697: 10 Recurring Revenue Side Hustles

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But your day job isn't the only way to bring in consistent income, which is why today I want to share 10 realistic, recurring revenue sign hustles, starting with the one that's at the top of everyone's list, software. And while AI has certainly made creating your own software easier, one of our most popular recurring revenue episodes was with an entrepreneur who took an even simpler approach, simply white labeling someone else's software. That meant no startup or development costs, great margins, and just like SaaS, just like software as a service, monthly recurring revenue. For Chris Lalini in episode 494, he found this reputation management software he liked, the kind that helps small businesses collect more positive customer reviews. And then all he had to do was go out and sell it. We live in a very transactional world if you're a pro and interrogate. Most people aren't going to sign up for that. Nobody's going to raise their hand and be like, yeah, I'd love you to kind of sniff out my issues and my problems and show them to me and then use that to leverage into a sale of some sort. I think if you come in sort of adding value saying, hey, we've been talking with all these people in the industry and here's what we found out the main challenges and what our recommendation is X, Y, Z. Here's a quick little white paper of a couple of case studies that we've done that might be helpful for you. I think that begs the opportunity for a relationship or a conversation to start like you're saying. So, yeah, that's the way it is. Add value from the beginning. Now, giving that to software, you don't have to stay local to your geographic area. You could target customers all over the place. Is that something that you have found? Yeah, oh yeah. And that's really one of the beauties of software as a service, to be honest with you. You don't have a brick and mortar storefront where your catchment area is only within 50 square miles or something like that. People's willingness to travel. And I've got clients down in California and Texas and Florida and New Hampshire and Kansas. They're all over the country around. I don't know how many of the 50 states I have clients in. But a significant number. And in the power too is like with everything being so digital, right? And in these conferences being all over the place, I mean, I'll just give an example. I got a painter client of mine who's local here, but he attends a mastermind group where there's painters from New Jersey and it in there's painters from Texas in it, right? So that makes it referral to somebody in New Jersey, that painter in New Jersey knows an electrician who knows a plumber and it just sort of organically spreads that way. And that's really kind of the power of it, which is also, to be honest with you, why it's kind of exciting, you know, my wife and I have actually been kind of contemplating moving out of the Pacific Northwest. And now we've got two kids and you know, we've got a certain sense of freedom, right? Although I have a pretty significant and established network here, right? There's nothing stopping me from picking up and moving to a different state because most of the relationships I've built, most people haven't even seen me. To be honest with you, it's always fun when I meet them in a networking event. And I'm like, hey, you're actually a client of mine. They're like, really? And I'm like, yeah, do you recognize the voice? And they're like, oh my God, right? So anyways, that's always kind of fun too. Yeah, that's what you know, you can live the location independent lifestyle at this point. Yeah. Exactly. Are you comfortable giving a sense of the size of the business today in terms of revenue on a monthly basis if that's how you track it? It's multiple six figures and the profit margins are extremely healthy. And so, you know, the good majority of that goes right into my pocket, right? And we have, we've been growing every single year. Well, with the exception of 2020, where we were, you know, like, 0.9% down, right? But compared to most businesses, that was a pretty awesome year. So. Yeah, if you can walk away from 2020, essentially. I'm flat. Like, we'll call that a win. Exactly. Okay. So. But, but like, for instance, you know, last year we grew our MRR monthly recurring revenue by 50%. My goal is to build, to grow it another 50%. Because kids are expensive. I don't know if anybody told you that. But. And everybody talks about saving for college. It's like, no, you get to save for like daycare and preschool. So you mentioned MRR is that among the metrics that you pay in most attention to, I guess, you turn would probably be part of that. But what do you look for in the kind of a dashboard reporting? Yeah. Monthly recurring revenue is really the key. The turn, it just, it really isn't there. I mean, I will lose a couple of customers, you know, some months I don't lose any customers, right? But, you know, it can be as much as like two, three in a month, which is not significant, right? For me, and so I'm just constantly always kind of replacing them with, you know, with at least that and then plus some, right? So, yeah, that's mainly the metrics that I, you know, follow. Again, that was Chris Lilini from episode 494. And it was funny. We've done a bunch of episodes on white labeling physical products for e-commerce, for Amazon, but never digital ones. And so that episode got a lot of attention because he was able to buy seats or licenses to this software and essentially wholesale prices and then resell it at retail, making that margin in the middle and providing a layer of support and consultation for customers. Now, like we've said on the show before, if you want recurring revenue, you got to solve a recurring problem. And the next side hustle is a great example of that. This is from my chat with Erica Kruppin from Kruppin's Pupin Scoopin. Yes, it's a pet waste removal business in episode 614. One of the common themes on the show, hey, you want recurring revenue, got to solve a recurring problem. This definitely checks that box, right? As long as that dog is in that house, they're going to have this problem. And so I imagine the customer base tends to be pretty sticky. And if you start to canvas the neighborhood with these yard signs, people learn the brand and the reputation and they know who to call when they have this issue. But I remember, I think we were talking about maybe 15 bucks a week, 15 to 18 bucks a week early on. And it sounds like pricing has grown or pricing has increased a little bit since then. Tell me about that process or you just play the inflation card, hey, look, costs are up everywhere. You know, we got to do a two sorry for the