Do you have a passion, hobby, or skill that could serve as an additional income stream?
In this video, the Motley Fool Answers team is joined by special guest Kimberly Palmer to talk about her book, The Economy of You: Discover Your Inner Entrepreneur and Recession-Proof Your Life. After speaking with hundreds of people who have taken on side jobs, Palmer shares some important takeaways.
Priority No. 1: Whether you're in it for money or passion, you need to start by finding your uniquely personal skill set, then discovering people who have demand for those skills. But even then, there is one tool you'll need almost regardless of what you pursue.
A full transcript follows the video.
This podcast was recorded on Nov. 15, 2016.
Robert Brokamp: So in your book you profile about 100 people who have some sort of a side gig, and you wrote in the book that you were actually having nightmares about your fear of being laid off.
Kimberly Palmer: Yeah.
Brokamp: And so I'm curious. In your experience, how much is that fear of financial ruin ... how much is that causing people to go out and come up with a backup plan?
Palmer: You know, people really fall into two categories. The people are either like me, and totally driven by financial fear, I guess, or financial motivation to want to make more money ... or you just have this big passion and, you know, money isn't so much your motivator, but you just want to share whatever. Maybe it's a hobby you've always done since you were little. Or you want to get back into something you used to do. And launching a side gig is a way of pursuing that without giving up the security of a full-time job.
So, yeah, people are seemingly motivated by either money or satisfaction. The desire to create something and sell it.
Brokamp: Right. You gave all kinds of examples. Someone who worked at a deli and then started a cake business. A cop who started a tax business. What are some of the characteristics of the people who have done it successfully? If people are thinking of doing it, what should they be thinking of now to increase their chances that it's going to work for them?
Palmer: You really have to tap into something that you are uniquely good at, so you have to do a lot of soul-searching, first, to think about what people come to you for, for advice. Maybe you're giving it away free, right now. So, for example, maybe people are always asking you, "How do I set up my Twitter account? Or use Facebook?" Whatever it is people ask you for advice for, that's a sign that maybe you could make money doing that.
So it's really about figuring it out and picking that right thing and then figuring out how to market it and get word out that you now are open for business. And whether it's a product or a service, just finding your ideal customer, your clients, and connecting with them.
Brokamp: I think that's a big part of it, where people might be hesitant, and think of the marketing part. Going out there and putting yourself out there as an entrepreneur or a solopreneur, one of the terms you used in your book. How much of that is necessary to start the business? Can you be a successful side-gigger if you just have no interest in marketing?
Palmer: I think no. I think this is probably the hardest thing for a lot of people. It's definitely hard for me. You have to get in the mindset of being a seller. Like you are selling something and you need to persuade people to buy it, so you have to have some level of comfort with that. Putting yourself out there. Reaching out to people that aren't already your friends and just saying, "I'm open for sales, now." And that's a big mindset shift, I think, for people that can be a hurdle, but it's so important to embrace that marketing aspect, or else you won't be making many sales.
Brokamp: Got you. But how much time does it take? Let's say someone has their full-time job. Like maybe they have a kid or two at home and they're thinking, "I have this hobby. I have this interest. I'd like to do something with it." How much time should they expect to spend on a side gig?
Palmer: It's actually so important, when you're pulled in all these directions, figuring out ways so you don't have to spend too much time and you're being superefficient about it. So it might be doing things like setting up your social media account so you're sharing Facebook messages, sharing tweets, and you don't even have to be on your computer all day when you're doing that. You can use a tool so you just spend an hour scheduling them and then over the next week they come out. By encouraging word of mouth, when you do have clients or customers, asking them to tell a friend. Incentivizing that by doing giveaways and discounts.
The most powerful marketing tool I found was my email newsletter, so I started building up an email newsletter by offering something free for people to sign up with their email, and then suddenly I had hundreds of people. Every time I list a new product on Etsy, I can email them, and those are already people with a good chance who are interested in buying it. So it's about choosing the most efficient methods, because we don't have a ton of time.
Alison Southwick has no position in any stocks mentioned. Robert Brokamp, CFP has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Etsy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.