Making a full-time business of your consulting side hustle
Have you run a successful side-hustle as a consultant – either a tax practitioner, copywriter, web designer or fitness instructor – for a while now? Do you feel ready to leave traditional nine-to-five employment and join the ranks of South Africa’s freelancers and self-employed?
If so, prepare yourself by reviewing this list of things to do as you take the leap into full-time entrepreneurship.
- Build a network
- Establish marketing platforms
- Create systems and processes
- Secure recurring revenue
- Create cash reserves
- Cut expenses
- Find a mastermind
- Figure out the right time
Let’s explore each of these steps in-depth.
1. Build a network
No one can hire you, buy from you, learn from you, or refer business to you if they don’t know you exist. With that in mind, you need as many people as possible to know, like and trust you. You also need your network to have clarity about who you serve, what you do, what results you help people achieve, and how you’re different so they can refer new business to you.
- Join online networking groups such as LinkedIn Groups.
- Join regional or national networking organisations with seminars, conferences and workshops.
- Attend networking events regularly and begin building quality relationships.
Investing in networking means investing in your own network and brand awareness. When you’re finally ready to level up your side hustle and turn it into a full-time business, you’ll have a strong network of supporters in place – one you can tap for referrals.
2. Establish marketing platforms
Take your side hustle seriously and establish your marketing platforms as early as possible:
- Create your website and begin blogging to establish your expert positioning.
- Begin building your email list with an email opt-in.
- Set up your social media accounts, complete the profiles, and begin posting content.
Build your marketing platforms early. You’ll have a powerful digital presence and expansive brand reach that will support your new business when you’re finally ready to take your side hustle full-time.
3. Create systems and processes
While you still have your traditional job paying your bills, set aside time to create systems and processes for everything you can in your side business. This includes scheduling meetings and appointments, accounting and project management.
Systems and processes, especially those you can automate or eventually delegate to a virtual assistant, will reduce stress, improve productivity and increase profitability.
There are many software options available to help streamline, simplify and automate parts of your business. You must have software for:
- Accounting and invoicing
- Project management
- Email marketing
- Time tracking
But be careful – don’t get too caught up in unnecessary expenses too early in your business. Remember, making money – enough to cover all your bills and income – is just as much about controlling expenses as it is about making sales.
4. Secure recurring revenue
With recurring revenue, you have reliable monthly income that you can depend on month after month. Recurring revenue provides a baseline of income. Shoot for 50 percent of your side hustle income (and eventually your business income) being generated from recurring revenue.
Aim to sell your service as ‘subscription’, allowing clients to buy blocks of your time or specific business outcomes, or secure long-term retainer clients to serve as the bedrock of your business.
5. Create cash reserves
To make money, you need to spend money. This means turning your side hustle into a full-time business will require cash. You’ll also need a cash cushion in the bank to cover any unexpected expenses and business slow-downs. Saving three to six months of living expenses will help ease the transition, reduce stress and worry, and make sure your family is taken care of.
Figure out exactly how much money you need to live and what your freelance hourly rate must be. Once you know this number, create a plan to save three to six months of complete living expenses for when you leave your job.
The easiest way to quickly save the amount you need is to begin living off only the income generated by your side hustle. You’re going to lose your full-time income when you quit your job anyway. This is a true test to see if your side hustle is ready to become a full-time business.
6. Cut expenses
If you’re at the point where your side hustle is so successful, you’re considering quitting your job to pursue it full time, it means you’re enjoying both your full-time salary and your side hustle income. While the money is probably great, quitting your job means losing your full-time income and the benefits that come with it.
To help make the transition from side hustle to full-time business easier and reduce the pressure to make sales, you may need to trim some expenses. For example, you might decide to cut the DStv subscription, gym memberships and expensive meals out to alleviate short-term financial pressure.
You may find you can live happily without the luxuries, or you can reintroduce them into your life when you’re on a sure financial footing. The call is yours – for some of us, the dream is to work fewer hours and spend more time at the beach; for others, self-employment is an opportunity to boost earning power.
7. Find mentors and peers
Freelancing or solo consulting can be lonely. As you begin to plan your exit from corporate South Africa and your day job, you need to surround yourself with like-minded people who are in the process of, or have already made the transition from, side hustler to full-time business owner. Network with a group of like-minded people travelling similar paths that provide peer-to-peer mentoring and support.
Each person benefits from the collective intelligence of the group and gains feedback, input, advice and fresh perspectives from group members to solve problems, address challenges and achieve goals. This could be something as formal as a mastermind group or membership of an industry association, or something as relaxed as regular beer and pizza sessions with fellow hustlers you know and like.
8. Pick the right time
Don’t be the person who lands a few clients, gets excited, quits their job with nothing more than a hope and a prayer, and then struggles to make ends meet. At the same time, it’s never going to be the perfect time to quit your job and pursue self-employment and entrepreneurship. Waiting for the right time can mean never making the leap.
You need to take it slow, prove your repeatable success and create a plan. To figure out the right time to take your side hustle full-time, set specific milestones that need to be met to make a successful transition possible.
Your milestones could include things like:
- Securing a certain number of clients.
- Reaching a specific amount of recurring revenue.
- Booking an exact number of long-term retainer hours per month.
- Earning consistent income at a minimum of X rand per month for a certain number of months.
- Living successfully within a reduced budget for a specific number of months.
- Reaching a certain level of cash savings.
When the milestones are met, you’ll know it’s time to take the next step with your side hustle.
A new chapter
You’re on the brink of an exciting new chapter in your life. While it can be scary at times, with the proper planning, you’ll be able to make the transition with minimal impact on your life. Just remember to take it one step at a time.
Get used to living on a tighter budget. Reduce your expenses and create a financial cushion of three to six months’ worth of expenses. Also, set very clear milestones that, when reached, move you closer to saying goodbye to your nine-to-five and hello to business ownership.
This article has been adapted from an original piece by Jennifer Bourn.
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