How to Turn a Hobby Into a Business: Make Money from Turning Passion into Profit

Last updated: January 23, 2024

The things you do in your spare time often fulfill you. They might be activities that challenge you, help you relax, or make you happy. Naturally, we’d all rather do things that bring us joy than work dead-end jobs that leave us feeling drained. So, is there a way to turn your hobby into a business? Yup, there is! It may take business planning, practice selling online, and a profitable business idea, but you can turn hobbies into businesses if that’s your end goal. In this article, we’re going to share how.

1. Do some goal-setting for turning your hobby into a business
2. Do market research for your online business
3. Choose a business model for your startup business
4. Test your hobby business idea
5. Build a website on a free Shopify alternative
6. Make money in multiple ways
7. Manage your business finances
8. Master sales outreach and make targets
9. Turn experiments into learnings
10. Develop work-life balance

How to Turn a Hobby Into a Business

1. Do some goal-setting for turning your hobby into a business

You will need to set some business goals for your hobby business. You’ll want to set realistic goals when business planning. Every ambitious person often sets a goal of one million dollars when they haven’t made their first sale. So, when coming up with goals, break them up into increments that are achievable. Set milestones you want to achieve in your online business. These milestones might include financial goals so you make money, but you might set other goals as well, such as getting a certain number of clients, booking demos, or creating a digital product. Turning hobbies into businesses does take time, but one of the benefits you have is you already have some experience doing it. So, you won’t need to devote much time to learning as many new skills. Setting a goal to get your first sale while this is still just a hobby for you can help give you some early confidence. That way, when you’re ready to become your own boss and leave the 9 to 5 for good, you’ll have a solid foundation to work on.

2. Do market research for your online business

A solid business always starts with market research. Your market research will include everything from how much people are willing to pay for your product to whether what you’re offering is something they’d be willing to pay for at all. Maybe there are aspects of your hobby people would be willing to pay for. For example, if your hobby is jiu-jitsu, you can offer lessons for a certain fee. However, if you find people in your local area aren’t willing to pay for lessons, you might create an online course teaching jiu-jitsu to reach a global audience instead of a local one. If you can’t make money from your hobby, then you don’t have a business. But market research will show you how it can turn into a business by finding new angles. You can use Google Trends to see which cities are most popular for your niche and if the niche is trending upwards or downwards. Doing this work before you start can save you money and headaches. When you’ve got a solid understanding, you can build a business plan that you’ll be able to show a bank to open up a business account.

3. Choose a business model for your startup business

Choosing a business model for your startup business is crucial to your long-term success. There are countless business models to choose from, but you need to select the one that’s most profitable for your hobby (not the one that’ll only bring in high revenue or users). For example, a freemium model might get you many users, but the financial reward may take longer to break even. Affiliate marketing will only give you a percentage of a sale, so it might not be as sustainable. Charging a monthly subscription can be profitable, but you might start dealing with churn. Manufacturing your own product might require upfront costs, but it allows you to have a proprietary product. A service business can be highly profitable, but you need to be aware of trading your time for money. Every business model you choose will have upsides and downsides. You can find a revenue calculator online to see how much you’ll need to make based on your costs to determine the best price to mark up your products or services. To have a full-time business, you’ll need to think about profitability to ensure you’re making money back instead of burning your cash reserves fast and ending up at your 9 to 5 job. So, take some time to do the accounting or bookkeeping when choosing a business model.

4. Test your hobby business idea

You know you enjoy doing your hobby, but out of all hobbies, is it a profitable one to pursue a business venture in? Think about how big the market size is for your hobby, how many people it attracts, and what unique product offering you can do to help people succeed. For example, if your hobby is writing, you might create services like ghostwriting, blog writing, or sales writing. However, you can also create an online course for freelance writers to book more clients. Alternatively, you can create a membership site for writers to get feedback on their work. Aim to think outside the box on all the various ways a person who enjoys writing can turn their passion into a profit by looking for unusual but practical angles to help people in their space. Once you get proof of concept, you’ll want to get a small sale to see if it’s something people would sign up for, and then you can move on to the next step.

5. Build a website on a free Shopify alternative

Payhip is a digital products and services website builder that allows you to sell physical products, online courses, services, membership websites, ebooks, and more. But unlike Shopify, there’s a Free Forever plan that has no monthly subscription. Yup, you can build a website on Payhip without paying a monthly fee (you only pay a 5% transaction fee when you make a sale).

