this idea down then.
PS I’ve had a think about this idea more over lunch, and I think I may have failed to realise how many blogs fall into the “speaks to the heart” category.
I remember reading Corbett Barr of Think Traffic for example, saying how they made a couple hundred from selling posters of their Expert Enough manifesto. So I guess the circle is quite wide.
Heck even someone like Arseblog (a guy who writes about the English soccer team, Arsenal), makes a fair decent amount of passive income selling his humorously designed Arsenal t-shirts. Go for it!!
Make Money Interviewing People
Kind of like Mixergy, but for any niche!
You give away a ton of the content for free, and then charge for the premium stuff or for the latest stuff.
Either charge per download or offer unlimited access for a monthly recurring charge. You would probably be best off with a monthly charge for access to member’s only site. This wouldn’t be too hard to setup, especially if use Wishlist Member (membership software) + WordPress.
If you are interested in this idea I recommend you study the shit out of Mixergy and see how they do it – they have a cracking business model there.
Once again, I’m including this passive income idea…but only just.
It’s pretty active after all, if you plan to keep adding to it and expanding your customer base. But hey, 80% of the content is being created for you via your guests, so smile a little, this idea has some legs!
Make Money Creating An Online Education Site
This is going to make millions for those that get it right, but to be honest it’s not entirely passive.
The example that springs to mind with this idea, so I can really explain what I’m talking about here, is Corbett Barr’s Fizzle.
It’s an online member’s only site where there’s a library of content (video and resources), monthly webinars, daily Q&A, forums / mastermind group etc etc.
i.e it goes beyond a simple online course and replicates the learning experience of going to university where you have course books, lectures and tutorial classes.
It accordingly isn’t a cheap product, and instead demands a monthly ‘tuition’ fee if you like, of £30+.
The passivity in this product is probably about 70%. i.e you create the curriculum up front, and then add bits to it over time, often with the help of guest ‘lecturers’, but you still have to do a lot of work with your students / community.
It gets more passive for you personally if you take on some people to run the program day-to-day week-to-week, or you limit your interaction with the members / community.
But I’m going to be straight up here; if you plan to really kill it with this idea (ie £100k + a year), then like any authority site, this is going to require your full time attention.
Either way, the only way to setup this sort of online education site would be by creating a member’s only site. That’s a bit of work also.
Make Money Reviewing Products & Linking To Amazon
This is different to the ‘fake store’ idea, because here it’s not an online store we’re building, but rather a content-rich site with tons of product-focused articles and videos etc.
i.e one idea is for an online shop and the other for a blog/affiliate site of sorts.
So before we get into this, I want to say this is classic Chris Guthrie, the guy behind Up Fuel.
Chris is the guy who has earned £100k+ a year with Amazon affiliate fees…oh and I’m talking £100k profit, not turnover! Study these guys...
The important points per Guthrie are that you pick a physical product niche, then talk about specific products, so that people who arrive on your site are pre-qualified – i.e they’re doing research on a specific product and ready to buy if they get some confirmation that it’s a good idea.
All you want to do is get people to click your Amazon affiliate link.
Once they get to Amazon they may buy the product and/or other things (you get paid for them too – although your Amazon affiliate cookie expires within 24 hours of the person clicking), since Amazon is so good at converting people per their web page layouts, prices, suggested products and what not.
So scatter a ton of text based affiliate links throughout your article.
Your article can sum up all different products for a particular use, review them or whatever.
Just make sure it’s 100% unique writing and not copy-pasted product reviews/specs etc.
Some other points with this idea…
We don’t care about keeping people on our site, actually we want them to get going to Amazon, so make everything clickable, including affiliate coded product images, buy buttons etc.
The better quality your review, the higher chance the reader is ready to click – if you do hands on video reviews for example, you’re killing it!
Also, Guthrie says since it’s a product niche, you should try to build an email list by offering free buyers guides in exchange for sign up (you can email the list every time you do a new review for example).
One more cool tip, affiliate both high cost and low cost items, because by pumping up your volume (through low cost sales), you get the chance of earning higher payout ratios on the high end stuff later in the month!
Make sure you use different Amazon tracking IDs for different sites, so you can see which site is leading to the highest payouts.
Also show how products differ and publish best selling posts once a month.
Make Money Repackaging Existing Content
The average blog is like the average wardrobe…a complete fucking mess; with gold nuggets of wisdom spread throughout 100's of articles.
How much more useful would it be – to your reader – if you created a unified guide?
i.e collected all the best bits of your blog, ordered them and edited them down into a succinct punchy broth?!
If you can do this with blog posts, eBooks, podcasts, interviews or whatever, you can end up with an entirely new product to sell.
Since this idea could end up as an eBook, online course, video, or whatever, I thought it worth putting as a separate passive income stream idea.
