#037: The Hard Truth About Passive Income: How to Find and Develop a Profitable (and Realistic!) Sideline Business

I come across a lot of writers who love the idea of developing passive income streams.

Problem is, they just don’t know where to start!

It’s not surprising. The world of Internet marketing is filled with hucksters promising overnight riches.

Then there’s the multitude of technology and product options. The “you gotta do this” and “you HAVE to do that.”

It’s overwhelming!

That’s why I recently reached out to one of the truly great guys in this business of internet marketing: Mark Mason of the Late Night Internet Marketing podcast.

And in this episode, Mark talks about the best opportunities to develop realistic and viable passive income streams … how “passive” is passive … where to look for opportunities … how to better determine if there’s a strong demand for your idea … and much more!
The notes that follow are a very basic, unedited summary of the show. There’s a lot more detail in the audio version. You can listen to the show using the audio player below. Or you can subscribe in iTunes or on Stitcher to get this show delivered straight to the Podcasts app on your smart phone, tablet or iPod.

Are there still opportunities to develop realistic and viable passive income streams?

Absolutely, yes. The techniques and methods change, but online business is growing.

There aren’t many novel ideas left. When you’re looking for an idea, it’s better to get into something where people are already making money. That’s market validation.

How “passive” is passive, really?

It depends on the business model.

At the very least, you have to do the work to build the asset that will generate the income. You may be able to create a business that pretty much runs itself, but in order to get to that point, you have to do the work. And sometimes it’s a LOT of work.

What is a realistic expectation for the time required and time to profitability?

Again, it depends on the business model. Sometimes you can bring your costs down with sweat equity. Maybe you can build your own website in WordPress and write your own copy.

The fastest Mark has seen a site turn a profit is a few months. Usually it takes six months to a year before you see a profit.

But it will depend largely on your skills and the market you’ve chosen.

Where do you start?

Start by deciding on a business model.

Two of the most popular models:

  • Leverage content to place and sell ads, usually using Google’s AdSense.
  • Affiliate marketing. You create a website around a product topic. On the website you advertise or recommend products. If people buy the product, you get a percentage of the sale.

Mark recommends these business models because they require almost no capital investment. Because you’re not selling a physical product, you don’t have to worry about creating the product or fulfilling orders, so these models are lower risk. You’re mostly risking your time.

An example of this type of website:

To try out a new Internet marketing software, Mark created a website with content about corn shellers. He monetized the site with affiliate listings of eBay products. If people buy a corn sheller listed on his site, he makes a commission. The site took him a few weeks to build. For the last year and a half, it has generated about $30-50 per month.

Do you recommend updating the site with fresh content, such as a blog, to keep it high in search results?

Mark has no real interest in corn shellers, so he hasn’t. But normally he would.

Mark recommends that people choose a topic they’re interested in, especially if they’re doing it on the side. They need to want to work on it during the evenings.

Your motivation should be to create value for the readers you’re trying to attract. Not only will it help with Google search results, but it will also get you a better end result. Google is only getting smarter, so it makes sense to put up quality content now.

How do you separate good ideas from bad?

Go to Google, type in your idea and see if there are paid advertisements for products related to that idea. If people are spending money in Google, then that usually means there’s money to be made.

Look in places like Commission Junction, Share a Sale or other clearing houses for affiliate products. Take a look at ClickBank. You can find out how well products are converting; how much people are earning.

How important is niching? How narrow should your topic be?

How much you should niche depends on the level of competition. For example, “brewing beer” vs. “brewing Indian pale ale with a high alcohol content.”

Look for a combination of:

  • Attainable high ranking, and
  • Enough people in the market to make it worthwhile.

If the topic’s too broad, it’s difficult to compete. If the topic’s too narrow, no one is searching for it.

You need to match your message to your market. As writers, you know how to capture attention and write headlines. You have a huge advantage in this area.

How do you find the time to do this when you have a day job?

Mark thinks it’s less a matter of “I don’t have the time” than “I’m not willing to make it a priority.”

If you decide to take this on, work on it EVERY day—even if it’s only for five minutes. It keeps your business top of mind. Also, over a few months or a year, you’ll accomplish something significant.

On days when you don’t feel like doing anything, you still should do SOMETHING—even if it’s not a top priority.

Is it better start with one project at a time? Or can you develop several to see which bear fruit?

If it’s truly a sideline to a full-time job, most people won’t succeed doing two or three things at once. Focus on one thing for a while and see where it goes before moving on to something else.

Where can listeners learn more about you?

Mark’s websites:


Facebook fan page:

Mark tries to answer every question people post on his Facebook wall.

Mark also recently did a two-part podcast on getting started in affiliate marketing with Cliff Ravenscraft. Ed strongly recommends this two-part series, which you can find here:

Want More of This Stuff?

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Thanks again for your support!

Till next time,