From passion to profit
If you’re flirting with the idea of starting up your own business, you may be craving unfettered freedom, creative license and earning potential. However, you may also be plagued by doubts as to whether you’re cut out for entrepreneurship.
If this sounds like you, it’s worth resolving your concerns as soon as possible to save yourself the mental anguish of cycling through the same old questions over and over, while your ideal future sits on ice.
To help you create more awareness, decisiveness and momentum, I’d like to share some excellent questions I received the other day from a creative individual who’s looking to transform a passion into a business.
The questions are as follows. Perhaps you’ll find some of them familiar.
Why would somebody buy or care about my creation? It’s just a hobby. What right do I have to sell it?
How can I market myself when I’m not a marketer?
How can I make the jump from a reliable salary to something much scarier, when I have financial responsibilities like a family and mortgage?
At their heart, these questions seem to be asking, “Is it safe for me to set up a business?”
This a legitimate concern given the wide-reaching consequences of exploring a new endeavour that’s as much about fulfilling your potential as it is about prospering from it. So, let’s walk through the above questions one-by-one to help you make a decision that feels safe and inspiring.
# 1. Why would somebody buy or care about my creation? It’s just a hobby. What right do I have to sell it?
I can’t answer this set of questions without first commenting on its beauty.
Artists often strive to create beauty by balancing contrasting and complimentary colours, textures and perspectives. In the same way, these questions dance between healthy self-confidence (it takes courage to articulate such vulnerable parts of yourself) and self-doubt (which you’ll spot if you re-read the questions).
Without a conversation, I can’t say for sure which end of the spectrum rings truer for you, but I believe that embracing both sides of yourself (confidence and humility) is a winning recipe for life and business. So, assuming that self-doubt is not weighing you down, I hope you continue to strike this delicate balance on your journey.
Introspection and art lesson aside, there are some important business aspects of this question to explore. First, why somebody would buy or care about your creation?
Because you offer value.
This is how the market works. Yes, it’s as simple as that.
I want something you have because it’s going to make my life more wonderful. Therefore, I’m willing to enter into a fair value exchange in order to acquire it.
When you look at it this way, I wonder: do you still query whether you have a right to sell your creation?
Or would you say you have a choice to whom you offer your value, just as your market chooses whether to buy from you or not?
(You might want to pause here for a moment to roll this new perspective around your mind and mouth and see how it tastes.)
Finally, given your statement that your work is “just a hobby”, I think it’s worth exploring whether it will remain a hobby or has business potential. I note that there’s no ‘right’ solution to this; both are worthy pursuits, but one will feel truer for you.
To help you answer this question, perhaps you’d like to reflect on which of the following definitions best fits your situation.
A hobby is any activity you love to engage in; while a business refers to a series of organised efforts that provide value and generate profit (and which, of course, you can love too).
Is it obvious which category your work fits into? Or do you need to gather more information?
#2. How can I market myself when I’m not a marketer?
This question assumes a basic understanding of marketing. So let’s tend to that first.
What is marketing?
In simple terms, it’s serving your customers. Marketing governs your customer’s experience with your product or service from the very first time they hear about it until… well… until forever after.
From this definition, you can gather that marketing is diverse, so some aspects of it will likely come very naturally to you and others will be harder.
If you create products for example, perhaps you enjoy applying your technical skill to optimise your customer’s experience with your product. If you deliver services, perhaps you love interacting with your customers to co-create positive outcomes. You can think of these moments as the middle of your customer’s journey; but perhaps you’re not yet familiar with the beginning and end: the parts where you set your marketing strategy, identify and connect with your customers, decipher what people value about your offer, negotiate a fair value exchange, provide post-purchase care and so on…
No-one is born adept at all of these marketing elements, so your job is to be a quick study. Work out what you love, what you’re happy to learn, what you can afford to delegate or outsource — and with practice and experimentation, you’ll not only develop a deeper understanding of how to serve your customers but you’ll become a more adept marketer in the process.
How does that sound?
#3. How can I make the jump from a reliable salary to something much scarier, when I have financial responsibilities like a family and mortgage?
This is such a powerful question because it acknowledges the importance of being financially savvy as you pursue your entrepreneurial dreams.
If you want to make informed decisions about your life, it’s critical to have a clear view of your financial situation. And I’m not talking about doing some quick maths in your head, let alone licking your finger and raising it in the air. People are always WILDLY off when they guess their projected income and expenses.
To successfully make “the jump [or transition] from a reliable salary” to running your own business you need to build a financial model that gives you an accurate sense of what to expect.
Please don’t freak out! It’s not as bad as it sounds.
Financial modelling is just a fancy term for telling a story with numbers. And the story you want to tell is how much you need to earn to survive (and better yet, thrive).
When you map your finances in a spreadsheet, you can use these as a reference point to answer the question in the header above as well as other big questions like:
What’s the minimum income my family can survive on this year?
What’s our ideal income in order that we might thrive?
How can we reallocate expenses for more joy or to grow the business?
Which new revenue stream holds the most promise?
Is my passion project better off as a hobby or a business?
If you’re not sure how to build a simple financial model — or couldn’t be bothered — feel free to grab a copy of my own model.
I use a simple income and expenses spreadsheet with formulas to pull through all the important numbers and a clean presentation, which (as I can tell you from years of building financial models for the likes of the EYs and Deloittes of the world) is all you need. If you’d like a copy of this model, get in touch.
A big thank you!
Finally, a big thank you to the person who was brave enough to ask these intelligent questions and kind enough to grant me permission to share them with you. In doing so, they’ve allowed me the opportunity to contribute the value I enjoy sharing and you the opportunity to learn alongside them.