PS need convincing? Then think about how many people buy eBooks that are simply ordered and succinct versions of existing blog posts!
PPS readers often write in and tell me 2 things are hard. 1) making sales pages for their eBooks without having to spend hours and ££ on a designer. and 2) making 3-D renderings of their eBooks for the sales page.
Solve these two common problems, and you've got an income stream in the making right there.
Make Money Outsourcing A Real Business
This is the craziest kind of passive income I can think of, because it basically involves executing Michael Gerber’s e-Myth idea 110%…
i.e so much so, that you are no longer involved in the daily running of the business.
But it isn’t that hard.
In fact, this is what your real entrepreneur does best; starts something up and then gets management in to run it.
But the twist I’m putting on this idea (so you can make the most money possible), is to think of a service business where the majority of the work can be done overseas.
Without this aspect, you can end up eroding your profits to a slightly sad 3-8% (hello your average small business!).
But what businesses fit within this realm?
A lot more than you think.
Anything that is done on elance for example fits perfectly; meaning programming (web design, SEO, etc), design (graphic, logos, branding etc), writing (copy-writing, editing, web content etc), marketing (PPC, business plans etc), admin (data entry, research, transcription etc), consulting (accounting, financial planning, budgeting etc), legal (contracts, incorporation, wills etc), engineering (CAD, product design etc).
If you can create a website, then market it via Google SEO – think content like articles and videos – and push all leads to an in-country part-time project manager, who then liaises with your outsource workers, boom, you’ve successfully executed!!
So why isn’t everyone doing this?
Well, it’s a helluva lot of work up front and you can make a lot of mistakes.
I know it took us about 6-9 months to successfully execute this ourselves and it requires a good eye for talent, systems and well, trust!
Most small business owners unfortunately can’t work themselves out of the business and delegate like this.
But anyways, let me finish this idea by saying it kicks ass, and for those of you who already have service oriented small businesses, then you may already have your passive income idea at your fingertips. Time to transform that puppy from painfully active to 90% passive!
To give you an idea of what I’ve done; well, I’ve applied it to a service business (web design) to great effect, along with my business partner, and let me just say I do max 1 hour work a day on this business thanks to systematisation, automation and outsourcing. Pretty cool right?!
The big thing about this stream idea is that you have a real business, i.e it generates £100k plus a year, and your ‘take home’ margins remain in the 50-70% range.
We’re no longer talking about selling £3k of eBooks a year.
And yet, we’re only needing to do a few hours a week of overview work; checking the numbers, skim reading emails, making a few phone calls and well, that’s about it.
I will say the big thing we’ve learnt with this idea is that if you really want to make it passive (i.e no more than 10 hours a week of work), you really need to pay well above the standard rate for your outsourced personnel. It really is that simple.
Be generous and you’ll say goodbye to headaches forever.
Make Money From Free Products With Donations
This is a popular passive income stream for lots of WordPress developers, especially of plugins, and is also quite popular amongst bloggers who pump out lots of useful content for free (e.g Steve Pavlina) – not to mention a great lead generator for future premium product sales.
The idea rests on your product adding a ton of value to users lives and you systematically and nicely / in a fun way, asking for donations.
The way you frame ‘the ask’ is crucial and the payment system behind it also needs to be dead simple…2 clicks and I’m done.
I would never rely on donations as an income stream, unless you plan on building a bid audience, of which 0.01% might want to donate you a few dollars to buy a beer.
Even a huuuugely popular WordPress plugin like Contact Form 7 appears to desperately be in need of donations just to maintain developer support.
Make Money Creating A Jobs Board
This ain’t going to be easy! But once again, think niches here.
The upfront work can involve a fair bit of programming, even if you do use a lot of template and existing off-the-shelf programs.
But it could lead to a sizeable stream of passive income going forward, assuming you build the site so that employers can easily upload positions and job hunters can easily find the site through Google searches (and then easily search through the job listings).
It’s an interesting idea for all the hard working hustlers out there with a bit of time and money to risk.
PS You can always go super low budget and create something rough and ready using an existing plugin on WordPress – that could be setup in a day or two.
But the real work comes in solving the chicken and the egg problem, ie how do you attract employers when there are no visitors yet, and how do you attract visitors if there aren’t many jobs being advertised?
My advice; first create a site that visitors would want to come to regardless (think helpful site for job searchers in that niche including sample resumes specific to those types of jobs, interviews with employers in that niche etc), then show employers the visitors you’re getting, and put the jobs up.
That’s how you solve le problem senori!
Make Money With An Online Community & Market Place
Think nichey here.
The idea is to get a bunch of people involved, creating content through forums and posts, and then sell them all kinds of products and services related to their interests.
Whether you sell products you make or others make or users make, it can be a big success.
Best of all, it is uber passive income, because the work up front is limited to website and marketing work, as opposed to also content creation – your users after all are creating all the content for you.
