TDW #009: Passive Income Is Hard Work

Passive Income Is Hard Work

In the digital economy, passive income is the Holy Grail for eager entrepreneurs.

Gone are the days of saddlin’ up your horse and plowing the fields, eking out a paltry existence, earning a living by the sweat of your brow. Hogwash! Who needs it!

Let’s trade our overalls for keyboards and turn this whole “making money” thing into something I can “do in my sleep”...three cheers for Passive Income!

Hip, hip...hooray!
Hip, hip...hooray!
Hip, hip...hooray! 

I mean, what’s not to like? The theory is you get paid “mailbox money” for building a system you can “set and forget” as you sip Mai Tais on the beach while raking in the cash.

Only, it never works that way. In fact, I don’t know a single credible digital entrepreneur who doesn’t work to make passive income. 

But that doesn’t mean it’s an impossible reality. With a little readjustment on your expectations, passive income can (and should) be a part of any business’s arsenal.

In a lot of ways, I’m the perfect person to unpack this topic.

I left my $30,000 per year job and, within 12 months of launching my business, was making $30,000 per month. All of which was passive income. But it certainly didn’t start out that way. Not by a long shot.

So if you want to make a go at this passive income thing, here are the 3 key factors for making it work for you...

1.) Start smaller than you think you need to and build from there.

More content does not equal more value.

In fact, with digital products, courses, and offerings… less is usually more.

With my first course, I made the mistake of stuffing it with way too much content. The logic makes sense, right? “If I put more in here it will be perceived as being more valuable!” But more ≠ value. Value = value.

Take digital courses, for instance. Infinitely levered. Build it once and you can sell it a million times. Awesome! 

But a good digital course helps the user accomplish one thing. Take one step. Make one change. From Point A to Point B.

Each course = one step.

Think of it this way: you think about your subject matter all the time. The people buying your course don’t. Give them bite-sized pieces. And make it easy for them to implement the solution you’re giving them.

The downside to “stuffing” a course is people buying, but not finishing, your course. This stymies results. And results are what we’re after! You want those nice, juicy testimonials later on to help you sell more stuff.

2.) Build processes for everything else besides the content and find someone(s) to run it.

After I created my first course, my mentor said to me, “the next 6 months will be the most miserable months of your life.”

And he was right.

See, I believe that all I had to do was create the course content, upload it, and then people would just…buy it. That’s how it’s supposed to work, right? Only…that’s not how it worked. At all.

Creating the content for the course was the easy part. That took about two weeks.

The hard part was getting people to see it. That took months. Lots of webinars, emails, follow-ups, and phone calls.

After you launch a digital product your focus needs to be on two actions: marketing and sales. The highest and best use of your time is bringing more people onboard.

But remember: the more you sell the more people you need to support. This was another unexpected hurdle for me. But thankfully, I had a solution: my virtual assistant.

I was able to completely hand off the customer support aspect of the business to my VA. She handled important pieces of the puzzle like:

  • Lost passwords
  • Declined credit cards
  • Customer support inbox
  • Webinar setups
  • Plus a ton more detail-y stuff I’m forgetting ;)

She also got in the habit of documenting how she handled each task (i.e. SOPs). That way, if another VA needed to step in and complete a task, it was already documented and all he or she had to do was follow the steps.

This allowed me to stay focused on getting more opportunities and selling more. 

3.) Iterate your offering as you go.

Here’s something I wish someone would have told me before I launched: YOU CAN ALWAYS CHANGE YOUR PASSIVE INCOME PRODUCT LATER.

If something’s not working? Change it!

If a module doesn’t resonate? Change it!

If you don’t like the name of the course anymore? Change it!

There are no rules besides the ones you set for yourself. One quick tip: while you can always add content or features to your digital offerings, it’s difficult to get away with subtracting. People notice and they don’t like it. (This is also the main reason for step #1.)

You should also aim to build in recurring revenue as soon as possible. For instance, my first course sold for $997 as a one-time payment OR 12 months of $97 monthly payments. About 20 percent of customers chose the full-pay. The other 80 percent were on the monthly payment plans.

I didn’t know it at the time, but this was my introduction into recurring revenue.

For 12 months I had 80 percent of my clients paying me on a monthly basis. Super easy to plan around a number like that. It gave me tremendous confidence. And that breakdown stayed consistent. (So if I added 10 new clients, 2 would do full-pay and 8 would do monthly payments.)

And this might sound super obvious, but talk to your clients & members and integrate their feedback.

Even now I’ll jump on a quick call with someone who’s purchased a product. I want to know things like:

  • What was the buying process like?
  • What made you decide to buy?
  • What’s the result you’re looking to achieve?
  • Is there anything missing in this product?
  • What doesn’t make sense? What’s unclear?

The responses are gold, Jerry…GOLD. It’s like cheating. You have a real client telling you what to change so more people just like them will pay you faster. Incredible!

Final Words

I say all that to say this: passive income is hard work.

If you’re ready to create passive income, you must first invest in building a strong, expert brand. This approach will not only give you the space you need to create something truly valuable for your market, but it’ll also guide you in creating a product that is unique to you.

When you’re ready, here’s how I can help you:

  1. NEW: Turn your content into clients with the "Content Machine" cohort. (Limited time offer)
  2. Steal my best-performing content for just $9/month.
  3. Watch this video if you want to crush your competition & be the go-to authority in your niche.

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