Welcome back to coffee time with your host, the Ex-Google Ex- Facebook TechLead.
Today I wanted to talk to you about some of my top tips for
generating passive income, as someone who's been running passive income for over the past decade.
Throughout the years, I've had passive income businesses that would make just a few dollars a day to
thousands of dollars a day and I would find myself wondering: "Why am I even going to work that day if I've already made more
than my day job?"
And then I remember they've got free breakfast.
Now, passive income is this alluring idea where you're making money in your sleep
and then when you wake up your work for the day is already done.
You've already made your money and you can just continue sleeping and you don't even have to wake up anymore.
Many people actually will tell you that passive income is a myth. It doesn't quite happen like that, which is partially true.
So I wanted to clarify for you how this actually works and give you my top tips.
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So what you need to understand is this type of truly passive income.
While it does exist,
it usually doesn't make you much.
It earns you a few bucks here and there, maybe
set up a blog, put up a few
affiliate links,
let it go. And what really happens is if you were to put in a little bit of effort, right, put in some effort into
advertising, marketing and building up whatever passive income you have,
You can actually 10x the amount of growth you have.
It will almost always be more worthwhile
to play somewhat of an active hand in your business, which is why I would think of this more as this concept
I like to call "Leveraged Passive Income"
It's a hybrid approach between passive and active where you build a vehicle for generating income.
You still have to drive the vehicle yourself.
You still have to put in some of that work,
but the amount of impact the money that you make
can actually be multiplied.
So for example,
if you have a store and you're selling some product, a customer comes in, they make the transaction, they leave.
That's 100% active income and you're earning every cent of that.
But if the customer comes in and you give them a brochure and you sell something else and you get a commission on that sell,
that's affiliate marketing.
Then you generate a little bit more income from that.
You still have have to do the same work to bring in the customer,
but the amount of income that you're generating is now maybe doubled.
Now if in addition you get the customer signed up to a mailing list and you start promoting your products and other
products to this person over time, then the lifetime value of this customer
you've just increased by a lot more.
And meanwhile,
you haven't put in all that much additional time and effort into getting this stuff set up.
What you've done is
multiplied the original active income stream that you set up at first.
You're leveraging that original customer that you earned through hard work into additional streams of income
So for example, if you're running a website, you can cross-promote your other websites and products.
You can put in affiliate links and this is an idea that I've been toying with on my YouTube channel as well.
If you check the links in the description below, you'll see there's a bunch of other things I'm promoting.
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But what happens is anytime I publish a video
or for you,
it could be publishing a blog post, launching a new website feature,
making a new product.
It kickstarts this whole passive income engine where all these additional streams of income start making money.
So normally, if I just make one video, I get some advertising revenue and that would just be about it.
That's the active income stream.
But I've actually multiplied it into all these
additional revenue sources and that's what I would encourage you to think about doing as well.
Don't think so much about making something a hundred percent passive, where you can just abandon the whole thing and go to sleep
But if it's something in-between,
if you still have to put in some work,
but then you leverage that work to generate additional income streams,
I think that's going to be far more effective.
Another tip I have for you is to understand that failure may very well be your competitive advantage.
You know, these areas of generating passive income is relatively new, unexplored.
A lot of people don't understand it and I think a lot of people don't start these things
because they're afraid they're going to fail.
And yeah, you will.
You probably will fail your first few times.
But that's okay. Just accept it. Build that into the original cost.
You know
You may have to try two to three times to come up with something that works.
If it were truly easy and mapped out,
everybody would be doing it.
Passive income, especially making it online, is a relatively new industry enabled through the internet
There are so many wacky ideas out there like self-publishing ebooks,
selling merchandise,
making YouTube videos,
Advertising through Facebook and Instagram as launching a Shopify store,
selling merchandise on Amazon, making t-shirts
and countless other ideas.
A lot of these areas people don't understand.
And they haven't written books about.
It's unmapped and you just have to go out there and
explore it and try it and see what works and doesn't and there's going to be failures.
It's almost guaranteed
you're going to fail.
You're going to make mistakes.
You're not gonna get it right
the first few times.
