You have a side project that you’re passionate about and want to turn it into a successful side business?
Good news! With the right strategies, it’s possible to launch a successful business while still maintaining your day job.
In this article, we’ll share 11 tips for turning your side project into a successful side business.
We’ll cover everything from developing a business plan, estimating costs to marketing your business, and avoiding burnout. We’ll also discuss how to measure success for your side project and the risks associated with launching a new business.
Whether you’re a freelance artist, a software developer, or an aspiring entrepreneur, these tips will help you transform your side project into a profitable and fulfilling full-time gig.
1. Define the vision of your side project
Before you can launch your new business, you’ll need to:
- define how many hours you are willing to involve in this side project
- define what it is you will offer through your project
- identify who your target audience is.
It is not mandatory, but if it can reassure you before you start, develop a business plan that outlines your goals, objectives, products/services, marketing strategy, and financial projections.
For this first step, we can advise you to read:
2. Determine how much money you are ready to lose before how much money you’ll need
Launching a new business can be expensive, but not always! It often costs more in a manner of personal time than money. To be sure, follow the steps below.
The first thing you need to do is to define how much money you are ready to invest on your project. Consider this money as lost to make your choice.
Once this step is done, it’s important to determine how much money you’ll need to get started. Here is a little guide on which costs can be taken to count:
- Determine your startup costs: Startup costs are the expenses you’ll incur before you begin generating revenue. These can include expenses like product development, marketing, legal fees, website creation, and equipment. Make a list of all the expenses you’ll need to pay for before you launch your side business.
- Estimate your monthly expenses: In addition to your startup costs, you’ll also need to estimate your ongoing monthly expenses. These can include expenses like rent, utilities, insurance, server cost, accountant fees, and any other recurring costs associated with running your business.
When it’s done, we recommend you also to:
- Determine your revenue projections: Based on your market research and customer feedback, estimate how much revenue you expect to generate each month. Be realistic and conservative in your projections.
- Calculate your break-even point: Your break-even point is the point at which your revenue equals your expenses. It allows you to determine how long it will take you to reach profitability.
- Determine your funding sources: Once you’ve estimated the money you are ready to “lose” in this project, your startup costs, ongoing expenses, revenue projections, and break-even point, you can determine how much funding you’ll need to launch your side business. Consider funding sources such as personal savings, loans from family and friends, crowdfunding, or business loans.
- Create a budget: Based on your estimated expenses and revenue projections, create a budget that outlines your expected income and expenses for the first year of your business. This will help you stay on track and ensure that you’re using your resources effectively.
3. Test your product or service
Before you launch your new business, test your product or service with potential clients to determine if there is a market for what you’re offering. This will help you refine your value proposition and ensure that you have a viable and profitable business idea.
For that, we recommend you to create one to several Proofs of Concept and Minimal Viable Products. It’s the best way to validate your idea, lower your costs, and increase your chance to be successful.
4. Create a company for your side project
Do you validate your idea with customers? Yes? Great news!
Now it’s time to create a company. By doing so, you are protecting you from personal liability and ensure that you’re in compliance with legal and tax requirements.
Depending on your business and market, you can also register your business name with your state and trademark your brand to protect your intellectual property. But, as you are in the early stages, we recommend you to do not spend time on this step. Your side project is not mature enough yet, and your business will continue to pivot with customers’ feedbacks.
If you have any question about brand registration and intellectual property in Belgium, we can recommend you to contact Sophie Everarts de Velp.
5. Develop marketing around your side project
Marketing your new business is essential for growing your customer base and generating revenue. Develop a marketing plan that includes strategies for social media, email marketing, sponsorships, and advertising.
For example, you can start by creating a newsletter for your project and promoting it on the social medial to your target audience.
Do not neglect this part and invest money for marketing. Even if you provide the best service in the world, if your audience doesn’t know about it, they will never use it.
Don’t hesitate to use marketing to test your POC and MVP.
6. Build a portfolio of clients
Building a portfolio of clients is essential for growing your business and generating revenue. Reach out to potential clients and develop relationships that will help you grow your business.
To do so, you can give discounts to your first clients. This will allow you to get first references that you will be able to reuse on your website and during discussions with prospects to reassure them.
