Hobbies to Business: How to get it off the Ground
According to a 2017 US Bureau of Labor Statistics survey, the average American spends between 4.5 and 5.5 hours doing leisure activities which you can divide into two, namely hobbies and pastimes. However, you usually don’t get paid to do whatever hobby floats your boat – though you can change that by transforming it into a business.
A 2015 Elite Daily article pointed out those pastimes are only for whiling your time away, while hobbies are any leisure activities you have a genuine interest in pursuing.
So how can you get your hobby-turned-business off the ground? Here are a few steps to consider:
1. Research if there’s an income-generating potential if you turn your hobby into a business.
Always consider the business model. Regardless of how awesome you think your hobby is, it’s safe to say that not everyone might share your enthusiasm. Consider how terrible it would be if you decided to convert your hobby into a business and you don’t have enough buying customers. For instance, you may find joy in pursuing cross stitching as a hobby. However, if you decide to sell some of your cross-stitched pieces as a business, you may not see enough money coming your way as there might not be much of a demand for them, not to mention that you can’t do a quick mass production on your items. Before you consider turning your hobby into a business, validate if people would buy from you and if you can find ways to produce your work on a larger scale in case demand for them starts to grow.
2. Keep your day job until you’ve turned a stable and sufficient profit.
A rookie mistake some fledgling entrepreneurs make when converting their passion into profit is resigning from their desk job even before they launch their hobby-turned-business. Unfortunately for them, hindsight is 20/20 as they experience failure after failure while trying their hand at becoming self-employed and eventually realize that they probably should’ve held onto their cushy office job instead.
To avoid the same lapse in judgment from happening to you as well, don’t resign from your day job just yet. You can take care of it after office hours and on weekends when you aren’t running on company time. Once your business has generated a steady flow of income, you can file your resignation letter so that you can manage your venture full-time.
3. Consider hiring a financial planner to help you sort your finances out.
As mentioned earlier, you usually don’t expect to get paid for pursuing whatever hobby piques your interest. However, once you transform it into a business, you may be incapable of resisting the temptation to splurge on luxuries that have nothing to do with your chosen hobby. While it’s nice to treat yourself from time to time, especially after your hobby has successfully turned into a business, you might eventually start racking up too much debt that most – if not all – of your earnings would go only to repaying it.
So if you lack self-control when it comes to handling any money that your business generates, you should hire an advisor who works for a financial firm like Capstone to steer you towards keeping your finances straight so you can enjoy the fruits of turning your passion into profit.
4. Promote your hobby-turned-business on social media.
Almost everyone has at least one social media profile, so it would be a missed opportunity if you don’t take advantage of the free networking platforms available online. A massive number of your potential customers are most likely on social media, so even if you don’t have an account yourself, you should open one for your venture.
Just make sure to identify first which social media platform most of your target customers use often. In general, Facebook is a given since it’s currently the leading social media platform of choice for most people and businesses. For example, you turned your hobby of baking cupcakes into a business. You’ll more likely see most of your potential customers on Instagram instead of Twitter, especially if they like to share photos of baked cupcakes with captivating designs online. Since your hobby requires the usage of beautiful photos, you should set up an Instagram account for your cupcake business.
As with any other business, you need to encourage people to buy from you; otherwise, your hobby will stagnate even if you already turned it into a business endeavor.
5. Register your business.
Once you successfully convert your hobby into a business, you have to register it either as a sole proprietorship or an LLC which stands for limited liability Company.
If you plan to have full control of your business, then register it as a sole proprietorship – though in case you have to borrow capital to get it off the ground, your debtors can seize any of your assets and sell them via public auction so that they can get back any money that you owe them. On the other hand, they can’t touch your assets if you register your business as an LLC, and you can even hire other fellow hobbyists like you to manage it instead of trying to run it on your own which can be physically and mentally demanding.
You might already know by now who Mark Zuckerberg is – especially if you often log in to your Facebook account. Zuckerberg started Facebook as a hobby which eventually became the multibillion-dollar social media platform that it is today. Like him, you can turn whatever hobby you have right now into something that pays the bills by doing the things listed above. After all, why confine your hobby into a leisurely pursuit if you can turn it into a business that can bring you both pleasure and profit?