I cringe every time I hear someone advise turning a hobby into a business. Advising those in debt or needing extra income to build a business around one of their hobbies isn’t necessarily a bad idea, the thing is most hobbies aren’t particularly suited to turning into a “million dollar business”. Although it seems that all great entrepreneurs get rich by doing something they love, it’s also true that they didn’t make a million by love alone.
Become a Millionaire by Turning Your Hobby Into an Income
The premise of these posts goes something like “you enjoy doing X, so why not do a bit more of X, and then sell it?”. Although this is good advice on which to try to make a few bucks on the side, it’s not a great idea if you’re looking to quit your job and start doing your hobby full time. Here are the reasons why i don’t think this is the best of ideas:
1. Although you probably know the market reasonably well, chances are the consumers for your hobby business are much the same as yourself, i.e. they don’t need your product or service, but take it as a source of enjoyment. Is the market big enough to support you and your needs fully?
2. Scale production and time constraints will rapidly take the fun out of your hobby. Think about it, do you do your hobby to get away from day-to-day problems?
3. The competition in the sector is probably fierce. For every hobby goer, there’s a big corporation producing the same product, often with the benefits of economy of scale. All they have to do is drop the price of the product to the barest minimum, and price you out of the market. Can you distinguish your product or service enough to make a difference?
Businesses succeed because an entrepreneur finds a need that isn’t currently fulfilled, or isn’t adequately catered for. Although many entrepreneurs start with a product or service they love, those who succeed aim their product at an under appreciated market. Starting a business on the sole basis of you enjoy doing it a few hours a week is a recipe to it folding in short order. The “hobby entrepreneur” has to realise that drastic changes to their business model will be needed before it even has a chance of being a million dollar earner.
There is one exception to my no hobby business rule, and it’s probably the one hobby that many readers of this blog already have. The only hobby that can be turned into a viable business easily is “armchair entrepreneurship”. While developing a broad knowledge and a skillset from your armchair through blogs such as this, courses and books is no substitute for getting out there and trying something, it is a close second. The generic skills you learn here and through your other research can be applied throughout the business spectrum.
So although I’m not against starting a business from your hobby, think twice before you set off about your goals, and if a hobby business can fulfill them.
THere is no substitute for hard work – hobby, business or anything in life
Spot on FriedBeef, hard work in anything is what’s required to get ahead. The way I see it is that you might as well be working hard on something that has good returns, either financial or emotional.
I think a balanced sense of perspective is very important in a business and if you turn a hobby into a business, you might not be able to be as objective as is required.
Thanks for your comment Shalini.
Unfortunately it’s easy to take any business idea or plan and turn it into “your baby”. This can lead to a lack of objectivity, and to poor decisions. With a hobby i suspect you’re right, it’s probably even easier to lose perspective.
If you are starting up your hobby as a business I think exposure is the key, combined with the business plan. If you plan things they should go the right way, well most of the time.
If do decide to get your hobby business online and start promoting it I can recommend a good site to start off with: http://www.hobbything.com/ – which is a social hobby network.
You can use it to showcase your hobby by creating photo albums, posting stories and participating in the forum. All of which give you the marketing you need linking back to your site. And due to the fact that it is a hobby site those back links are really good for your own site and help you get better rankings in google searches. Plus you might get your first clients from there as well you never know.
These days everyone uses social networks to promote their business due to the fact that everyone uses one or another. So if you take your hobby on the next level and start your own business I think http://www.hobbything.com/ could be a great addition to you marketing plan.
Cheers
Dmitri