7. Seek mentorship and education
Entrepreneurship can be challenging, and seeking mentorship and education can help you navigate the process.
Attend workshops, online courses, and conferences to stay up-to-date on best practices and connect with other entrepreneurs. Some associations are dedicated to mentorship. Search for the ones closest to you.
8. Avoid burnout
Starting a new business can be a lot of work, and it’s essential to avoid burnout. Especially if you do the side project in addition to your current work.
Keep taking time for yourself. Set boundaries and take breaks to ensure that you’re productive and energized.
9. Make the leap
Once you’ve drafted a business plan, tested your product or service, got traction from your market, got your first revenues, and secured funding, it’s time to make the leap and quit your full-time job.
This can be intimidating, but with the right preparation and mindset, you can successfully transition to full-time entrepreneurship.
10. Stay organized and focused
As a new business owner, you’ll need to wear many hats and juggle many responsibilities. Stay organized and focused by setting priorities, delegating tasks, and staying focused on your long-term goals.
11. Don’t forget legal and tax requirements
As a business owner, you’ll need to comply with legal and tax requirements. Keep track of your income and expenses, file your tax returns on time, and seek the advice of a tax professional when needed.
How to measure success for your side project?
Now that you have tips to make a successful project, you’ll probably be wondering how to measure success for your side project.
Here is a list of the different metrics you can use:
- Customer acquisition cost: This metric refers to the cost of acquiring a new customer. Tracking this metric can help you determine the effectiveness of your marketing and sales strategies.
- Customer retention: The number of customers who return to your business for repeat purchases can be a key metric for success. A high customer retention rate indicates that you are delivering a high-quality experience that keeps customers coming back.
- Conversion rate: Your conversion rate measures the percentage of website visitors who take a desired action, such as making a purchase or filling out a contact form. Tracking this metric can help you identify areas where you can improve your website and sales funnel.
- Social media engagement: If you’re using social media to promote your business, tracking engagement metrics such as likes, comments, and shares can help you determine the effectiveness of your social media strategy.
- Website traffic: The number of visitors to your website can be a metric for success, as it indicates the level of interest in your business. Tracking website traffic over time can help you identify trends and determine the effectiveness of your marketing strategies.
- Revenue: The amount of money your side project generates can be a key metric for success. Tracking revenue growth over time can help you determine if your business is profitable and growing.
- Profit margin: Your profit margin, or the difference between your revenue and expenses, can be another important metric for success. A higher profit margin means that your business is generating more revenue relative to your costs.
What can be the risks of launching a side business?
- Financial risk: Launching a new business can be expensive, and there is always a risk that you may not make enough money to cover your expenses. This can lead to personal financial strain and may impact your credit score. It’s why we recommend you to create POC and MVPs before your entire product or services.
- Time risk: Running a side business requires a significant time investment, and it can be challenging to balance your side business with other commitments like a full-time job or family responsibilities. This can lead to burnout and impact your overall well-being.
- Legal risk: Launching a new business also comes with legal risks, especially since you may be a beginner in entrepreneurship. You may need to obtain permits or licenses, comply with zoning regulations, or protect your intellectual property through trademarks or patents. Failing to do so can result in legal disputes, fines, or lawsuits.
- Market risk: There is always a risk that your side business may not be successful in the market. Even with thorough research and planning, there is no guarantee that your product or service will resonate with customers or generate enough revenue.
- Personal risk: Running a side business can also impact your personal life. You may need to sacrifice time with family and friends, and it can be challenging to maintain a work-life balance.
Do you need advice before launching your side business linked to IT solutions (app, SaaS, Software, e-commerce, website, Artificial Intelligence)?
Feel free to contact iterates for help, and have a free chat with our two founders, Rodolphe & Benoit.
Launching a successful side business requires time, effort, and dedication. It still can also be one of the most rewarding experiences of your life.
By following the 11 tips outlined in this article, you’ll be on your way to turning your side project into a thriving business.
From developing a business plan and testing your product or service to seeking mentorship and education, these tips can help you navigate the process of launching a new business while still maintaining your day job.
Remember to stay organized, focused, and flexible as you navigate the ups and downs of entrepreneurship. And most importantly, don’t forget to celebrate your successes along the way. With perseverance and a passion for your craft, you can build a successful side business that brings joy and fulfillment to your life.