inconvenience. What happens there? So when I talk to you back in what was it, 2020, I think I was only charging $55 a month, which boiled down to like 1375 a week. And that was just enough to pay me. And I had my little cobalt with my magnets, but quickly learned that I needed to raise my prices. So gradually I started to raise and how I did that was when I was getting new customers, they would get the new rates because I was still kind of scared to raise my old customers like my original 12. Okay. But as I started collecting data as I started researching vehicles, new branding, I quickly realized that I needed to up my prices. And it was scary. It really was, but I've raised my price several times. Now I'm at like $99 a month about that's the average ticket price for the customer. The last time I did the rate increase, I just sent out a letter and just said, hey, I got to raise my prices. This is what it is. This is what's going on. This is what's to be expected. And this is how it's going to roll out. So I'm very like detailed with my letters. And if they have any questions or concerns, I have the conversation with them and just explain that I needed to raise my prices for X, Y and Z. And if they wanted to cancel service, I completely understood. And some did. Some did. But because I was able to bring on thousands more a month, it balanced out. It was okay. So number two on our list is what I'm calling a local subscription service side hustle and cleaning businesses like Erica's are perfect example of this because stuff just keeps getting dirty. It could be a weekly pet waste cleanup business like Erica's. It could be a daily commercial cleaning service. We've even seen guests getting paid to sweep up a litter from parking lots as a recurring service. House cleaning examples where the business owner contracted with other cleaners to fulfill the work and built a little house cleaning agency. The other example of a local subscription service we had recently was chef Jessica's personal chef service where she said a typical rate might be 500 bucks a week per client with clients tending to stick around for a long time after they get used to this luxury service in their house. And a line in our episode about a client referring to her as like the furniture, meaning she wasn't going anywhere. She was part of the house. And just because you sold a subscription service doesn't mean you necessarily need to be the one doing the actual work all the time because I get that push back as well. Hey, it sounds like I just signed myself up for another job. But in that episode with Erica, she talked about bringing on other team members to help with the actual scooping so she could focus on marketing and operations. So that's number two, the local subscription service. And next on my list is a similar strategy, but taking it online. The example here is Eric Dingler's digital marketing agency where his local SEO services can be $500 a month or more. But we've seen productized service offerings and everything from content writing to graphic design to video editing and probably others that are escaping my memory right now. But recurring revenue comes from solving that recurring problem. In Eric's case, the Google ranking engine is constantly changing, constantly evolving. So clients outsource that work to his team so they can stay on top of it and the business owner doesn't have to worry about it. But for our monthly recurring, where we go and we say, "Hey, listen, we can manage this for you and we can write content. We need to have a strategy session once a quarter where I come in and I interview you about your, how long have they been here? How long have they been? Like, this is where you get into the nitty-gritty. And we do a quarterly strategy session and we, you got any specials coming up next three months? Anything you want to put, like you have a seasonality to your business in the next three months? Is there work something like, "Oh, back to school is big for us." Valentine's Day is big. Okay, great. So then you create that content calendar and at this point you'll get a tool where like, now you're going to create the content and post it so it's automated and done for three months, things like that. Or better yet, how I do it is I now have a team that does this. I've got an amazing person on my team from El Salvador. She's a rock star and this is all she does for us. She only does local SEO content. She creates it. She meets with the clients once a quarter, does a strategy session, maps out their content. She can do two of these a day and we typically charge around $750 a month for the ongoing monthly recurring revenue. But again, I grew into that. So this is local SEO. It's not going away. But that's no. That's like really, really cool to see what is potentially possible down the road with a trained up team member who is taking half a day to service this customer that you're charging $750 a month for. You imagine the margins on that are quite healthy. Yes. Even if you hire somebody in the States, I have one person on my team in the States, but the rest of my team are remote. We're an entire remote, I'm remote. Yeah, yeah, yeah. So my team is remote. Yeah. And we just, that's how we operate because we are able to keep in very high margins. We're going to keep our costs very competitive that way. And it's fun to be able to travel around the world and meet your staff. Do you worry, you know, this is the, the Bayzo's line of, you know, your margin is my opportunity. DC clients getting poached from under you from other competing services. It was just like the number of small businesses is so vast, so massive. That's like, well, even if we lose a client, that's fine. We'll go find somebody else. It's like, it's, we try to play this game of churn versus retention and margins versus like, well, wait a minute. How much does this really cost to fulfill? Yeah. If you show up every month with a report that's showing results, hey, we got you these results. That's you, most business owners, that's the number one complaint I get when we get a new customer. We were spending all this money. I never knew if it was working. Got it. You know, I didn't know where the results were because in the agency world, we're known for just sendin a report and expecting our clients to read it. They don't have time for that. We show up proactively. Hey, we just looked, you're at the, and we just tell people, we might call a client and say, hey, we just ran your report and, you know, on average, we've dropped three positions and we use that. We use we, not you, not, you know, it's, it's, we're in this together. Hey, we dropped three points. And so we looked and here's what we'd like to do. We'd like to do this and this and this over the next six weeks. And