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- Hey, friends, welcome back to the channel. In
this video, we're gonna talk about nine different
ways that you can make passive income. And
for each of those, I'm gonna talk about how
hard it is to get started, how hard it is to
make $100 a month from it, and how hard it is
to maintain. once you've created the thing in
the first place. For me, in my business, these
nine different sources generate around $27,000
per week, these days, with varying degrees of
passiveness. And obviously, this has taken me
like eight years to build up. So don't expect to
be hitting those sorts of numbers when you first
get started. But this is the video that I wish
I would've had when I started my financial
independence journey many, many years ago,
let's go for it. All right, so when I say passive
income, I always air quote it, because there is
really no such thing as passive income, there
is no way to make money without doing anything
at all. But when I say passive income, what I
mean is that it's money that is not directly
tied to our time. So let's say you were to write
a book. If you write a book, you publish a book.
That book is now in bookshelves. You've done the
work kind of once, to write and publish the book,
but now, anytime the book sells, you make money
from royalties, that is passive income. You
could literally be making money while you sleep,
because you've created this thing, which is out in
the world, which is generating income for you. The
other thing with passive income is that it always
takes a very long time to get going. So if you see
any ads before this video, talking about how you
can get rich quick, by whatever scheme, or if you
see people in the comments pretending to be me,
saying, "Oh my God, "here's how you can get
rich quick with crypto, "WhatsApp this number,"
that is all a scam, it's not gonna work. There is
no way to get rich quick, it is not a thing. So if
you're looking for a get-rich-quick scheme, those
things just don't exist. So you might as well not
even try. And the way I think of this is that,
ultimately, money is just a medium for exchanging
value. The only way to make money is to provide
value. And the only way to make passive income,
passive money is to provide value in a way that is
not directly tied to your time. So please, please,
please, do not try and join a get-rich-quick
scheme, they don't exist. I've had lots of
messages, over the years, from people who have
tried signing up to a get-rich-quick crypto
scheme or a gambling scheme or a "Hey, here is how
you play poker online." None of these things ever
work. People always end up losing money. The only
way to make money is by providing value. And so,
let's talk about the nine different ways that you
could provide value if you wanted to. Just before
we dive in, I wanna tell you that I've just
launched my brand new Skillshare class about
productivity for creators, how to start a
successful side hustle. That's linked to the video
description. Skillshare is sponsoring this video.
I'll tell you more about skill share later on, but
I wanna plug my own class, because I think it's
genuinely really good, and people really like
it. And it'll help you get tips on how you can
start side hustles in your spare time. Anyway,
let's get into the video. All right, so let's kick
things off with investing in stocks and shares.
And in this context, the way that we provide value
is by offering up our money, providing money and
investing in a service is, in a way, giving a
form of value. And so, when we give our money to
a company in the form of buying their stocks, it
makes sense that we would get some kind of return
for that investment. And we're starting with this
because investing in stocks is the easiest way to
make any kind of passive income. If you have
any sorts of savings, and they're sitting in a
savings account, earning 0.01% interest, they're
not really doing very much for you. Whereas,
if you had those stay of savings and put them
in stocks, you could potentially be earning
passive income from the money that's otherwise
just sitting there. Now, I've got a whole video
called the ultimate guide to investing in stocks
and shares for beginners, which is gonna be linked
over there somewhere. So that is a solid, half an
hour long introduction to stocks and exactly how
they work. But the thing that I recommend for most
beginners as a non-financial advisor, and this is
not financial advice, purely for entertainment
purposes only, or so people say, or, at least,
the thing that I do is that basically all my money
that's in stocks and shares is invested in index
funds. Now, an index fund is something like the
S&P 500. And when you invest, let's say, $1,000
in the S&P 500, that basically means that your
$1,000 is distributed amongst the top 500 biggest
companies in the US. So, you know, weighted by how
big they are. So like 2% of it would be in Apple,
2% in Facebook, 2% in Google, 2% in Microsoft.
And then you probably wouldn't have heard of the
500th company on the list, but basically,
all the big US companies you've heard of,
you end up investing in all of them a little bit
at a time. So if you wanna get started with that,
all you need to do is sign up to a stock broker.
