How I Found Success as a Part-time Entrepreneur
Updated: May 8, 2021
It used to be the case that you had to choose between being an entrepreneur or an employee working a 9–5 job. With the rise of the digital economy, you no longer have to choose one or the other; you can become a part-time entrepreneur.
Starting a part-time digital business has three benefits. The first is that it is entirely flexible; you choose when you work and what you work on. Second, it provides you scalable income, which is the perfect complement to your fixed-income from your day job. Third, it allows you to see if you are cut out for a full-time entrepreneur.
In this article, I will review why a part-time digital business has been the perfect complement to my 9–5 job and how I plan on using the profits from my business to achieve financial Independence.
The importance of flexibility in a part-time business
If you are working a day job, either full or part-time and have a part-time business, you will need to be efficient and flexible with your time. I recently polled my readers on this issue, and I asked them what is more important when it comes to side hustles:
Flexibility to work when, where and how they want
Earning the most amount of money per hour worked.
79% of people said that they value flexibility more than money when it comes to taking on a side hustle.
Whether it be selling digital products, blogging, or e-commerce, a digital business provides fantastic flexibility and freedom of choice of when, where, and how you work.
I have a digital business where I can put in work when it fits in my schedule. Whether it be before work, late at night, or on the weekends, I cam pick up right where I left off.
I should note this extreme level of flexibility does not hold true with all digital businesses. If you are a freelancer dealing with clients and deadlines or have a business with a lot of customer service, you will have less flexibility than I do as a writer and course creator.
A digital business offers scalable income
The real beauty in starting a part-time online business is that it provides you a lot of upside to your income that you simply can’t get working an hourly wage or even a salary.
If you run any business, including a digital business, your income is “scalable.”
Here is a simple definition of scalable income: “You aren’t guaranteed to make a cent, but there is also no limit on what you could potentially earn.”
What I do with the profits from my part-time business
One of the reasons so many people struggle to save money is because they have a tendency to spend based on their paycheck and only save and invest if there is any money left over after the bought everything they wanted.
There are ways people with one paycheck can increase their savings, like automating their savings and then spending what is left.
However, it is much easier for most people from a psychological perspective to save money they earn from a side hustle or second job.
Since the money I earn from my part-time business is independent of the paycheck I receive from my 9–5 job, and since the income I earn from my day job covers all of my living expenses, I reinvest every penny I earn from my part-time business. However, I don’t reinvest it into the business. I reinvest it in myself.
All of the profits my side business generates goes directly into an investment account.
This provides me with both scalable income and scalable wealth.
As I grow my side business, that means I will have more money to invest.
Each year I invest more than I did the year before.
At the same time, the investment gains from previous years begin to compound.
That is how I plan on quickly snowball my wealth and, along with it, strengthen the financial security for myself and my family.
If my business continues so scale at the rate it has in the past 12 months, I have put myself on pace to become financially independent within the next four years.
Financial Independence is the ultimate form of financial freedom. It is the point where I could lose my job, and it would have no material impact on my family’s lifestyle. If you can paint a better picture of financial security, I would love to see it.
The scalability of part-time digital business is what excites me the most because it provides me the fastest route to Financial Independence.
A part-time business allows you to give entrepreneurship a test run
Many of you might be wondering why I haven’t just dove straight into being a full-time entrepreneur?
The simple answer is that one of my greatest fears is not having a reliable income.
It is a well-known fact that the majority of businesses fail. The scalable income that a business provides works both ways;
It can scale up.
It can scale down, potentially to zero.
I am thrilled with where my side-business is as a secondary source of income. However, it is not at the point where it matches my income from my 9–5 job. Even if it was, there is the potential that my income could begin scaling back down.
If my business failed while I have my 9–5 paycheck, I would be disappointed but would be completely fine financially.
If my business failed and was the only source of income I had, I would be pulling my hair out.
Full-time entrepreneurship is a gamble and not one I am willing to take at this moment.
Financial Independence, Retire to entrepreneurship
For the next few years, I am perfectly content growing my business in my spare time and building my wealth snowball. Once my wealth snowball has gotten big enough, I will have reached Financial Independence.
You may have heard of the Financial Independence, Retire Early (FIRE) movement. Which, in principle, I am a big fan of.
However, I like to rewrite the “E” in FIRE and phrase it as “Financial Independence, Retire to Entrepreneurship.”
We like to think of entrepreneurs as fearless risk-takers when a lot of the time, they simply come from a wealthy family and have never had to worry about money.
I don’t come from a wealthy family, and I do have to worry about money, so at this moment, the responsible thing for me to do is remain a part-time entrepreneur. I may not be completely fearless, but I am not afraid to put in the work over a long period of time to make these financial dreams become a reality.
So, for now, I will continue to work at scaling up my side-business and continue to embrace the lessons I have learned from becoming a part-time entrepreneur.
I’d love to hear from you. Have you ever thought of starting a part-time digital business? Are there any ideas you have that you haven’t followed through on? Let me know in the comments.
This article is for informational and entertainment purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any significant financial decisions. Originally published at Benlefort.com.