they're just like, hey man, you've got our back, whatever you need to do, like, because it just, you build trust, you build trust. And for us then, now this led to then the, I had no intentions to own an agency. I was pastoring a church in my wife and I decided to adopt a sibling group from Bulgaria. We had two biological children and we just felt like the next thing we were being called to do was adopt. And I had to come up with an extra $50,000 because we wanted to adopt debt free. Okay. I didn't know how I was going to come up with $50,000. So I had to come up with a side hustle. And I knew how to build websites. And so I started building websites and that kind of got a little bit of traction and I got a couple of dozen clients. And then I learned about this local SEO. And I just went back and I upsold my very first client to do it. I was like, hey, I'm testing this thing and you know, do that. And they're like, yeah, okay, sure. And I was like, it's $13,000. And they're like, yeah, sure, let's do it. I'm like, great. And then I went to some businesses I didn't even know. I did the same thing. And I did that. And then I started, and then I worked through my network, my local business network, onboarded all the low hanging fruit. And then we started to learn how to do another service. And so I just went back through and I said, hey, we're now doing reviews. As a certain, we can help you get more five star reviews from your satisfied customers. Oh, yeah, Eric, let's do that. Again, that's Eric Dingler from episode six, eighty four, just a couple of months ago, high value recurring service. Eric also touched on something crucial, showing up proactively with results in the agency world. That's what is separating the long term winners from the churn and burn operators. I've got more recurring revenue side hustles coming up right after this. Scrappy side hustlers have an advantage over bigger competitors and that's speed. The faster you can pick up the phone, the faster you can respond to customer messages, the better. That's why today's episode is brought to you by Quo spelled Q-U-O. This is the business communication system built so you never miss a call. Quo is the number one rated business phone system on G2 with over 3,000 reviews. It's built for how modern teams work. In fact, more than 90,000 businesses from side hustlers and solo operators to growing teams already rely on, quote, to stay connected and stay on top of everything. 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We're talking through 10 recurring revenue side hustles in this episode and so far we've covered white labeling software or software as a service if you're so inclined, maybe do the vibe coding thing, a local subscription service through the lens of Erica Kruppin's Pooper scooper business in an online subscription service as through the lens of Eric Tingler's local SEO service. But next up is by the numbers one of the most popular side hustles in the world and that's rental property investing. One property can pay you month after month, year after year and you can slowly build this cash flow and long term wealth. But where it really becomes a ticket to early financial independence is when you start to stack the cash flow from multiple properties. Here's Dustin Heiner from episode 691. So I started investing back in 2006, bought my first property. It made me money in cash flow every single month. I said great, I got to get 10 of those. So if I make it $300 a month with one property, then that's $3,000 a month with 10 properties. That's great. Just like if you find a good side hustle, you just replicate that same thing over and over again. So fast forward now to where we're at now. I have over 30 properties that are making me money. I still own the ones that have bought back in 2006. First property is always the hardest because you got to prove it to yourself that it works. You got to get the money. You have to get built. The business, all that sort of stuff, coach, I don't know, maybe at over a thousand students now, how to invest in real estate. Like clockwork, they get their first property and we can go into the entire business building process to where it can scale where you can get to 10 properties in 10 years. I think honestly even faster because you do all the work on the front end just like building a side hustle. The second property comes so much faster because all that work is paying off in the future. So my daughter, she's 16 years old, just bought her first property three months ago. It's make it $300 a month and this is the plan that I have for her by one property. Get that passive income coming in every single month, $300. Do not spend it. Do not go out and buy this or buy that or whatever. That's maybe the disciplined part of this. I got some of the sketch flow and I'm going to parlay that into the next thing. Absolutely. And so every year we focus on buying at least one more property. And then Over 10 years, if you do that, 10 years you have 10 properties and hopefully each one. or make you three, four, $500 a month, or more in passive income. Now, I like Dustin's call to focus on cash flow from day one, not appreciation. And to put the key players in place before you ever buy that first property. In his case, that's property management, contractors, handy persons, realtors, mortgage brokers. Fun fact, real estate was actually one of my first side hustles where I followed pretty much none of Dustin's advice and had only $100 a month. Cash flow cushion on that property was banking almost entirely on appreciation. And it ended up working out, but definitely one of those cases where it's better to be lucky than good. But that's real estate, recurring revenue side hustle number four on this list. And maybe we can broaden that even to include other rental businesses, like we've done episodes on mobility scooters and photo booths and portable hot tubs even. Now, similar idea, right? Get paid over and over again from the thing you buy once. And in a lot of cases, the return on investment math is going to be a lot higher for those quote-unquote unconventional rental assets. But there's usually just more labor and turnover involved. Nobody's signing a 12 month lease on a photo booth, for example. But sometimes the path to recurring revenue starts with recognizing what you're already good at. For example, Liz Wilcox was doing client work in email marketing, professional copywriter. And she had this realization, instead of starting over every month, trying to find that next project, that next client, what if she could create something that people would pay for month after month? That's number five on our list, a membership program. These typically range from $5 to $100 a month, or sometimes even more, depending on what