If you're in the US, you can use Webull, I think
I've got link in the description. If you're in the
UK, you can use Freetrade or Vanguard. Basically,
whatever country you're in, just Google
the phrase "best stock broker platform,"
your country name, and you'll find something that
works for you. And then it's very easy to be able
to invest in an index fund. So within our famous
Side Hustle Assessment Matrix, we're gonna give
the difficulty of starting a one-star rating,
one outta five. It's very, very easy to get
started with stocks. How hard is it to make $100
a month by investing in stocks and shares? Well,
this kind of depends, because it depends on the
performance of the stock market overall. So in
the last 12 months from 2020 to 2021, the S&P 500
is actually increased by about 50%. That is a lot,
it's like gone up by a solid 50% despite COVID
and everything going on. So if in April, 2020,
you had invested $2,400 in the S&P 500. The fact
that it's gone up by 50% means you would've made
$100 a month, but obviously, this is not the way
to look at it, because things can go up and down,
and the stock market has different levels of
performance, depending on what time period
you're looking at. But if we average out the last
30 to 50 years, the S&P 500 has had a roughly
10 point something percent return, which means,
every year, on average, over the long term,
it goes up by around 10%. This is not inflation
adjusted for any economist among us. And so,
if we do some back of the envelope calculations,
if we wanna earn $100 a month passively through
stocks and shares, we would need around about
$12,000 invested in the S&P 500 to make that
10% $1,200 a year, which is $100 a month. But
as I talk about in that video about stocks,
over time, we have compounding. And so, if you
put in $7,500 in the S&P 500, and you left it
there for five years, then five years later,
you would be making roughly $100 a month,
if we go by this very average figure of 10% a
year. Or if you invested $5,000 in the S&P 500,
then 10 years later, you'd be making $100
a month in purely passive income, again,
assuming the 10% average. So overall, how hard is
it really to make $100 a month in passive income
from stocks and shares? Well, it kind of just
depends on how hard is it for you to make $5,000,
$7,500, or $12,000 in savings and put them into
a stock market index fund, and crucially, this is
money that you shouldn't need to touch in the next
5 to 10 years, at least. So basically, how easy is
it for you to make that sort of money obviously
varies massively depending on which country
you're in and what your circumstances are and what
your job is. But if you're in the UK or the US,
where the median, kind of average salaries are
around about $50,000, something like that, then,
again, depending on your circumstances, it's not
that hot to get $10,000 in savings. Obviously,
if you're supporting a family of 15 people on
$50,000, it's different. If you're a single
person, again, it's different, but I'm gonna give
this roughly a 3/5 star rating for difficulty of
getting $100 a month. Obviously, if you live in
a country like India, where the average salary is
$3,600 a year, it's very, very difficult to make
$10,000 in savings overall. And finally, the third
category in our Side Hustle Assessment Matrix is
how hard is it to maintain this income once you've
set it up in the first place. And we're gonna give
this a 1/5, because once you've got the money in,
you just like set it and forget it. And it's not
that hard to maintain. There are other sources
of passive income that require higher degrees of
maintenance over time, but stocks and shares is a
very, very easy way to make passive income, and to
use my personal example, these days, my stocks and
shares portfolio, which I've been investing in
since 2015, is now worth around about $350,000.
And the vast majority of that is in the S&P 500
index fund. Now, I can't be bothered to work out
the actual inflation adjusted returns for that.
But again, if we assume a very, very rough average
of 10% a year, then that average is out to around
$682 per week in purely passive income. All right,
idea number two for generating passive income is
to start a YouTube channel. This is something I
will specialise in, because I'm here on YouTube,
and I actually teach a course called the Part-Time
YouTuber Academy, linked in the video description,
where I teach people how to do this sort of thing.
So let's use our Side Hustle Assessment Matrix,
and we'll talk about this. How hard is it to start
at YouTube channel? Well, I'm gonna give this one
out of five stars, because it's actually very,
very easy to start at YouTube channel. You just
go on youtube.com, you click create a channel,
and you can upload videos by just filming
with your phone and uploading it. In reality,
it's a lot harder to make good videos, and
making good videos is how you grow on YouTube.
