05/02/2020
Do what you love, the saying goes, and you'll never work a day in your life. Of course, once you've been out in the working world for a few years, you know that doing what you love – and making a living at it – is more complicated than just following your heart.
If you want to swap your current 9-to-5 for a business based on your favourite hobby, you need a plan to monetize your passion.
Do your research, think carefully about your finances, and set short- and long-term goals.
Ideally, you’ll do this work far in advance of going out on your own. The best time to plan is long before you start drafting that resignation letter.
Tips for Turning Your Hobby into a Career
1. Start Small
There are plenty of reasons to begin earning money with your hobby before you try to make it into a career, but let's start with the most obvious: money. In order to get started, you'll need at least a few months of expenses saved up, independent of the start-up costs associated with your business, to make sure that you'll have something to live on while you're getting things rolling.
Beginning your business while you're still working at your old job will also give you a better idea of whether there's an actual need for your product or service, and how much work goes into producing it, which will give you the information you need to work out the particulars of your finances down the road. (More on this in section No. 5.)
Although working two jobs can be exhausting and a juggling act, it's a good way to make sure that you'll still love your new career when you're doing your hobby for money, not love alone.
2. Make Connections
Social media has made it easier than ever to make connections with like-minded people, which is an incredible boon to a small businessperson. LinkedIn, Facebook, Google+, Twitter, Tumblr, Pinterest, etc., can help you virtually meet other people in your industry.
Just remember to proceed with caution: some people will be less than willing to offer business advice to a potential competitor. The best approach is to forge connections before you start asking specific questions. Now is not the time for a blanker form letter, asking strangers if you can pick their brains. The goal is to become part of a community, not mine the competition for ideas and run.
3. Do Market Research
Via your newfound online communities and real-life connections, get a rough idea of how much other businesses charge for the product or services you offer. Sometimes, this is as easy as looking at online marketplaces and seeing what people charge.
Get a sense of what the landscape is like, and how your business will fit into it. What do your competitors offer? What needs does your business fulfil that theirs doesn't? How do you differentiate yourself from your competition?
4. Make a Plan
A business plan is the least glamorous part of starting a new venture, but it can be essential, especially if you're thinking about looking for funding from outside sources. Even if you plan to run your business on your own savings, a business plan can help organize your thinking about your new adventure and expose any unforeseen problems.
5. Plan Your Finances
As part of your business plan, calculate your monthly expenses, projected income, and total start-up costs, including any new equipment you might need, and costs like membership fees for professional associations, online marketplaces, or accountants or tax preparers.
You'll also need to plan on paying quarterly estimated taxes, including self-employment tax.
Eventually, you'll have to decide whether to remain a sole proprietor or to choose some other form of business organization, including limited liability company, S-corporation, and so on.
6. Get the Word Out
The internet makes it easier than ever to let people know that you're hanging out your shingle. In the olden days, you might have had to allocate a significant part of your budget to advertising and lead generation, but now you can get started simply by posting on your favourite networks and letting people know you're open for business.
Just remember that if you're still working at your day job, you might need to be discrete.
Make sure your company doesn't have a policy against freelancing or working part-time, and that your business doesn't rely on any trade secrets you've picked up from your job. If all those conditions are satisfied, think of a one-line description for what your business does, and share it with the world.
7. Reassess Your Goals
Even with careful planning, you won’t know what it will be like to run your own business until you do it for a while. So, it makes sense to reassess your goals at intervals to make sure that you’re on track.
Most likely, you’ll discover that your goals will change over time. You might find out that you love one aspect of your work more than others, for example, and decide to place more focus on that area. Or, you might learn that the market for your product is weaker than you expected, and change direction slightly to capture more business.
The best thing about working for yourself is that your job will evolve. Understand that, and you’ll be prepared to change tracks when necessary and succeed.
This article has been sourced from www.thebalancecareers.com