you're offering behind the paywall. Here's Liz breaking down her mindset shift. And why she chose low cost, just a $9 a month membership, over something higher ticket. So I sat down and I did a little bit of math of to Nick's point of, I don't want to have to start over and over every single month. So what kind of membership can I create? And how many people do I need in it to get me to that day rate? Like if I could just book myself with the membership sales one day a week, or one day a month, one day a week, the whole calendar, right, like future pacing myself. And I got really excited. I said, you know, I could do a low cost thing because I've got time. I've got this $20,000. I know I can do client work. And I know I could probably do it for a couple more years. I'm going to go low cost because again, that's low responsibility. I have a bunch of responsibility in my home life. I have a bunch of responsibility with my clients. What if I could create for my email list like this really low responsibility thing and just slowly build it up? And I said, okay, if I can get a hundred members at $9, it's $900 a month. That's nearly half a day of my day rate. That sounds doable. So I did it in like a bite size chunk. That sounds doable. And then within two years, if I could get a thousand people in at $9, that would be $9,000 a month. Recurring revenue, the way it blew my mind. Unlike you, maybe you're listening and you have a nine to five, y'all, I've never had a job before. Like my last job was at a gas station when I was like 20 years old. And so I've always like Nick said every month, I'm always starting over. And I've been doing that my whole life. Yeah, like the mental toll that I could take is yeah, I could be stressful. It's so stressful. And so I said, I could do a couple more years of this low cost thing, this low responsibility thing. And after a couple years, if I could just remove the client work, I know in two years I'm going to come up with other ideas, other courses, workshops, whatever. But if I could, when two years remove client work, wow. So I was really willing to be patient. I didn't need the money right then, but I was willing to be patient and wait two years for the payoff. And guess what? It definitely paid off. Sounds like it's working. Just fine. I want to hit on this low cost equals low responsibility. Because I think that's an interesting distinction. And we're getting to the numbers behind that. Because I got to sell 100 members at $9. First of all, where am I going to find 100 people to pay me? It's like, you know, going from zero to $1, I think is more difficult than going from $1 to $100. It's like, well, if I charged $100, I'd only need 10 members to get to a thousand bucks. It seems almost harder, even though it's like low ticket. It seems almost harder to go out and find that many people and convince them to pull out their credit cards. I love that Nick just said this because it just shows you like you should create something that makes sense for your brain because I wholly disagree with what Nick is saying. And not in a negative way, but like to me, I can get just about anybody to give me $9. I disagree with Nick. I think it's actually pretty simple to go out and find 100 people. For my personality, it's actually pretty easy for me to be out and to sell people. And I knew that about Liz Wilcox. I knew that I was already building this email list on the side. That was my side hustle to the client work. So what do people get for the $9? What's behind the paywall? I knew the missing piece for people is a weekly newsletter. Just following up with their subscribers every week. That's something you're a side hustler. You're just working a few hours a night on this project like sending an email is that really what you need to be doing with your time. So I knew if I could just write that newsletter for you, maybe you'd give it a shot and you would see results like mine. So within the membership, you just get a weekly newsletter template to take and make your own. That was lower responsibility for me because then my client work, that's what I was already doing. I was writing emails for people. I had owned two businesses prior, writing emails to people. I had an entire catalog of emails that I had been writing for years and years and years. I can just have this one deliverable of this thing. I already have a back catalog of that I can templatize and I can send out once a week. Yeah, I can commit to that for the payoff in two years. I'm going to be able to retire client work over here. Okay, yeah, Liz, let's try it out. That clip was from episode 600. If you want to go check out that full interview with Liz, cool example, I think of selling your sawdust. Like what is a byproduct of the work you're already doing? Could you repackage and sell that to a different audience? But when it comes to memberships, there are different ways to structure it, depending on what your ideal member is going to value. The comment saying in the online business world, "People come for the content, but stay for the community." So maybe you add some level of member interaction through a Facebook group, private forum, discord community. And a membership could be for a product or a service. You probably subscribe to both in your own life. I'm thinking of Netflix, Costco, the Yoga Studio, Dollar Shave Club, KiwiCo, Life Insurance, all kinds of examples of businesses under this recurring revenue membership umbrella. Paid newsletters could be another example in the online business space. We've heard from entrepreneurs gating a certain members-only content through a service like Patreon. Oh, and we had one interesting example was the survival podcast. Jack called it the member support brigade. I think it was basically an annual discount club that he put together for his listeners. Like, hey, you're probably going to want these products anyway. So I went out and negotiated a special deal for you and you can get access to all of those deals for an annual membership fee. So when we spoke, I don't think there was a community element to that offer at all, or listeners could interact with each other. It was just structured as a discount club. So I have a long, contemplated putting together some kind of membership offer for a side-ass elimination, but it's a case of analysis paralysis. Not sure the best way to make it really compelling and valuable for you. I'm open to ideas. Send me a note. Let me know what you think about that. But memberships are number five on our list of 10 recurring revenue side hustles. Lots of examples of those in the archives if you want to dive deeper on that topic. Number six is websites, which used to be fairly straightforward. Build up a body of informational content in a given niche, rank that site