But getting started on YouTube is very, very, very
straightforward. The real question is how hard is
it to actually make real money from YouTube? So
again, let's say we wanna make $100 a month in
passive income, what does that look like? Well,
firstly, to be eligible for monetization on
YouTube, you need a thousand subscribers and 4,000
hours of watch time. It took me six months and 52
videos to get my first 1000 subscribers. And if
we look at the averages, it actually takes on
average 90 something videos to get to a thousand
subscribers. So, that's quite hard. If you're
thinking you're gonna start a YouTube channel and
start making money from day one, that's basically
not gonna happen. It took me 52 videos, six months
to get there. So if people message me like, "Hey,
I wanna start a YouTube." I was like, "You
have to be able to put in the effort "and do
this for a very long period of time, "at least
once a week." I say, for at least two years,
before you can expect anything in return, but
let's say you've hit your thousand subscribers
and your 4,000 hours of watch time. How hard is it
to actually make $100 a month? Well, on average,
the kind of revenue per thousand views on YouTube
is around about $2. So this varies massively,
but let's say, on average, about $2 per thousand
views. Therefore, if you wanna make $100 a month,
you need 50,000 views on YouTube to make $100
a month. Let's say you make one video per week,
and let's assume you're not getting any traffic on
your older videos. That means every video you make
needs to get around about 12,500 views. And very
roughly, the average YouTube channel can expect
around about 20% of their subscribers to equal the
average view count for each video. So on YouTube,
if you had 62,000 subscribers, very roughly,
very averagely, you can expect 20% of them,
i.e. 12,500 views on each video. And assuming
you have no evergreen content of the long term,
you would need to run about 60,000 subscribers to
be making $100 a month. In reality, you make $100
a month a lot before 60,000 subscribers. I think
I was making $100 a month when I had like 10,000
something subscribers. It was fairly early on, but
when it comes to assessing how hard is this to do,
I'm gonna give this a four out of five stars.
It's actually very hard to make compelling
YouTube videos, and it's very to get started,
but it's hard to do well. It's totally worth it,
it's a great skillset, it's really fun. You
get to meet people across the internet. You
get to learn how to talk to a camera and how
to film and video edit. And it's really great,
but it's very hard to actually make money from
YouTube. Finally, in terms of effort to maintain,
like actually getting that first a thousand
subscribers is a lot harder than keeping
it growing. Cause once you've got a thousand
subscribers and once your channel is growing,
it means you've landed on a formula that works.
And so maintaining it then becomes easier than
starting from scratch. And so in our Side Hustle
Assessment Matrix, we're gonna give maintenance of
a YouTube channel passive income stream to be
around about two out of five stars. To use my
example, I made 70 videos before I started making
any money from YouTube AdSense. And these days,
the YouTube channel makes around about $12,000 a
month in passive income from YouTube AdSense. Now,
again, this is not entirely passive,
because I keep on uploading new videos,
but actually, the bulk of the amount
of money that we generate from ads
is from older videos rather than videos that
were uploaded this month. So with that caveat,
$12,000 a month, passive income is around about
$3,000 a week, thanks to this YouTube channel,
and thanks to you guys for supporting it and all
that stuff. There are other ways of monetizing
YouTube, like brand deals, and like selling
merch and this all other sort of stuff. But it
doesn't really count as passive income through
YouTube, which is why I'm not including this
in this Side Hustle Assessment Matrix. Idea number
three for making passive income is to start a
podcast. This is generally easier than starting a
YouTube channel. Although, growing a podcast is a
lot harder than growing a YouTube channel, because
because podcast themselves don't really have a
algorithm that's helping them grow. In fact, a
lot of podcasts grow by having a YouTube channel,
which is kind of weird. So how hard is it to start
a podcast? Well, again, one out of five stars,
it's very, very easy to start a podcast, go on
anchor.fm, and you can literally use your phone,
and you can pass your phone around between you
and your friends, and you can start a podcast.
You can use a website called Riverside.fm that
I've recently invested in as an angel investor.