Obviously the problem with this idea is that you either reach critical mass or you die.
An example; the niche of knitting has the site Ravelry as the main community site and it is killing it by having a marketplace where community members can sell their patterns (designs) to each other and Ravelry takes a cut off everything.
Perfect, passive income in the truest sense of the word.
That said, there is really only one Ravelry in the knitting community (it got critical mass) and the people behind the site actually work quite hard because they don’t outsource any work, and well, once you have built up a community site it can become quite technically complex, so it may not turn out as passive as you hoped.
Make Money Designing Stuff
If you’ve got any design talent at all, this can be a very cool idea.
Sites like Cafepress make it super simple to submit designs, which means just like with the stock photography idea above, you can pump out a ton of designs in an afternoon and leave them up there waiting for people to buy.
The key to making money with this idea is to design stuff for niches you know, e.g computer geeks!
I’ve seen one designer who’s pumped out dozens of t-shirt designs that involve HTML and CSS jokes, and is killing it…relative to the amount of time invested in the initial design work.
And think about the number of niches that attract super excited followers; Crafter's anyone!
Oh and the crazy super niches…a friend of mine bought 12 chimp mugs from Cafepress recently.
Oh to be a monkey designer!
PS if you don’t have a lot of design talent, it’s still super easy to get started; e.g take 100's of photos in the real world, and then upload them across all different types of products from cups to T-shirts…you can stretch each monkey photo far!
PPS a big secret is to just go for volume, e.g 100 photos on 10 different products = 1000 products for sale…and that’s just one days work! Oh, in case it wasn’t clear, I would send say your 10-100 designs to a VA, along with the categories/products you want them uploaded for, because this is going to take hours of mindless uploading and configuring.
Make Money From A Niche Group Buying Site
This is gonna take some serious work, but can pay off big time.
It’s important to think outside the box with this one and realise that any niche can work well with this.
It pays to target niches where the target audience are ravenous consumers…i.e they want multiple products and thus want the group deals.
Two ways to structure the deal site…
You do one product a week or month, or you group a bunch of products together and do a bundled deal once or twice a year.
Think about what products are also open to deep discounts, e.g info products where the Cost of Goods Sold is basically 0-2% (thinking about payment gateway there).
How passive is this idea really?
Well, if you negotiate all the deals today and schedule them to drop on your site over the course of time – or just do it as one big bundle deal once a year – it’s pretty passive. Just a unique form of affiliate marketing really.
You will have to work hard on generating content to attract people and build the email list for your niche, but that upfront work is the case with every idea that can possibly bring in the big money. And hey, everyone whose product you feature (and thus cut in on the deal), will be motivated to mention the deal on their site too.
Make Money Investing In Real World Businesses
Hello silent partner investment!!
Oh no! There are so many horror stories of people investing in their mate’s pub or bar or whatever, that the idea sends shivers up my spine.
But if you do your due diligence well, then just like there are property investors, you can become a business investor (aka silent partner).
The most important part of executing on this idea is only investing in businesses where you get a cash flow (owner distributions) every year or otherwise on an ongoing basis.
Waiting around for a sale and subsequent cash out is too risky for most people.
Unless of course you want to be the next partner at Kleiner Perkins VC!
If you know contacts that have successful businesses and years of experience, but just need a little extra cash in order to expand or start something new (but similar to their existing operations) then you could be onto something.
I always think of the classic example of someone who owns a couple car washes, and now wants to setup an automated car wash in a good location – there you have the coin Laundromat (passive income) idea, but it’s now being executed by someone with experience and operational expertise.
Make Money Selling On eBay
How passive is this idea really?
Well, if you get someone to take care of the fulfilment side of things, pretty passive.
All you need to do is contract with someone in China via Ali Baba or the Canton fair itself, get it imported (maybe even straight to a full service warehouse) and then setup a shop on eBay (that last part can literally be done in 20 minutes).
It’s a very repeatable formula if you get it right.
The key to this income stream is your ability to choose the right product; one that’s not easily available locally or is way overpriced locally, doesn’t cost too much to post and you can make a 30% or more margin selling it on eBay at competitive prices.
The less traditional idea is to buy something in bulk in the UK at the low UK price (I’m talking about products that are only available in the UK) and then sell it on eBay internationally at super premium prices (including high foreign currency price).
For example, the Kindle Paper White…I think I paid a 45% premium on the UK price to an eBay seller. Good work on his part since he’s filling a need.
P.S. there is a much smarter way to make money selling products online…
…I am of course talking about selling your own white labeled products on Amazon. It’s 10x more passive due to Amazon marketplace + fulfillment. The full strategy for pulling this off is here.
Make Money From Rewards Programs
I kinda hate myself for including this as it’s not really going to net you much more than £1k a year in income so to speak, but hey, every pound counts.
