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As our clients grow their businesses, they tend to have less and less time available for smaller, one-off projects, or have to start turning folks away because heavily staffing up their businesses isn’t right for them. So, they turn to the idea of “passive income.” This typically takes the form of “infoproducts” such as courses, ebooks, workbooks, webinars—you get the picture.
Once the micro-industry of online coaching boomed and everyone started selling a “signature program,” the pressure to create this kind of “passive” infoproduct-style income has grown amongst a certain segment of entrepreneurs. But what most of these folks advocating for this sort of revenue stream don’t tell you is that while it looks passive, it’s a serious investment of time and often money.
Plus, providers of SaaS (software as a service) providers have another stake in this, because they provide turnkey solutions to delivering these types of products to your audience.
Basically, a whole lot of people have an interest in encouraging folks to pursue passive income. But most rarely go into the reality that this type of work is in no way actually “passive.” Here’s the reality:
– The free services will probably annoy you. We briefly used Thinkific‘s free tier for our Design in a Day™ content creation course and post-launch membership and it, well, sucked. We’re now on a paid tier with Thinkific and moving that stuff to Podia next month. (A couple years ago, I wrote about a bunch of these platforms over here.) Plan on $30-$50/month on that before you make a dime. Plus you may need equipment such as a quality microphone.
– Everything takes longer to create than you think. Writing an ebook? Even after you’ve written it, the editing and design elements will take awhile! Recording videos takes time, writing scripts takes time, it adds up!
– You may have to learn new things! This isn’t a bad thing, but you may not have time to learn video editing, title card design or course software. (I’m of the belief that even the “easiest” of software isn’t necessarily easy until you’ve had practice with it.) Plan for some frustration and maybe taking a course or hiring a consultant to walk you through things. (When I moved my email marketing to ConvertKit, the first thing I did was take a course—there’s no reason to struggle alone!)
– Your sales may, well, suck. This is fine but be prepared that making those first sales are hard, and don’t let it get you down. That also means not putting all your eggs in that infoproduct basket so to speak. If you’re hoping that that kind of “passive income” will lead to a laidback lifestyle, there may be easier things to pursue.
– You’re likely going to have to try a different style of marketing to a different audience. Many of our clients report that their product buyers and people who book them for one-to-one services don’t overlap all that much. Interesting, right? If you’ve never tried paid ads and never considered your sales funnel, well, you may very well find yourself diving right in!
Now am I saying these opportunities aren’t worth pursuing? Not in the least! What I’m saying is to keep your expectations reasonable, expect to seriously invest time on an ongoing basis—and probably a not-insignificant amount of money, and know that you may not nail it the first time. When I see people frustrated and unhappy is when they buy into the idea that they can make an easy income with their infoproducts. Go into it clear eyed, and you may just surprise yourself!