in Google, and then earn relatively predictable, relatively passive income from advertising and affiliate relationships. Those types of informational content sites have been having a hard time lately. This includes side-ass elimination. My earnings from just straight up SEO have taken a huge hit, but websites can still be a recurring revenue asset. One model that we've seen to be a little more AI-resistant is directory websites, which might sound kind of old-school, but in our recent episode with Freightew, he proves there's still good money to be made with directories. The key is finding underserved niches and then building something genuinely useful with some value added data. Because after all, if people can get everything they need from Google Maps, there's no real reason to come to your directory. So the value add, you're going to have some extra layer of data that you're providing that Google is not. But here's Freight from episode 692 on the money milestone for his first directory, which was in the thrifting niche. Six months in, I randomly just poured up the Google Analytics and noticed there were a thousand people coming to that website that day. And I just remember staring at it for five minutes and being like, "What is going on? Like, where is this traffic coming from?" Yes, it's real. Yeah. At that time, I was like kind of a new bit SEO too. I was relearned or just learning all the basics. So I was thinking, "Oh, maybe I did something correct." And I started putting ads that following month and the traffic kind of steadily came in, and I made $1200 that month without really. doing anything. It was just putting up ads. - Was this just a ad sense? - Yeah, I actually end up using a Zoic. That was the media partner that I used and now I'm using a Mediavine Grow, which is kind of my go-to ad partner now. - Okay, so you built the thing and then kind of sad on it. I guess let it age potentially in the search results and establish some domain. - Oh, you mean, proactively to market it during those six months? Or just like log in one day, "Hey, it actually is getting traffic." I did post on Reddit and I talk about that a lot. Every time I finish an entire direct rebuild, I always find a niche subreddit and I'll make a post. It'll basically sound like, "Hey, I made a website to make XYZ easier or to find XYZ locations easier." And yeah, that's kind of the only thing that I did. It was responsible for maybe like a few hundred people come into the website because that Reddit post performed really well and people still commented to it on this day, a couple of years later. But yeah, really nothing much, nothing too fancy was done. All right, well maybe we can pull it back and say, "What attracted you to this business model?" - I think every entrepreneur goes through this moment where they either struggle to start something or start something and realize that's not the thing that they want. So in my case, I was running a full-wear business, I was closing it down, super depressed, very low point of my entrepreneurial life. And I realized what I really wanted was a business with five things and it was something that was scalable. Something cheap to start, something remote where I didn't have to like go to a warehouse and pack shoes and ship it to customers, something with high margin and something that could be sold as an asset. And I scoured the internet for these businesses. - Very difficult to find. I found two. - Yeah, this is a little bit of a unicorn like with something that checks all those boxes. - Totally. So I found, I think I landed on SaaS or websites and I'm not a coder. So, you know, and this was kind of pre, like, this early AI, a tragedy we could regret. - Yeah, pre-AI, vibe coding stuff. - Exactly, yeah. The vibe coding was not a thing yet. So I landed on websites and I saw exactly what you mentioned, which is niche informational blogs. We're getting absolutely destroyed, especially starting September 2023 with the helpful content updates. So I was like, okay, well, I guess I'll just look on HREFs and see what wasn't affected. And I started noticing these directly. I didn't really like go into it, thinking I'm gonna go build a portfolio of directories. I was just like, okay, well, this, I found this website that was getting over 100,000 monthly visitors and it was rank one, page one for my target thrifting keyword. And I was like, I could do better than this. This is like pretty ugly. And I feel like not that helpful. There could be better information. It's also out of date. They're missing a lot of locations. And I was like, okay, I'm gonna go and build it. And yeah, once I started ramping up and that kind of aha moment happened, I was like, okay, this meets all those five criteria. And I can just keep building these out. That's what launched the directory side hustle for me. Again, that's Frey Chiu from episode six and 92. Highly recommend checking that one out. If you've been impacted by the last couple years of SEO upheaval as a way to potentially fight back and start making money online again. And I love the five criteria. He mentioned scalable, global, cheap to start, remote, friendly, high margins, sellable as an asset. That's a pretty solid framework for evaluating any business opportunity. In fact, the episodes featuring side hustles that check those boxes tend to perform pretty well. So maybe a directory will be my next side hustle. There are unfortunately more ideas than there are hours in the day. But don't sleep on websites as a recurring revenue opportunity, traditional article-based Q&A SEO. Tough right now. But certain types of websites are still getting traffic, traction and revenue. And that is recurring revenue side hustle. Number six. I've got more recurring revenue side hustles coming up or right after this. When I find myself procrastinating, it's almost never about to work itself. It's about the decision fatigue surrounding the work, like how to reply to this message, or is this person going to make a good guest? Is this the right tool for the job? But if you want to sell products online, let me take some of that decision fatigue off your plate. There's a reason millions of businesses, including dozens of side hustle show guests, to choose our partner Shopify. Think of it as this one decision that makes all future decisions easier. For example, you no longer have to start from scratch and designing your storefront. You can just pick from one of the proven templates and then customize it to match your style. You can quickly generate product descriptions. You can use Shopify's built-in AI to enhance your product photography. You can even fire up email and social media campaigns to help drive traffic and sales. Start your business today with the industry's best business partner Shopify. And start hearing, sign up your $1 per month trial today at Shopify.com/sidehustle. Go to Shopify.com/sidehustle. That's Shopify.com/sidehustle. One customer says, "This tool literally spoiled me." It's so easy. 