Riverside makes it very easy to record remote
podcast interviews. It's very, very easy to
start a podcast, but how hard is it to make $100
a month in passive income from a podcast? Well,
again, this is not quite passive income, because
the way podcasters make money is by relying on
brand deals. There is no YouTube ad sense for
podcasts. And so you need a sponsorship or a
brand deal to make any money through your podcast,
generally speaking. And apparently, you can expect
to make around $18 for a 30-second ad in a podcast
and $25 per thousand views or a thousand listens
for a 60-second ad. So if you wanna make
$100 a month, and assuming you have a stream
of sponsorships who are giving you that level of
sponsorship deal based on your download numbers,
you would need around 1,000 downloads per episode,
if you have a weekly podcast. So you would have
4,000 downloads a month. And if you're putting a
60-second ad in there for $25 per thousand views,
that would make you around about $100 a month, by
having a thousand downloads per episode and four
episodes per month. This begs the question, how
hard is it to get a thousand downloads per month?
Well, it's a lot harder to get a thousand
podcast downloads per month than it is to
get a thousand YouTube views per month. Because,
again, YouTube has so much distribution built in,
it's different to podcast. Also, loads of more
people are on YouTube than on podcasts. But
if we look at the stats, then it's the top 20%
of podcasts in the world that get, on average,
more than 1,000 downloads per episode. To use
a friend of mine as an example, my housemate,
Sheen, started her own podcast around five
months ago. There will be a link to that in
the description if you wanna check it out. And on
average, her podcast gets round about 400 to 500
downloads per episode. This is not bad at all,
especially considering she started five months
ago and had zero audience when she started. So she
didn't have the unfair advantage that I did when
starting my own podcast, for example, and because
she's just launched season two of her podcast
and has just started posting videos about it on
YouTube, that will really help the podcast grow.
And I'm pretty sure that in the next six months,
she'll be getting to a point where she can quite
easily make $100 a month from her podcast. So
going back to our Side Hustle Assessment Matrix,
starting a podcast, one outta five stars. Making
$100 a month, I'm gonna give that a three out of
five stars, because it's hard, but not as hard
as maybe monetizing on YouTube, where you have
this minimum threshold. And finally, maintenance.
Well, it's not really passive income, because you
do have to keep on making podcast episodes,
because the brand deals are associated with
that. But again, once you've stumbled on a formula
that works, once you know how to be a podcaster,
it's easier to continue going once you've already
gotten started, as is the case with most things.
And so, in terms of maintenance of the podcast,
I'm gonna give that two stars. To use me as an
example, so me and my brother have a podcast
called "Not Overthinking," link in the video
description if you wanna check it out. But we make
run about $625 per week from the podcast overall,
from brand deals and from our membership. All
right, so idea number four for generating passive
income is to become an affiliate marketer.
Affiliate marketing means that you are selling
other people's products, but you're getting a
percentage of the sales from those products. Now,
apparently, 48% of affiliate marketers globally
earn $20,000 a year, which is $1,660 a month,
which is actually not bad at all, people are
doing very well with affiliate marketing overall.
So how hard is it to get started with affiliate
marketing? Well, I'm gonna give this a two out
of five stars. Basically, you can just sign up to
an affiliate programme like Amazon associates. So
Amazon have their own affiliate programme, which
I think is probably the biggest in the world. And
then, once you have your little special links, you
can post those on your website or on Twitter or on
social media or whatever. And if people buy the
product through your link or, in fact, buy any
product on Amazon through your link, you'll get
like some tiny percentage of the sales. So pretty
easy to get started with affiliate marketing,
but how hard is it to make $100 a month? Oh,
this is actually kind of hard. So, let's say, you
had a product that was $50 that you were trying to
sell, and you were getting 5% commission on it,
that would be pretty good. Amazon doesn't offer
nearly as much as 5%, it offers like two or 3%,
something like that. And let's say your average
conversion rate, i.e., people visiting the thing
versus people actually buying the product after
visiting the thing, let's say that's 1%, which is
pretty reasonable for a conversion rate. You would
need 8,000 visits to your website or whatever to
make $100 a month. It's actually quite hard to get
8,000 visits per month to your website, to your
specific product page, and generally, doing well
in affiliate marketing requires lots of upfront
effort in terms of either building an audience
or building such domain authority in whatever
space you're in that you're sort of organically
getting traffic. Now, other than Amazon, there are
a few other affiliate programmes that I'm part of.
