4 Reasons A Service-Based Business Is Better Than Chasing Passive Income

4 Reasons A Service-Based Business Is Better Than Chasing Passive Income

Starting a blog opened up many money-making opportunities for me and my family. Learn how to start a profitable blog the RIGHT WAY.


After 2 phenomenal guest posts this year, this is the first post I am writing this year & I am especially pumped to write today.

When I started this blog, my purpose was to write about creating and selling Udemy courses and Amazon Kindle books.

Both of these are viable business models and no doubt there are those who have had mighty success doing both or one of these.

So, before all you passive income pullers take my words out of context and start your “burn her at the stake” chant, let me clarify my position.

I am not arguing against passive income at all. I love passive income. I make some passive income. Not much. But still passive.

I’m just tired of the seeing folks get frustrated with themselves because nobody is clicking on their affiliate links or buying their course and all we can offer them are platitudes & irrelevant advice.

I am simply presenting another view of “making money online/making money from home” that I think sometimes gets lost when people see income reports of major players in the online world.

This post is my way of saying that while passive income is possible, there are other ways of making meaningful job-free income in the mean time.

Why A Service-Based Business Is Better Than Passive Income (FOR NOW)


1)Without an audience, making money passively can be an uphill battle

There are several reasons why some people clear $20,000 in Bluehost affiliate income and some don’t. In the interest of time, we will not go into all of the varied reasons but a major reason I want to point out is this : unless you have a huge existing audience to sell to making money passively can be a frustrating uphill battle.

Not impossible. But incredibly difficult.

When Teachable held their online summit late last year, I heard a statistic of how many people on an e-mail list typically purchase a course during a launch.

The agreed upon conversion rate is 2-3%.

I have seen that rate over and over again even from some of the most successful online income pullers.

I have tested it myself and found it true.

Consistently, even with the very best copy I can whip up my conversion rates stay around the 3% mark.

And so hypothetically, let’s say we have a $97 info product. Having a list of 100 people means, you will make around $300 before you take out your expenses.

200 = $600

400 = $1200

1000 = $3000 and so on.

It is all about the math.

Fact : Unless you have access to an existing audience usually in the form of an e-mail list (yours or you could do a joint venture someone with a big enough list) you are not going to make much selling that $97 info product.

The money is in the list (or in some cases many lists). ‘Tis true, my friend.

Even with platforms like Udemy, Kindle or Etsy, you still need to have someone to tell that you have created a new course, written a new book or created a new item.

However you twist it, you cannot sell unless you have an audience interested in buying.

This is exactly what drew me to packaging my knowledge and offering a service as a great way to start making job-free income.

Key Lesson Here : Be patient with yourself. If you are a boot-strapper like I was at the beginning of my journey, your audience WILL grow as you stay consistent and persistent. Some people have sped the process up with advertising through Facebook, Youtube and the like. This is wonderful if you can do this but if you can’t just yet build slowly and use income from your services to fund these ways of growing your audience when the time comes.

2) Low startup costs

You need nothing to start a service-based business.

Okay I lie. You might need to have a way to showcase your skills.

If you want to offer writing services, start creating a portfolio of your work – that could be your blog.

If you want to manage social media for businesses, build up your own social media channels to an admirable point.

You’re a web designer ? Find one or two people you can design something for free apart from your own website.

The major thing you need with this kind of business is proof that you can do what you say you can do. No expensive business cards. No need for expensive and slightly useless newspaper ads.

Proof that you can provide the service you say you can offer is the most important thing here and it costs you close to nothing.



3) A great source of income that you can feed back into your business

Your job income not enough to buy those tools you need to advance your blog ? Offer a service !

Like I mentioned in this post, I started actively taking on clients for my Social Media Management and Content Creation business in November of last year. I however have not totally abandoned my dreams of building the passive income side of things.

So I am feeding a percentage of the extra money I now make from my service-based business into this blog. One of the most significant things I have invested in has been Facebook ads and so far it has been totally worth it.



4) It is possible to still make a full time income from a service-based business + live life on your terms

That’s why we’re all in this, isn’t it ?  To be able to make money that is not tied to a particular job and live life on our terms ?

Who said you cannot do that with a service-based biz ?

Unfortunately, a lot of people enter into the blogging world thinking that the only way to make money online is through Adsense. Recently, online courses & e-Books are kind of becoming the new Adsense.

Once again, not knocking these business models but you can still sip orange juice from a fancy cup with an umbrella on the beaches of Fiji and do it because of a service-based business.

Just saying.

BONUS TIP : Starting a blog is a great way to showcase your work when start out a freelancer/service-based provider.

Learn how to start one in the next 3 minutes.

Wrapping It Up

Here’s what I want you to do today.

  1. Take an honest inventory of where you are in terms of building an audience – blog traffic, social media following and finally your e-mail list. Are these numbers large enough to support a meaningful income for your blog passively?
  2. What services can you offer ? Think of skills you have acquired in and outside of your education.
  3. How can you package those skills and offer those as a service ?
  4. Listen to your friends and co-workers, what are some of the things they complain about that you could solve for them with a service ?
  5. Go on Craigslist look at the kinds of problems people are looking for help with : babysitting, social media work, writing, etc.
  6. Create a service and post it to Craigslist. Re-post once a month every month and switch up the wording.
  7. Reach out to people who are looking for someone who can help them with a particular problem and pitch yourself to them – they are already looking and so the likelihood of getting hired especially if you have built some kind of portfolio is actually quite high.


What are your thoughts on this ? Let me hear it in the comments.