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That's three months of free payroll at gusto.com/sidehustle. One more time, it's gusto.gus.to.gusto.com/sidehustle. Number seven is a side hustle that probably doesn't get enough air time. And that's product licensing. This is where you can turn your ideas into recurring revenue and get paid every time a major company sells your product idea. And you didn't even have to worry about manufacturing it. Steven Key from Invent Right has made a career out of renting his ideas to companies that already have the distribution and manufacturing and marketing power to bring them to market. Here's Steven explaining why licensing can be faster and less risky than starting your own product company. It doesn't require any capital. You don't have to set up a company. And there's so many companies out there that need us to create a people. So they're looking for ideas. And every year there's just more and more opportunity for us to submit ideas to companies and let them pay us royalties for everyone they sell. So that's the basic business model is saying, hey, I am the idea guy who we just had on the show. And I'm going to turn around and essentially sell that intellectual property to some company who can turn that into a product and make money off it. - Absolutely. You're basically renting your idea to a company. - Okay. - And they're going to pay you when everyone they sell. So you don't have to start a company. You don't have to worry about manufacturing or raising money or do any of those things. And what's really great about it, Nick, it's really speed to market today, right? If you start a company, race capital, all those types of things that you need to do to be successful, it takes a lot of time and effort. When you license an idea, you find that perfect partner that has relationships, distribution, money, they can put your product on a shelf extremely, extremely quick. - Stephen went on to explain that 5% of gross sales is a pretty typical product licensing agreement, which may not seem like a lot, but if you think about the distribution and economies of scale that some of these larger brands have, it can really add up, especially for something with super low startup costs. I mean, you're basically taking something for free out of your brain and getting paid for it. And Stephen had some great tips on how to approach companies with your ideas, how to find the decision makers. But one thing that was surprising to me is that a lot of companies already have a process for this. They're really open to crowdsourcing product ideas from people like you and me and paying us for them. For example, if you look up Hasbro Submit Ideas, you're gonna find this structured program called Hasbro Spark that lays out how it all works, how to submit your proposal and stuff like that. So be sure to check out that full episode with Stephen for more on how it all works, which I will link up in the show notes. So product licensing is recurring revenue side hustle number seven. Number eight is web design and hosting. And before you say, well, I don't know how to host or design websites, let me offer a gentle reminder that everything is learnable. And after you hear the next clip, you might be more inclined to learn it. In episode five, 50, Ryan Golgowski discovered something really interesting. Instead of selling websites for thousands of dollars up front, what if he charged a few hundred dollars per month for ongoing design, hosting and maintenance? This model makes websites a lot more accessible to small businesses while creating predictable monthly revenue. Here's Ryan explaining how he makes this value proposition work. - If having a better website that is gonna offer a better user experience, it's gonna better your SEO, there's gonna be better conversion optimization on the site, even if it's just generating for you one extra sale a month, that's extremely conservative way to look at it. The service is already being paid for and then some. So it's a pretty simple, easy sell, whereas if I were to try to sell a website for five grand, a lot of people sell websites for even more than that 10 grand, for a company that's, not doing millions of dollars in sales, that's like a huge number to them. And it's hard for them to justify, but 180, 220, 300 bucks a month, and they're not only gonna get more leads, they're also gonna look a lot better. So there's gonna be so much more perceived value to their marketplace. They're gonna be perceived as the high-end, luxury, most professional service provider. - And you're doing several of these a week at this point. Sounds like volume wise. - Yes, yeah. So at 20 a month, give or take, sometimes less, but last year we did 211 new signups, and this year shooting for 250. - Yeah, listeners can do the math on that and say, wow, that's pretty substantial operation. And now, once it's in on the developers desk, what's their typical turnaround time to get this thing up for approval or up for hosting? - Yeah, so the initial stage of development, it should have about a week's time max, they could get it done quicker than that. Then it will go to the project manager, they'll be going back and forth with the client if they need any revisions, that will go back to the developer. And then if we're doing content, that will take a little bit of extra time for us. If they're doing content, it could be fast, it could take a year, who knows? But we shoot for about a four week time frame for the project from the timely signup to the time their site goes live. - Okay, just to give yourself some buffer room in case there's any back and forth. Okay, cool. And do you consider the upfront developer time and some of these other upfront costs? Is there a sense of the break even point? Well, after three months, we're good. Or after six months, it's all gravy. And so if we can keep that person on for six months, I keep them happy. I mean, they signed the contract, but who knows? I just try to get a figure out for like, yeah, you're front and some labor and some other expenses up front here. - Yeah, yeah. I mean, it definitely starting out, it is not as efficient or profitable, but over time, you'll really refine your systems and you should be able to, at least your fixed costs should be covered by about two months of the customer's payments. Fixed costs covered by two months of customer payments, meaning the next 22 months are almost pure profit. Again, that is episode five, 50 in your archives. Definitely one that I refer back to quite a bit and likely replicable