One of them is Skillshare, who are kindly
sponsoring this video. I'll tell you about
the sponsor segment later, but Skillshare
have an interesting affiliate programme,
where if you refer someone to sign up to a
free trial of Skillshare, you can get $7 in
affiliate commission just for that thing. So if
you wanted to make $100 a month from affiliates,
you would need 15 people every month to sign up
for Skillshare with your affiliate link thing.
How hard is it to get 15 people a month to sign up
with your affiliate link? Well, it's not that hard
if you have an audience, and it's not that hard if
you have your own classes on Skillshare like I do,
I have like nine of them. And so, if I wanna make
money through Skillshare affiliates, I can just
tell people, "Hey, guys," I can tell you that,
"Guys, I've just released my latest Skillshare
class, "'Productivity for Creators, "'how to start
a successful side hustle.'" So there'll be a link
in the video description if you wanna check
that out. Hopefully, some of you will see that,
will click on that link in the description, and
then that will be me getting some affiliate income
from Skillshare for this video. So going
back to our Side Hustle Assessment Matrix,
how hard is it to make $100 a month? I'm gonna
give this a 3.5 star rating, because, again,
you need an audience. And as we always talk about
on this channel, the way you build an audience is
by creating useful content, putting it for free
on the internet once a week, and doing this
for at least two years. If you just follow those
three steps, I guarantee you'll have an audience,
and you'll be able to make some kind of money
through this passive income stuff, but that's
quite hard to do, no one sticks to it for at least
two years. So we'll give that a 3.5 star rating.
But the good news is, once you've created it, and
once you've started making money from affiliates,
it's actually quite easy to maintain, because
especially if you have evergreen content,
the sort that isn't relying on current affairs or
the latest news, the sort that people might search
for over a long period of time, this becomes
like relatively reasonable passive income. Now,
if we look at me and my business, these days, from
Skillshare, we make around about $11,000 per month
in affiliate income, which approximates to around
$2,750 per week. And from Amazon, on average, like
it's around about $450 a month from the Amazon
UK store and a little bit more from the US and
Canada. All right, method number five of making
passive income is by selling digital products.
Now, these are products that you create once, like
an ebook or a download or an app or something like
that. You create it once, and then you can sell it
multiple times, because selling digital products
doesn't usually have any cost associated with it.
One really good example is this guy called Traf,
who I follow on Twitter, who made an iOS 14 icon
set and sold it for like $30 a pop, a few months
ago, and ended up making, I think, like $300,000
in the course of like a few weeks, just because
loads of people around the world wanted to buy his
icon pack. So he put the work into creating the
pack, and now he's selling it for lots of money.
Another example is my YouTuber friend, Oliur,
who has made, as he says, $700,000 from selling
his website Tumblr themes since 2014. So he made
the website themes for Tumblr. He sells them,
and he makes $700,000 on average, well, overall,
since 2014, that's pretty cool. So how hard is it
to get started making digital products? I mean,
anyone can write an ebook, an ebook counts as
a digital product. So I'm gonna give this a two
star rating, two outta five stars, but obviously,
again, money is an exchange of value. So the thing
that you're selling, you have to be providing
enough value to compensate, to make up for the
price that you're selling it for. And that's
often quite hard, especially if you don't have
an experience in this sort of field. And
how hard is it to make $100 a month? Well,
it's very easy to create an ebook, but it's a
whole different ball game trying to get people
to actually buy your ebook or buy your icon or buy
your app or buy your website themes. And because
the market around this stuff is so competitive,
you have to be genuinely really good to get people
to buy your stuff. And the way you get people to
pay you money for something is that you identify
a problem that they have, you solve that problem,
and then you charge money for it. And if you can
do those three things, then it's, I wouldn't say
it's easy to make $100 a month, but it's very
doable to make $100 a month. You just genuinely
have to have something that solves a pain point
that other people are willing to pay for. So we're
gonna give this a three outta five stars to make
$100 a month from selling digital products. And
finally, in terms of maintenance, we're gonna give
this a two out of five stars, because usually,
you do have to maintain your product a little bit,
but it's often easier to do, it's much easier to
maintain a product than creating a product in the
first place. Idea number six for passive income
generation is to create an online course. Now,
online course is sort of like a digital product,
but generally, online courses are in video format.