Having a website is crucial to being searchable, especially as a new business. You can build a blog on it, send people to product pages, and sell your services directly from your own site. No matter what your hobby is, you’ll be able to find features on Payhip that allow you to create any product, from digital downloads to online courses to coaching services, any type of introverted side hustle. You can teach people how to do your hobby, create a membership site to attract those with the same interests or make physical products that people in your niche will be excited to buy.

6. Make money in multiple ways

You can make money on Instagram or promote your business on TikTok. Your business plan should list all the marketing activities you’ll be doing to transform your hobby into a viable business. There are a few things you can do, such as grow an audience on social media, build a blog to increase your website traffic, host online events or webinars, speak at conferences, set up a referral program, host a giveaway or contest, send email campaigns, start a podcast, reach out to the media, and more. Picking one or two channels to zero in on will be more effective than trying ten activities as a one-person team.

7. Manage your business finances

An important activity to run in your business is finance checks. This is when you take the time to check the profitability of your business. You’ll need to check bank statements often to ensure your business generates a profit rather than having high revenues. For example, if you run an online store that has high revenue but low profits, you might not be able to sustain the business for longer than a few months. With an online store, you’ll have to pay tax, product costs, marketing costs, and (if you’re not on Payhip) monthly subscriptions. The financial numbers are crucial for understanding how to grow your business. It’s true that it takes money to make money, but there are methods for attracting sales that allow you to grow sustainably. A business you run from home should make enough for you to live comfortably, pay all bills, and re-invest money into the business. It’s not just about doing what you love; it’s also about making money off a hobby you’re obsessed with.

8. Master sales outreach and make targets

You can make a ton of money for your online company by doing sales outreach constantly to bring in new customers. If you have a membership website, you’ll need to do sales outreach to attract new members. If you have an online store on Shopify or Payhip, you’ll need to find ways to bring in and retain customers, such as through wholesale orders. Sales outreach is necessary to keep things afloat when you sell products or services. If you get too comfortable with your current customer base, it’s only a matter of time before one churns. If all your focus is on one big client, you put yourself at risk if they churn. Set aside time each week to do sales outreach to ensure you can reach your targets for months as clients come in and out of your business. You should always make time to sell. Getting comfortable with doing sales is crucial to ensure your hobby can become a profitable business over the long haul.

9. Turn experiments into learnings

The secret to business growth is experimentation in marketing. The trial and error method will be a slow start but will lead to earlier wins. As you build your hobby business, search for ideas to tweak things. Send 20 different sales pitches and narrow them down until you find one that works. Join Facebook groups to learn from others in your niche and see what they do to grow their businesses. Build a blog and write in multiple voice tones, styles, and topics within your vertical to see what resonates with people. Offer services no one else on the market has. The more you experiment, the better you’ll get when it comes to the sales close. Those who know what works and doesn’t will succeed. It’s not about doing the same thing over and over. It’s about discovering what people genuinely want by throwing all the options on the table and seeing what people pick up the most. Your brand success will boil down to how often you experiment and put yourself out there. Offer people as many resources as possible and then narrow it down to the best-selling stuff.

10. Develop work-life balance

One of the downsides to turning your hobby into a business is that something you love is something you do for work. Having balance in life is crucial to happiness. When you take something you do for fun and make it all about turning a profit, selling products or services, and finding new customers, you might find that it sucks the fun out of your hobby – especially when you have to start paying tax on your sales. Ensure that you’re still having balance in your life by finding activities that relax and recharge you. And remember, doing what you love can be profitable, but building a business can be stressful. To prevent business stress, ensure you have a system in place to ensure money is constantly coming in, you have enough time to take breaks and enjoy life, and you have the freedom to work from home or hang out with family. Having a good balance between work and life will help you enjoy working on your hobby full-time from home.

Conclusion

Now that you know how to turn a hobby into a business, it’s time to start working towards starting the business that’ll get you out of the rat race. You can create an account on Payhip to build your own website from anywhere in the world– from America to Thailand. If you put yourself out there, do sales outreach, and offer a great product or service, you’ll start attracting customers and reap many financial rewards. You can turn your hobby into a home business; it’s time to take that first step to create the life you’ve always wanted. Sign up for Payhip today!