So the idea is so brain dead simple.
Spend a couple hours working out the best reward and discount programs for everything you use; credit cards, flights, petrol etc.
It’s boring as anything, but it can save you (and make you) a fair amount of money over time.
And hey, just like any good passive income idea, after your initial upfront work (research), there’s little ongoing work to make sure these rewards and discounts accrue to you over the long term; usually it’s as simple as using one type of credit card, going to one type of petrol station etc. Simple.
Make Money Franchising An Online System
Now get the idea of creating the next Subway out of your head immediately.
I don’t want you to think so complex. I mean, Subway ain’t really all that passive, since the system requires so much support from head office; from food supply to leasehold to training, head office ain’t a passive place to be.
Think instead about simpler systems and in particular ones for online businesses.
Let me give you an example; say I create a successful online course for law students learning how to beat the LSAT (entrance exam).
In doing so I’ve created a system whether I know it or not.
A system for creating the course, the S.E.O marketing, the website, the payments system, the social media strategy etc etc, and it’s say 50% specific to this area (i.e entrance exams coaching).
I can then start selling ‘franchises’…albeit non-traditional style franchises for other people looking to profit from their relevant knowledge.
I get in touch with experts in other fields, e.g medical school entrance exams, business school entrance exams, prep school entrance exams, MENSA entrance exams, New York Bar entrance exams, psychometric exams for finance professionals etc etc.
I sell them the system in exchange for a 50% stake (and I could even get my team in the Philippines to set it all up for them, for an extra one off fee…kinda like how traditional franchises charge a setup / buy-in fee).
Now I just live off the revenue.
This is more than an online course or a simple traditional franchise sale, since you do have to work side-by-side with them to make sure they launch it properly and are able to maintain it. But once you’re done with that upfront work, you’re really done. Cue passive income stream for years to come!
Make Money Licensing Your Ideas
If you’re not super excited about risking a bunch of capital to create and sell a product, but you have ideas for products that fill real gaps in the market, you could become a freaking inventor.
This is a pretty nice passive way of earning recurring income over time.
A few things we have to be serious about though…
License fees for unknown unproven inventors are only going to be a couple percent at best.
Lots of ideas aren’t really worth anything (they need to be very specific so as to add value).
You need to become brilliant at networking and pitching (2 very difficult skills to master).
Oh and you need a feck load of luck.
But if you’re a technically minded person who always notices flaws in existing products, and you can punch up some diagrams and very specific literature on an idea (i.e so it does add value, and is worth something), and then even patent it, you could be on your way to a license fee driven lifestyle.
Make Money Organising Public Domain Information
In today’s world we don’t suffer from lack of information, we suffer from lack of accessible information…the kind that is organised and easy to use.
If you can organise an unwieldy body of knowledge into one tight, succinct set, you can charge for it like a Mofo. (I apologise for not setting a very good example with this comprehensive and structured article on all the different passive income streams around ;).
Now, I’m definitely not suggesting you go out and do the organising yourself, as this is low-level work you should outsource – it’s freaking data entry half the time.
To give a little more illustration to this idea let me give an example; say I’m a law student trying to get a job, what would be really helpful are the phone numbers of all the local law firms in my city (I mean all of them, not just the 7 that pop up in Google when you search for “law firm Solihull”).
So here you are thinking, hey I can get a VA to scour all the public records for this info, compile it and then organise it into a database.
Now we have something to sell to students from the local law school, or through Facebook, Google Ads or better yet, an S.E.O optimised blog.
If this works (or any other compilation idea), who says I can’t scale it and do it for lawyers in Birmingham, etc etc. I’ve just created an “Exclusive Networking Contact Database” for aspiring lawyers looking to land £100,000+ jobs.
There’s gold in them databases!
Make Money Buying An Online Business
It sounds too good to be true, right?
Just stump up a couple thousand and then you have a cash-generating machine in your hands.
Well, there is the risk that in 12 months the site has no Google traffic (usually because the site’s back-link profile was built in a mega dodgy way), the monetisation strategies you introduced didn’t take off, the site needs a lot more work than you hoped etc etc.
As with buying any business, you won’t necessarily have a golden-egg-laying goose in a year’s time.
But if you can shrewdly filter the 1000's of businesses for sale and obtain a great price on an auction site like Flippa, then buying your way into the passive income game can be quite a smart strategy indeed.
I know a lot of business experts always say it is much easier to adopt than give birth to a business so to speak. ie it’s much easier to keep a thing moving, than it is to get it moving in the first place.
To make this work you definitely need to learn the ins and outs of valuing an online business.
Since the risk is higher and no passive income stream is ever set in stone, don’t rush into it and don’t believe every word you read online – and hey, this person trying to sell to you wants money now…but if the site was really so good and pumping out the cash flow, why wouldn’t they want to keep it and take the cash flow year after year?