You're gonna lose some money at first here and there, but that's okay!
As long as you limit your risks, don't let it get you down,
learn from those failures,
it's going to all build up to become
competitive advantages for you.
Almost any time I've made serious amounts of money,
it has been through writing a trend
You have to keep yourself open to
opportunities, keep an open mind
and chase those ideas when you see them.
These days, if you were to just start selling t-shirts,
when people have been selling t-shirts for centuries,
it's not likely you're going to see some runaway overnight success business here,
unless you have some competitive advantage that nobody else thought about
or there's some trend that you're writing enabled through technology.
It's funny that for me, I don't consider myself to be particularly ambitious or a hard worker.
Rather, I see opportunities for success.
I know this then and then I feel that success chose me.
I need to just go after that idea and pursue it and see what I can make of it
because I see a clear money-making opportunity sometimes.
And I just think: "I should probably try that idea.
I really should.
I need to make some time to give it a go."
Because I'm not going to be satisfied until
I can see whether this idea works or not and half the time it doesn't work,
but the other half is succeeds.
And a lot of people, they don't pursue their online businesses,
their passive income streams,
because they think they first need to learn how to do coding.
They need to make some website that has order processing and it needs to be automated and scalable.
My tip for you is don't worry about automating it yet.
You can do all the order processing by hand.
You can set up a blog or a website,
throw in some PayPal buttons,
put in some Google forms for order processing if you want.
And just launch it, see how it does.
Every evening,
maybe you'll have to go through and do a bunch of manual processing by yourself,
administrative tasks.
And that's okay,
but over time what you can do is figure out what can be automated and just automate that later.
You can do it through coding, hire programmers.
Or simply just hire people to do the order processing for you.
If you remember when Facebook first launched their "virtual assistant",
they ended up just hiring a bunch of normal people to be on the back and answering people's questions.
And then they tried to use some machine learning to automate some of it.
But it doesn't need to be a hundred percent automated through computers and code.
It can just be a manual process where you hire some normal people.
That's considered automation too, actually.
Just hiring other people to do stuff.
Now as you're working on this passive income stream,
I recommend that you don't talk about it.
And there are a number of reasons.
Number One: I know that when I was starting out this YouTube channel for the longest time,
a lot of people were hating on me.
Friends and family, they tell me this was silly.
I even shut down the channel at one point.
And this has been a recurring theme in my life.
Several years ago,
I was making those silly Facebook apps and games
and the fact of the matter is people just don't understand the business
It's a relatively new area
and people are going to be more inclined to go towards the active income streams that they're used to
where you go into work,
you get paid thirty bucks an hour or so.
No more, no less.
That is purely active income.
If you don't go to work, you don't get paid.
There's just going to be a lot of pushback from people who don't understand it.
As well as their "crabs in a bucket" mentality
where people try to pull you down to where they are.
Not to mention, there have been studies to show that
if you start talking about an accomplishment,
then you lose motivation for that
because you feel that you've already accomplished it in your head.
Even though you haven't actually finished the project,
just by telling other people
by that you feel that you've accomplished something and you start losing motivation
So just do the grind.
And then my last and final tip is:
Rather than inventing your own brand new idea,
which you can do if you like,
I would encourage you to perhaps iterate on other people's ideas
So take a look at what's working out there and you don't necessarily want to copy the idea,
but you can take it and put your own spin on it and then make it even better.
And this is one of the tried-and-true paths to success.
Just take a look at what's working out there and make it better
In product teams,
we refer to this as either a zero to one product, where you're inventing something new.
And usually there's a bunch of risk in this because you don't even know if it's going to work,
there's no product market fit
or you can do a one to two product where you take a product that's already there
and you just iterate on that and make it better
So if you're starting out and want to de-risk the
situation a little,
take a look at people operating in the same space that you might want to be
and really study their products.
Take a look at what they're doing
why is it working and think about how you can put your own spin on it
Make it your own because we all have something we can bring to this world
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So there you have it. Overall I think it's not so much about truly passive income as it is about leveraged income.
Let me know your top tips on generating passive income.
If you liked the video give it a like and subscribe and I'll see you next time. Thanks. Bye