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While people have been engaging in some type of "sideline" activity for centuries, the practice has grown much more prominent in the past two decades. Since the advent of the Internet, millions of 9 to 5 workers have devoted their extra time and resources to making money from sideline jobs. According to a survey by Bankrate, almost half of full-time employees take part in some kind of “sideline” outside of their traditional job.
These activities can range from starting a fashion blog to working as a freelance delivery driver – and everything in between. When my co-founder Sabine and I turned Dormzi from a service-based network into a marketplace run by young people, our vision was to help students lean into their sideline. One of the challenges we've seen since then is that many aspiring entrepreneurs believe that they would have to drop out of their 9-5 job or schooling altogether in order to turn their sideline into thriving businesses. Fortunately, this is often not the case. Let's look at some real-world success stories to show how you can turn your side business into full-time:
Large companies that started as a side business
It is a common misconception that your part-time job can only become a successful business if you devote 100% of your time and money to it. While it is true that you can't just expect a sideline to grow into something more without an effort, you can turn a sideline into a full-time business without quitting your day job. How exactly can you do that By regularly funding your side business with a portion of your 9 to 5 paycheck.
It sounds too simple to be true, doesn't it? The fact is that a lot of sideline jobs remain sideline jobs because people don't put extra resources into them. For example, if you offer writing services, you can pay to develop a website that markets your services and makes you look more professional. Without a website, you will likely struggle to attract new customers and turn your sideline into a long-term business venture.
Related: 50 Ideas For A Lucrative Side Job
To refute the naysayers, let's take a look at a few entrepreneurs who have invested in their side businesses and are now running highly profitable businesses:
Aytekin Tank, founder of JotForm
Prior to founding JotForm in 2006, Aytekin Tank worked as a senior web developer for a major Internet media company in New York City. During his five-year tenure, Aytekin Tank was hired to create tools that would enable editors to create unique forms such as surveys. Aytekin Tank, however, found the tools available on the market often completely inadequate.
So JotForm was born. While Aytekin Tank struggled with his day job, he spent his free time developing one of the world's most popular online form-building tools. His work as a senior web developer provided enough additional resources to turn his ideas into reality. Over time, Aytekin Tank put away a small portion of his paycheck until he was ready to start JotForm. Then he had the resources to hire a team, grow his start-up into a full-time company, and become one of the dominant forces in his niche. Today JotForm has over 2 million subscribers and is counting!
Andrew Mason, Founder of Groupon
While working toward a degree in public order at the University of Chicago, Andrew Mason began developing The Point, a platform that introduced the "turning point" concept of donating money for a purpose. With The Point, users can collect donations together to achieve a common goal. However, unless the goal had reached a certain number of supporters or a minimum amount, no one would be charged and the goal would be abandoned. This "turning point" concept would later form the basis for Andrew Mason's later endeavors, Groupon, with partners Brad Keywell and Eric Lefkofsky.
Related Topics: 18 Sideline Activities That Can Help You Make A Profit In 2020
Andrew Mason and his partners put a lot of time and effort into The Point, which turned out to be a failed idea, partly due to the lack of focus. However, they found that one aspect of The Point was particularly popular: the collective purchasing power of group deals. That's how Groupon was born in 2008.
Andrew Mason worked as a server and a number of other odd jobs to pay his way through college and set aside money for creating The Point. In addition, he was able to start The Point with funds from his future Groupon partners. Even when The Point turned out to be broke, Brad Keywell and Eric Lefkofsky stayed by Andrew's side. The trio turned their initial failure into massive success, creating a company valued at over $ 2.4 billion!
Eren Bali, founder of Udemy
In the mid-2000s, Eren Bali worked as a freelance web developer in Turkey. While working for various clients including the now defunct Speeddate.com, Bali devoted his extra time and money to his own passion project. In 2007 he developed software for a virtual live classroom. He saw a lot of potential in his new creation, so he saved the funds to move his base of operations to Silicon Valley.
In California, Eren Bali met with Oktay Caglar and Gagan Biyani to create Udemy, an open online course provider. The website started in 2010 with minimal funding. In fact, Eren Bali and its partners have tried and failed 30 times to gain investor interest. However, the platform's early success enabled them to raise $ 1 million in just a few months. Later on, Groupon investors Eric Lefkofsky and Brad Keywell would help raise more capital for the emerging company. By early 2020, Udemy was worth roughly $ 2 billion!
How to turn your sideline into a full-time business
It's easy to look at success stories and feel like these side hustler business owners just got lucky. While there is a degree of luck associated with any business venture, there are actionable steps you can take to turn your side business into a successful full-time business. Using the examples above, you can reverse engineer your experiences to find a process that works for you. So let's take notes from successful entrepreneurs like Aytekin Tank, Andrew Mason, and Eren Bali!
Related Topics: Get Access to Kim Perell's Side Hustle Accelerator for just $ 30 for a limited time
Find and perfect your idea
In all three of the examples above, the founders of successful side hustle businesses had ideas that they put into action. Often times, these ideas combined their existing skills or passions with a niche in the market. For example, let's say you are an excellent communicator and have expertise in a particular niche. You could start advising companies in this niche. From there, you can allocate funds from your job to marketing and grow your advisory services into a full time business! This brings us to the second important step …
Develop a funding strategy
Most people take up sideline jobs to make money. However, in order to turn a side business into a business, you need start-up capital. As a result, you will likely have to devote a small portion of your paycheck to building your side business. This may sound counter-intuitive, but it is actually a solid business strategy.
Think about it; If you quit your job just to focus on your sideline, you will reduce your income significantly and risk putting all your eggs in one unpredictable basket. Alternatively, if you regularly set aside funds from your job (or sideline) to build your business, you are essentially investing in your future without taking any additional risk. In time, that nest egg could be enough to get your business up and running. If you still need more capital, you are always welcome to look for investors or take out a small business loan to keep things moving!
Start your business
It may seem like an unimportant distinction, but a side business becomes a business once you identify it as such. Secondary jobs are essentially part-time work to earn extra money. Businesses are long-term investments with the potential to grow and generate much higher returns. Once you officially form your business as an LLC or similar company, you have taken an important step in your transition from side hustler to business owner!
As shown in the stories above, side deals are generally low risk. You're spending a little extra time and money to (hopefully) make more money or come up with a unique idea. However, starting a business carries a much higher risk. When Aytekin Tank started JotForm, he made an effort to pay and manage his ever-growing workforce. Andrew Manson's first start-up, The Point, turned out to be a major failure despite the fact that he developed a much better and more profitable website. Eventually, Eren Bali and his business partners failed to secure funding dozens of times before finally getting the capital they needed to grow their business. In all three examples, these entrepreneurs started their side business despite the risks involved.
Time to get started
If you're turning a side business into big business, you don't have to quit your job. In fact, a day job has enabled hundreds of entrepreneurs to routinely fund their side jobs and eventually convert them into full-time businesses. Aspiring entrepreneurs sometimes argue that quitting their hated nine to five jobs to focus on full-time business increases their chances of success. While there is validity to the point that you can't just "set it and forget it", you don't have to completely transform your financial life or career to build your business. Instead, routinely finance and routinely devote extra time to your sideline until you're ready to start your business.