in a ton of different niches. Remember, Ryan was focusing on power washing companies. This is primary client base. Now, the key is that monthly support or that monthly payment includes ongoing value hosting maintenance updates and support. Our next recurring revenue example is what I'm calling subscription e-commerce. Think Amazon, subscribe and save. Think subscription boxes. Think replenishable products in the direct. The consumer space element comes to mind. There's little salt packets when to use them up. You're probably gonna order more dollar shave club for razors, supplements and vitamins. After all, it's easier to sell the same thing to the same customer again, than it is to sell a brand new thing to a brand new customer. So we had a couple guys on the show last year, before, and their product was a replenishable product in the skincare space called Pretty Boy. Skincare for men, yoprettyboy.com, I think was the site. But between the initial inventory and the marketing expenses, it can be a pretty capital intensive business. Ben Fays and his partner, Kevin, found success by focusing on one key metric, making sure customer lifetime value exceeded the cost of acquiring that customer. Here's Ben from episode 581. Is there a metric you like to be at in terms of cost of acquisition? From a profitability and break even point, we wanna be in the mid 20s because of our LTV, which hovers in the $70 to $80 range, and because of how frequent people transition to subscribers and then how long those subscribers stay. For us, I mean, Nick, I'm sure you're familiar with Andrew Ferris. I don't know that name. Okay. He's a big e-com guy, does a podcast. He talks a lot to brands like ours at his podcast. We're his target audience. We listen to this podcast that we found so interesting, which he's like, if you start to see that you repeat customer rate is basically exceeding your new customer rate. So if returning customer revenue is outpacing new customer revenue for sustained months, what that tells you is that you should be basically doing everything you can to throw a boatload of cash at getting new customers. So now that CAC metric for us hovers more in that 35 to the low 40s range because we know again, with that LTV that that customer, we are willing to bet heavily that if you buy our product once, you will at least buy one more. And we think of vast majority are going to subscribe about 60% of our revenue on a given month, comes from subscribers. Okay. You have the subscribe option versus-- Yeah. Okay. Which again, meet the customer where they want to be. Like Shopify would just let you do that. Like make it a recurring purchase. There's tons of apps on Shopify. It's one of the most user friendly platforms you can have. We use a service that specializes in subscriptions and some of the things like why I was saying meet the customer in the middle that they do so well is our subscription model allows you to pick your frequency. 30, 45 days or 60 days. You can sign up to manage everything via text. So you can skip an order. You can cancel it any time. We're not holding you to anything. You can pause your subscription for one, two, or three months. We're going to make it as easy as possible for them to do business with us as long as they like the product and the brand. Again, that's been phased from episode 581 from Yo Pretty Boy that common his recurring revenue side hustle in the skincare space under this category of subscription e-commerce. And one thing to keep in mind is the timing of cash flows. It can look great on paper. Hey, a customer is worth $100 over their lifetime. We can buy ads. We can acquire those customers for $50. No brainer. Let's do it all day. Except Google and Meta want to get paid today, or at least whenever your credit card comes to do at the end of the month. And that $100 LTV might not hit your account for several months or a year or maybe more. But it definitely makes you think about what kind of replenishable products you buy on a regular basis. Coffee, toilet paper, protein powder, greens powder, like a bloom or a EG1 shampoo, deodorant. Lots of examples in those spaces, but maybe some side hustle opportunity as well to come in with some unique positioning and make a name for yourself. Even Mark Rober and his Crunch Labs build box would qualify, right? But I think there's a higher degree of difficulty because me, his team in that case is having to recreate the product every month. It's coming up with something new. Something you don't have to do if it's just shipping out a new set of razors or another tube of skin cream. But subscription, e-com is recurring revenue, side hustle number nine. Our final example takes a traditional high touch service and makes it surprisingly scalable. And that's coaching and masterminds. So coaching and masterminds typically require a lot of personal time and attention. And because of that, they're usually higher ticket, like $100 a month or more. But in episode 570, Stephen Faust found a clever way to scale personal mentoring using technology. So instead of traditional group calls, which he found he didn't love doing, he offers unlimited one on one mentoring through an asynchronous video platform. Here's how he makes it work in the military career niche. - What's better than just selling stuff one off is getting people to pay you every month. And I leaned into that and my membership includes a lot of the stuff I sell one off, which is kind of maybe a faux pas in some ways. But my digital products that I sell are inside the membership, right? Because what I realize is not everybody wants a membership, right? Sometimes they want to buy stuff. And sometimes they just want to get more help and support in the membership. So I have all of the things that I sell one off inside the membership. Plus I have some additional things, some additional workshops. I'll usually add a new workshop once a month, a topic, a leadership topic. I also do, and this is maybe a little unorthodox, I stop doing member calls because mainly I didn't like doing them. I didn't like having to be to show up. I'm more of a passive income guy, which doesn't really fit memberships, but that's kind of what I desire. So I stop doing member calls because I didn't like them and people didn't really attend them that regularly. So what I do now is I do and I sell it this way, including in the membership is unlimited, one on one mentoring, unlimited mentoring for $39 a month, plus all the stuff that they get in there as well. So that's the stickiness of my membership is the once a month workshop and the unlimited one on one mentorship. - How do you deliver that? - Exactly. Great question. Great question. And I know you're familiar with this. I'm sure video ask. - I don't know video ask. Okay