In fact, this whole video is so long, it could
basically have been an entire online course.
Maybe I'll do one about this very topic. And
in terms of getting started, we're gonna give
the starting difficulty a two outta five stars,
'cause it's not that hard make an online course,
but generally, you do need to know how to do
video. So, you actually could film an online
course on your iPhone or phone, whatever phone
you're using, if you're one of those Android,
stick your phone on the side, talk to the phone,
teach something. So it's not hard creating one,
but in terms of making $100 a month, again, at
that point, your course needs to actually be good,
and the only reason people will pay for
it is if the course is actually good.
Now, you can avoid having to charge for your
online courses by using a website like Skillshare,
who are very kindly sponsoring this video.
I have tonnes of classes on Skillshare,
I think we've got nine on them in total. I've
been teaching on Skillshare since September, 2019,
and I've actually just released my new online
class called "Productivity for Creators:
"how to start a successful side hustle," where I
teach you the ins and outs and how you can create
your own side hustle in your spare time, without
quitting your job. If you wanna check this out,
and the first thousand people to click the link in
the video description will get 30% off the annual
Skillshare Premium Membership, this is actually
a really good deal, I pay for Skillshare. I have
been paying for it for years, even after I started
teaching on it, because it's genuinely a fantastic
place to learn stuff. They've got thousands of
classes on all sorts of other topics, but you
should definitely check out mine, like the nine
that I've got. There are three around productivity
now, like the fundamentals of productivity, the
sort of productivity equation, which is how I
think of productivity, and productivity for
creators. I have two on how you can study for
exams. If you're in school, if you've got exams to
prepare for, those, apparently, are really good,
they've got very high ratings. And if you've
already had a free trial of Skillshare, then you
can still use that offer, that if you wanted the
first a thousand people to hit the link and video
description, you will get 30% off the premium
membership, and you can check out my class,
which I have to say is pretty good. Anyway, thank
you Skillshare for sponsoring this video, but
genuinely, Skillshare is a great place to teach
stuff, because you can teach things on Skillshare
without directly having to charge for them, which
is why I love putting my courses on Skillshare.
It's kind of like having something on Netflix, and
that the end user does not have to pay directly
for the product. And the other nice thing about
Skillshare is that, it's sort of like YouTube,
and that anyone can upload a class to Skillshare
provided it meets certain quality requirements.
And so it's a lot easier than having to make your
own website and create your own courses platform
and all that kind of stuff. So, pretty easy to
start. We're gonna give this a two outta five, but
how hard is it to make $100 a month from teaching
online courses? Now, this kind of depends.
If you're going down the Skillshare route,
then to make $100 a month on Skillshare,
you need around about 1,700 minutes of watch
time, which is 28 hours of watch time. So if
you have a one hour-class on Skillshare, you need
28 students to take that class every month and
watch it with a premium membership, roughly,
very broadly speaking. And that will give you
roundabout $100 a month, at least, those are based
on my figures over the last two years of being on
Skillshare. Now, how hard is it to get 28 people
a month watching your class? Well, if your class
is actually pretty good, it shouldn't be too hard
to get 28 people a month watching it. If you have
an existing audience, it's very easy to get 28
people a month watching it, because people already
know, like, and trust you, hopefully. And so
they'll watch your stuff and give you a shot,
because you've already built that goodwill
with them. But again, the nice thing about
Skillshare as a platform is that they have their
own algorithm. So the good stuff rises to the top.
So if you genuinely have a really, really, really
good class and you put it on Skillshare, then even
if you don't have an audience, there is still a
high chance that if the class is actually good
and people watch it a lot and people recommend
it and give it high ratings, it will rise to the
top. And it will start getting recommended to
people who find it on the Skillshare homepage
or who search for it specifically. The other way
of making $100 a month from a course is to just
charge $100 for a course. And then if you do that,
you just need one sale every month. So how hard is
it to get one person a month to buy your course?
