This post originally appeared on Entrepreneur.com - #Growing Your Business
As with anything, no entrepreneur should put all their income-generating eggs in one basket.
4 min read
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The quickest route to becoming an entrepreneurial millionaire is not necessarily by making one product with a high-profit margin that flies off the shelves. WYou ideally should have multiple revenue streams in order to truly accumulate wealth.
Em Ducharme, founder of Zero to CEO, first started diversifying her income streams to cover various expenses. “I was able to be debt-free, able to save and invest in new income streams that were scalable and sustainable,” she explains. “Having multiple income streams removed the stress related to paying bills,and allowed me to focus on building longer-term avenues.”
In addition to making sure ancillary costs in your life or in your business expenses are covered, multiple revenue streams also work together to grow your bank account — once you start to build them out. Here are four ways to build multiple revenue streams for your business.
1. Take stock of how much you can monetize.
Creating multiple revenue streams doesn’t necessarily mean you’re going to start several more mini-businesses. A good first step is to simply consider how much of what you do on a daily basis or how much you have can be monetized. Jamie King, otherwise known as The Slay Coach, recommends going through your day’s activities with brainstorming questions such as, “How can this serve others?” or, “How can I repurpose?”
“You could open yourself up to a ton of ideas on how to bring in an income,” King shares. “Got an extra room in your house? List it on Airbnb. Got old tutorial videos lying around? Bundle them and sell them as a course.” T
ake stock of each resource you have to offer, consider how a consumer may benefit, and build a business plan around it.
2. Aim to create at least seven streams.
While you’re in the building process, think bigger. It’s great to have more than one revenue stream, but it’s better to have, well, seven. Jenna Kutcher, influencer and the founder of the Goal Digger podcast, shared that she once read that the average millionaire has seven revenue streams. “So, I spend a year building eight,” she remarks.
As you’re continuing to aim for seven (or meet Kutcher on her level and build eight), she recommends building resources and blueprints that can really help your customers. In other words, continue to diversify product offerings. You know more than you think you do, so think through how you can share your expertise within courses or informational packets that can be purchased and downloaded online.
3. Remember that passive or residual income is also a revenue stream.
Not all of your revenue streams have to be products or services that you’re continuing to churn out. There are many passive or residual revenue streams that can continue to accumulate money on the side while you’re building or focusing on your main business. Roland Frasier, the founder of the WarRoom Mastermind, recommends building these passive streams by adding in different categories of income.
“There are plenty of examples, but consider adding income streams such as from royalty income, in which you own intellectual property for books and music,” he recommends. “Or dividend income, in which you own stocks or interests in businesses that pay you a percentage of their excess profits.
Most of the work on these income streams is done upfront, and then they’ll work for you in the background.
4. Make sure at least one income source is fully in your control.
As you continue to diversify, Chris Harder, the creator of the For the Love of Money podcast, urges you to keep at least one income source fully within your own control. “In other words, make sure you’re not relying on someone else’s performance of products in order to thrive,” he shares.
It’s easy to build up residual streams, but making sure that there’s one source that’s your real money maker and dependent on your own resources and talents will keep you in control of your own wealth.
Employing these strategies can at least help you think through the ways in which your revenue streams can multiple within the year. And, the more revenue streams, the more revenue. Happy building.