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Screw Passive Income, I Want Active Income
46 points by vi1rus on Aug 26, 2016 | hide | past | favorite | 25 comments
I keep reading threads in HN talking about passive income, small side gigs that make money while you sit.

I don't want that. I want to escape my 9-5. Reach financial independence. I don't care about expensive cars, houses with multiple rooms I won't use.

I just want to work for myself and live my life.

How do I do that?

Skill set: Average Developer, understand marketing, SEO, exceptional Project Manager




Some options:

1. Build a product (SAAS) in a niche domain. Charge between $50-$100/Month. Get 75 customers.

2. Buy an existing SAAS in a domain that you have interest in (experience a bonus but not required). It should bring in profits of 5k/month (give or take). If the business is rock solid and at least 3 years old with a sustainable rate of revenue, then expect to pay 3X (3 years of profits) upto 5X (depends on many factors). You may even find gems for less than 3X multiplier.

3. Start a "Service" based freelance business but offer a specific skill. For example, "I will help you host wordpress sites for $x/month and fully manage it for you". Charge a flat monthly fee. Kinda like Step 1 but "service" based instead of "product" based. The trick is that you don't deviate too much from the scope otherise it will be difficult to do it as one man show and you will end up going towards a "agency" type model.

4. If you are really good at something and have the skills to create a good tutorial, start something like https://www.laracasts.com and provide solid content regularly to your subscribers. Charge a flat fee per month.

All these 4 things are extremely difficult to start with BUT very possible to do. I have done #2 myself fyi and already grown it 6 times in 2 years.


Where did you research sites to buy? Places like flippa seem sketchy, though I remember patio11 recommended feiinternational.com when he sold his business.


I think you meant http://feinternational.com right?


Yes, that's right, thanks


Yea i found one rare gem on flippa. Feinternational is also ok but both are limited. Flippa is mostly low end and fe is mostly 50k or more range. Honestly, look for word of mouth if possible too. Niche online communities are a good way to find potential sellers/sales


The key is to find them before they Flippa.i if you peruse forums you will find threads of ppl contemplating a sale, asking for advice. Get them there.


You can still find stuff on Flippa but it is completely different than 10 years ago; those were it's golden days. Not sure if anything replaced it...


This is a pretty good set of options. Especially the first option broken down by customers / price.


Honestly, I slowly moved away from being a developer. Anyone with an idea can hire a developer to make their SaaS project, or whatever the idea is. The money is in the marketing of the project.

I switched to affiliate marketing and making ecommerce stores. Less time developing and more time just selling. Facebook Ads & Instagram are a godsend.

This is both active and passive income. Once things are rolling you can hire a VA for super cheap to make sure things keep running smoothly. This lets you take time off while keeping keeping the machine running. If you want to be active you can push out new products, niches, and just scale what is already working.


Hey man, I have a quick question. You may know the answer, you may not, it's a shot in the dark but I'll try anyway.

I've been wanting to get into the affiliate marketing space for a while now. I was curious if one way to approach is to setup a shopify-type store which contains actual products I'm looking to sell, but the links to the products actually go outbound to amazon affiliate link or something else, or is your approach more blog-related, where you type text about something and then include affiliate links within the body of the blog post? Have you tried both, which is more effective?

The other thing I've researched and read a lot about is how to validate an idea to see if there's interest. The way to do this is to setup a simple 2-page landing/splash page on Strikingly, Unbounce, Instapage, or any other similar site, explaining what your product or website is about, with a direct button to complete the purchase, but then you redirect the user to a "Sorry, we are not yet ready", and see how many "convert" - that is, users who are immediately ready to pay for said product. Do you do any of this validation for your affiliate marketing sites, or do you just open them and start selling through your web store or blog posts (depending on answer from first paragraph)?

Thanks so much for taking a moment to help me get started.


I don't do any amazon affiliate type stuff as the money isn't great so I can't really help you there. There are things out there that can pull a feed from amazon and display the stuff on your site.

I have done that type of validation before. Often I'll do that if I am testing between multiple offers to see which works best. But usually with affiliate marketing you don't need to do that since they aren't purchasing anything from you, it just redirects to the advertisers site.


I used to be in ecommerce long ago, but I don't even consider it anymore because of Amazon's dominance and the overall saturation, unless one is creating a novel product / trend.

Did you create new products or simply better at marketing products that are readily available on Amzn etc?


Pretty much everything i promote is not unique. Either affiliate marketing or items just bought off ali express. Not all of it is even available on amazon, lots of little random items.

What I sell isn't any better than anywhere else, it is just the marketing that gets people in.


Find an SaaS in a medium sized market where most competitors are one man shops with low switching costs for customers. Replicate the best competitor, improve on features, and undercut prices. Identify their advertising channels and insert yourself into the mix.


What's your definition of medium sized?


A market with enough customers to get to $10k/month revenue within a year with few competitors, preferably none of which are multi person companies.


Offering proxies as a service is a great example of this. As well as most Wordpress plugins.


Currently attempting to do this. Marketing and getting to those first few customers is the hardest part, even though I already built a functional full stack web application.


Check out my site: IndieHackers.com. There are some great examples there. After conducting the interviews found there, I agree with people who emphasize marketing over development. You need to work on something that solves a well-defined and valuable problem for a segment of people, and you need to know channels through which you can share it with these people.


Find a unmet or poorly met need that you are also passionate about. And then make the best damn solution you can to address it.


Here is a good podcast on this subject: http://thestartupchat.com/ep126/

A significant number of the self-funded startup people that I come across used the stair-step approach that's described in the podcast.


Become a founder building projects that scratch your own itch. The 37signals (neè Basecamp) guys have written quite a bit about this.

Consulting is probably a faster way to financial independence than founding is, but founding is more about lifestyle independence, which seems important to you too.


What is the monthly take home income (after tax) you aim for to be comfortable enough for your lifestyle


$3.5K is enough to comfortably support me $7k-10k would be epic


We're working towards that by paying the mortgage of asap. Just boring old living frugally while trying to maximise income. One twist is to rent our place out and rent somewhere cheaper.




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