Well, again, if it's good, the world of online
education is exploding so much. Every year, more
and more money is being spent on online education,
especially with the whole pandemic stuff. So if
you have a valuable skill that you can teach,
I think courses are one of the best and easiest,
one of the best ways of making passive income,
because it's fun to create a course, you can
teach stuff, you don't need that many technical
skills like making a website or anything
like that. Just shove it on Skillshare,
and then, people can take your course and learn on
the internet. And it's just cool overall. And the
nice thing is that once you've made the course
and once you're making $100 a month from it,
maintaining that level is actually quite easy.
We're gonna give that a two out of five stars,
because generally, you don't need to update the
course that often. And you can do that once in
a while, and you just need to make sure you're
getting a reasonable amount of traffic to it,
and hopefully, that traffic will grow over
time. These days, the vast majority of my online
courses, at least, the very passive ones, are
hosted on Skillshare. And it's kind of ridiculous,
but these days, they make round about 60,000
to $65,000 per month in purely passive income.
I literally do nothing for my Skillshare classes
once I've made them, other than reply to comments
and other than occasionally plug them in videos.
And that's like $60,000 a month in passive income.
That means this is a around about $15,000 per
week, and this makes the bulk of the $27,000
a week that this business currently generates
in purely passive income. Idea number seven for
passive income is by creating some kind of paid
membership or community model. Now, again, this is
generally a bad idea unless you have an existing
audience, which we keep coming back to, everything
becomes easier when you have an existing audience,
by creating content that has been valuable over
a long period of time very consistently, that
audience knows, likes, and trusts you. And so,
when you say, "Hey, guys, sign up to my Patreon,"
then some people are likely to do that thing. The
other way of doing a membership is by creating
a value proposition that is so compelling that
people will be willing to pay for a community-like
service for this. If we use Patreon as an example,
my friend, Hannah Witton, who's a YouTuber, she's
got round about 600,000 subscribers in YouTube.
And I think she has around 600 patrons, 626,
last time I checked, which means, if we look at
her Patreon stats, which are public, she's making
somewhere between 2,000 and 5,000 pounds or like
$3,000 and $7,000 per month in passive income from
this audience. But it's like 600 people out of an
audience of 600,000. So one in a thousand of
her subscribers have signed up to her Patreon.
So clearly, if those stats are true across
the board, and they kind of are, if you look
at Patreon as well, you need a big audience to
make a significant amount of money for Patreon.
Again, this sort of depends on how much you're
charging for them and exactly what value you're
providing. Another example of a paid membership
community is my friend, Anne-Laure, who runs a
website called Ness Labs. And they have a paid
membership community, which is $5 a month. And
she started this in summer of 2019, she had zero
audience at the time, and she just wrote a hundred
blog posts over a hundred working days and built
up an audience, such that in March 2020, when she
launched a membership, she had some paying members
for it initially. And I think last month, she's
just passed $100,000 a year in annual recurring
revenue, which is pretty awesome from something
that started less than two years ago. So how easy
is it to start a membership programme? Well, it's
actually very easy. We can give this a one star,
because it's very easy to start one. You just make
an account on some kind of membership platform
like Patreon, but to make $100 a month, you need
to provide $100 a month worth of value, and that's
actually quite hard to do. We're gonna give that
a four out of five stars, but the nice thing is,
again, once you've got that formula, once you're
making $100 a month, it's actually a lot easier
to maintain it, because the way the economics of
membership communities work is provided you keep
showing up and providing value in some capacity,
people have already signed up for the thing.
So it's not too hard to maintain that level
of support that you're offering them, For this
business, we have a membership community for our
part-time YouTuber academy for the alumni, which
is called "The Part-Time YouTuber Inner Circle,"
and we make roughly $2,800 a week from this
membership community, it's not very passive.