video ask. It's a great tool. It's kind of like a bond Euro on steroids or a bomb bomb on steroids. So video ask.com, I use that. And what that does is it creates an asynchronous funnel that I have in my membership where it has a video of me giving an instruction going, "Hey, if you have any questions, you need help or support. If your boss won't help you, I'm here for you. I got all this experience. Let me help. Ask me anything you want." So they click a button. They can leave a video, they can leave an audio, or they can leave a text. They can choose their own adventure on how they want to communicate with me. They hit the button. It goes into the funnel. Video asks, sends me a notification that says, "Hey, Suzy left you a message in this funnel, this mentoring funnel that's for my members. I go in on my phone and I click a button and then I will watch, listen, or read what she says. And I push, I've done this in traffic at a light. I've done it at the supermarket. I just push a button." So hey, Suzy, great question. Here's what I would do. Step one, two, three. [BLANK_AUDIO] anything else, let me know. I click a button, it sensor the response. It literally takes a few seconds. It's very low friction for me because people don't overuse it and abuse it. If they did, I'd probably stop doing it. But they don't. And it's really personal and confidential. And it creates a lot of stickiness in the membership because they can get that support when their boss won't help them. Or they're just scared or they don't want to reveal their problems to people around them. And that's how I helped them. That's really interesting. It's on the surface, I would say unlimited one-on-one metrics on scalable. That sounds unskailable. That sounds way worse than a monthly group call. Exactly. I know when I have to show up. But what you're saying is high perceived value. Oh, I can ask a question any time I want. But realistically, they're not pinging you at all hours of the day and night times. That's right. 200 members. I might get one or two a week. I don't get many at all. I just don't get it because I think people see that as, oh, this is a pretty high value important thing. I want to make sure I use it the right way. Yeah, yeah, yeah. I believe it's a case. It's never been a problem. I have a hundred minute plan with video ask. I've never, it's 30 bucks a month. I've never run out of it. I embedded into Kajabi into a lesson. It's a beautiful workflow and funnel that is so easy to deliver and fulfill. Just one or two questions a week. High perceived value, definitely sustainable from Steven's standpoint. The biggest risk I see is in people canceling it who aren't using it for several months in a row. And maybe for Steven's audience, the $39 isn't a big deal. And they kind of want to keep it in their back pocket knowing they have access to it. I should deny the rise. And we talked about this recently pricing your service as a utility where it's is barely a blip on the credit card statement. Is it really worth canceling? I believe this is the entire business model of planet fitness, like let's get a bunch of people in at a low price with the understanding that the majority of them aren't going to be heavy users, but they keep paying because will they plan to start going more next month, right? It sounds really similar. In Steven's example, this was episode 570, I think it's a really interesting one. And maybe one that you could layer on top of an existing product or service offering for some incremental revenue in your own business. So to recap, today we've been talking about 10 recurring revenue sign hustles. The first was software and specifically white labeling a software tool that already exists. Check out the episode with Chris Lillini for more on that. We talked about a local subscription service like the Puperscuper example. We talked about an online subscription service recurring monthly local SEO was the example that we use there. Number four was real estate rental properties. Number five was a membership through the lens of Liz Wilcox's $9 email marketing membership. We talked about six was websites or directory websites as being somewhat AI resistant compared to these traditional article based or information based websites. Number seven was product licensing. Remember check out Stephen Key from Invent Write for more on that. Number eight was recurring web design and hosting through Ryan Golgowski's 180 sites. It was the example there, really, really profitable, really interesting business. Number nine was subscription e-commerce thinking about what kind of replenishable product you might be able to create or even white label. And number 10 was that coaching and mastermind example with Stephen Faust. The comment thread through all of those though is solving recurring problems. That's the way to build some predictability. The same predictability of a study paycheck build that into your side hustle. So you're not starting from scratch every month or dealing with that feast or famine cycle of freelance life. The key I think is picking a model that matches your skills, your interests, your available time. Chris Lilini's software approach requires different sales skills, different strengths than the local service business or then building directory websites. As per the usual, we've got a detailed text summary of this episode on the side hustle nation website, complete with links to all the full episodes mentioned. So you can dive deeper into any of the models that caught your attention. All you got to do is hit the show notes link in the episode description and it'll get you right over there. Now certain side hustles may resonate with you more than others, which is why I want to invite you to generate your own personalized side hustle show playlist of some of our greatest hits episodes. How it works is you go to hustle.show, answer a few short multiple choice questions. You do it right from your phone and it'll build you a custom curated playlist based on your answers that you can add to your device. You learn what works and you can go make some more money. Again, that is hustle.show for that personalized playlist. Thanks to all our incredible guests who share their insight for this episode. Big thanks to our sponsors for helping make this content free for everyone. I want to invite you to hit up side hustle nation dot com slash deals to take advantage of all the latest offers from our sponsors in one place. That is it for me. Thank you so much for tuning in. If you find it value in the show, do me a favor help spread the word fire off a text to a friend. Hey, I think you'll like this. Until next time, let's go out there and make something Nothing happened and I'll catch you in the next edition of The Sign-Usal Show. Hussle on.