As an entrepreneur, you’re bound to get a ton of business ideas daily, but every idea isn’t going to allow you to live the life of your dreams. When you choose an idea, you must ask yourself if it’s something that you’d be willing to work long hours on? Just because you spend hours doing something as a hobby, doesn’t mean you’ll enjoy spending hours on it as a business.
When I first got started as an entrepreneur almost three years ago, I focused on something that I liked doing but it was not generating any income and I began to hate. Which in turn made me not want to even work on the business. As you know, if you don’t work on your business, you don’t grow. I won’t lie, it took a couple of pivots for me to finally get comfortable with where I am.
However, I have come to realize that when you move your idea from a hobby to a business, you must change your mindset, and you may also have to pick up some new skills.
Here are 4 steps to convert your business idea into profits.
Pick your income type
When deciding how you want your business to function, you have to know what kind of income you want to make. You can generate active income, leveraged income, and passive income from your business. Do you want to work in a way that’s similar to your 9-5 job, serve groups of people at once, or offer something that allows you to get paid indefinitely without much maintenance?
Active income: You can use this income to generate income quickly but it requires a hands-on approach. An example of active income is coaching or consulting. I recommend setting this one up first so that you can work with a few clients to really decide what industry you would like to be an expert in.
Leveraged income: This is when you leverage your time to work with many people at once and increase profits for the time invested. Examples of leveraged income are group coaching or membership sites.
Passive Income: This is when you create something once and it continues to pay you. This type of income can be digital products such as books, planners, ebooks, guides, etc or courses.
Once you have this done, you can decide on what you’re going to offer and how you’re going to price it.
Validate your idea
Before you launch your business idea, you need to know if there is a need for what you are doing.
Yes, there may be many other entrepreneurs doing the same thing, but that doesn’t guarantee you will have the same success or any at all.
Find a group of people in your target audience, share your idea with them and see how they respond. You can even conduct research calls via Zoom to ask questions and dig deeper to learn the type of guidance and support that is needed. You can ask about what your offers should be, what format they would like it in, how much you should charge and so much more.
They may love what you want to offer or may have some suggestions on how it can be improved to meet their needs.
This validation process can help you save time and money, and it can also help you get your first customers and clients when you launch.
Create your money map
Now that your idea is validated and you know what people are willing to spend on it, you can set your price and see what it will take to reach your goal.
Let’s say you start with passive and leveraged income, and you offer eBooks ($30 each), online courses ($397), and private coaching ($997).
To earn your income goal of $150,000, you would need to sell:
- 20 eBooks a month
- 20 courses a month
- 4 coaching clients a month
You can modify your money map at any time by adding or removing offerings if you feel that you can scale your business further by doing something else.
When you build the right relationships, you put yourself in a position to receive more opportunities that will help you become more profitable. Your net worth equals your net worth, but this doesn’t mean you should make friends for your personal benefit. Build genuine relationships with others who you can invest in, and provide value to so they can live the life of their dreams.
Ready to convert your business ideas into profits? Book your Enrollment Call to join Business Accelerator, my new program to help support you through this process.