Fellow blogger Richard Lee linked to a very thought provoking and quite controversial video from 45n5.com which claims there’s no such thing as passive income.
I don;t agree with it entirely, (I explain why below), but it did make me reconsider my use of the phrase ‘passive income’ when I talk about creating and selling information products.
I’m actually referring to scalable income.
Creating and selling information products allows you to add an extra stream of income which is totally scalable — in other words not dependent on the number of employees or hours in the day.
If you run a service company, and only ‘sell time’ at the moment, I seriously recommend you check out information products — they’re a great way of adding easily scalable income. (I spent more than a decade (1996 – 2006) selling my own and my employee’s time… I only wish I’d started selling products sooner).
However, here’s the critical point. Income earned from information products is very unlikely to be 100% passive.
To be truly passive would require you to be totally removed from the ongoing marketing, fulfillment, support and financial administration/accounting of each product sale.
Of course all of those activities can be totally delegated or ousourced, but — personally — I’d still want to oversee the operation, even if just to review ongoing performance.
(Which is why in Stats Faceslap! I show how to delegate the weekly collation of stats into a dashboard — but I still recommend it’s the business owner/manager who reviews those stats each week.)
My final comment about the ‘passive income is a myth’ video is that I DO think passive income exists, and although it’s not as easy as many people make out, it’s a worth heading towards that as a goal as much as possible.
Sidenote: The other thing about this video — it confirmed how ‘hard line opinion’ (aka controversy) creates a lot of web site traffic!
Look at that post and see how many people left comments. This site gets something like 30,000 visitors a month, and I’ve no doubt that controversial posts like this one bring a lot of that traffic.
The only quasi-controversial subject I talk about on this blog is that I advise most small business owners to more or less forget about search engine optimisation (or at least not make it their only focus after launching a new site).
(Not exactly controversial, but still quite unusual for someone involved in web marketing.)
What’s your controversy?
-Ed.
P.S. To everyone who bought Stats Faceslap! yesterday – the 2 disc DVD set will be shipping next week. You should also have been given automatic access to the online resources area with bonus video and extra downloads — if you didn’t get that, open a new support ticket at my customer support web site and I’ll make sure you get access to that.