We run like three or four events per week along
with twice a day co-working events on Zoom. And
we have lots of stuff going on. So it takes a lot
of work, but $2,800 a week is pretty good for a
membership community. All right, nearly there. So
idea number eight for generating passive income is
creating a business that sells goods or services,
and then automating or delegating aspect of that
business so that the income that you generate
from it is reasonably passive. This is the stuff
that Tim Ferris talks a lot about in the "4-Hour
Workweek," where there are a lot of businesses
that you could make, where you're selling a good
or selling a service, and then, you can delegate,
outsource, automate, and intelligent ways to make
the income passive. So again, using my friend
Oliur as an example, on his YouTube channel,
he talks about his $1 million Shopify store.
He designs, manufactures, and sells these really
cool vegan leather, kind of desk accessories and
bags and mouse pads and that kind of stuff. And
this was loads of work in setting up, but now,
he's got a team of three other people that manage
the business. And so, he spends proportionally
less of his time running that business. And so,
it's sort of passive income for him, even though
these days, he still does spend around 10 hours a
week maintaining things. Equally, if you're going
down the service routes, I've got a friend who
runs Instagram and Facebook ads marketing agency,
where he has clients who pay him some, I think,
a few hundred dollars per month, to manage their
Facebook and Instagram ads. And for him, it's
like a small amount of work initially to set
up the Facebook and Instagram ads, but then, it's
sort of automated, and he is got a team around it,
and he's using things like Zapier to automate
aspects of that business, so that, each month,
he has to do a very small amount of actual work to
keep it ticking along. So these are different ways
of generating passive income from a kind of goods
or service-based business. But it's quite hard to
get started with this stuff. To get started, we're
gonna give this a four outta five star rating,
because again, you need to create a business, and
it's quite hard to make a business that genuinely
provides value. Equally, we're gonna give it
a four outta five star rating for making $100
a month in revenue, because, again, you have to
be able to provide value, and providing value is
hard, it's not as easy as making an account on
a stocks platform, just putting some money in.
You actually have to give value to people, which
is kind of hard. But the nice thing is, once you
get started, like with anything, maintenance is
a little bit easier. So we're gonna give that
a three out of five star rating. Finally, idea
number nine for generating passive income is to
build an app or a website or some kind of software
product that you can offer either as a one off or,
more likely these days, as a subscription service.
And there's a whole category of this called SAS,
software as a service. Now, if you
look at the website indiehackers.com,
there are literally hundreds of examples of people
who have built software businesses that are making
passive income, and they share their revenue
numbers, and they tell you how they got started,
and they give you their tips. In fact, I was
recently interviewed on an episode of the Indie
Hackers podcast, which is really cool, 'cause I've
been listening to it for years and following the
website for years. And I was interviewed around
the concept of starting an online course, like
the "Part-Time YouTuber Academy." Now, I've had
a bit of personal experience with this. So when
I was at university, I made a website called BMAT
Ninja and UKCAT Ninja. So, software as a service,
it was a question bank for medical applicants
applying to medical school to help him do well in
the admissions tests. And this was something that
me and my brother coded completely from scratch.
He and I both know how to code. We learned when
we were young. And so, we worked over the summer
of 2015 to make these things happen. I think, in
year one, we made about $10,000, and in year five,
last year, it was around $25,000 from BMAT Ninja.
So, it's pretty good money, but it was a lot of
work to set these things up. And so, in terms of
starting out, I'm gonna give this a five outta
five rating, because to make an app it's actually
quite hard. You have to know how to code, for the
most part, you have to be able to offer something
compelling, and you have to actually build it,
which takes a lot of work and is very hard, but
it's a lot of fun. And then once you've made it,
I'm gonna give $100 a month difficulty a four
star rating, because, again, it's easy, well,
easy enough, you can make an app, but
then, getting people to pay for the app
is an entirely different cuddle of fish. So we're
gonna give that four stars. But the nice thing is,
like with everything, maintenance is a little
bit easier, so we're gonna give that a three-star
rating. If you like this video and you wanna get
started with your own entrepreneurshipy, passive
incomey generating journey on the internet, check
out this short playlist over here, which is some
of my favourite videos that I've made, around tips
for entrepreneurs, how I got started creating my
businesses from scratch, how I learned to code,
that sort of stuff. That's all in the playlist
over here. Thank you so much for watching,
and I'll see you in the next video, bye bye.
Please play the YouTube video first