Passive businesses do exist and they can bring you some beautiful profits, if handled as they should. Without any trace of a doubt, there are some amazing strategies that will assure you a great life-work balance and will make everything even easier in the long run. For instance, cryptocurrency investments are a great income source if you end up mastering those, while business ideas such as real estate investments will bring generous profits as well, they require some initial efforts on the investor’s part before becoming truly passive. Regardless, below we have a set of suggestions that might please plenty of individuals.
What does “Passive Income” exactly mean?
“Passive income” is that particular type of income generated by a property (real estate) or a limited partnership in an enterprise, without being actively involved in the activity of that particular business establishment. Basically, whatever money is generated with minimal efforts by any sort of entity. The real estate industry is the most illustrative for this, as besides the initial investment, the owner doesn’t have to bet involved too much in the business, or the efforts are minimal. On a more dark-humorous note, if the owner dies, the business will still generate an income, as it won’t be affected by this event in any shape or form. However, the association with the real estate industry is a subject of debate in some circles, as the owner will still have to communicate with third parties, deal with maintenance issues and other similar aspects. For many, this is not a real “passive-income” source. But, the stock market, is. However, truth be told, intelligent skilled stock market investors are still very likely to put some additional efforts, keep a close eye on the market evolution and so on. However, the online sphere is plenty of passive income opportunities, in some of the most accurate forms of this investment strategy. Selling advertising on a website, for instance, is one of those ways in which you can make some decent bucks, without doing anything for it. Or, if you’re not a big fan of fussy little ads yourself, you could follow the “The Pirate Bay” model and eliminate those, but mine cryptocurrency, instead. Don’t worry, the website is using this method in a highly transparent way and informed their users of their new strategy.
Which business models are closer to a passive income model?
Now that you just painted a clearer idea on what does a passive income model look like, you most probably wonder which the most reliable and accurate examples of such businesses are. Below is our selection of those strategies that resemble the most this type of investments.
- Cryptocurrency exchanges – this may be something familiar to those that are knowledgeable in terms of stock trading. Simply put, this is an opportunity for investors to exchange a cryptocurrency for another. You could swap Bitcoins for Ethereum, for instance, and you can do it with whatever virtual currencies you anticipate that will increase in value in the future. This is somehow similar to trading real money for stocks. In the blockchain world, Bitcoin is generally seen as the equivalent of the “real money” and other cryptocurrencies are seen as the equivalent of “shares in a company”. The other virtual currencies are also named “alt-coins”.
- Sell online advertising space on your website – website owners have the opportunity o generate some passive income if they consider selling online advertising on their websites. The main strategy is publishing content that is SEO-friendly and increasing the traffic to your website. You can do this in a passive fashion by collaborating with an SEO agency and letting the experts there to create your website’s content. Then, simply sell ad space or banner space to various businesses that may be interested in that type of audience that you have. This works as a two-way collaboration. While you will make extra money in a very passive fashion, other businesses will also benefit from increased traffic and sales on their websites.
- Selling “information products” online – this is a highly profitable business idea, that resembles incredibly the “passive income” business model. While some initial efforts will be necessary, you will have a profit margin of about 100%, as you won’t need any sort of investment to create or sell your products. Everything happens online. Information products are those type of products that educate, inform and train the consumer. If you have expertise in a domain, you could actually profit from it, create a product like this in whatever format you prefer and then retail it online. Those formats may vary from webinars to e-books, audio books and so on.
- A drop shipping business – drop shipping businesses are well-known for the flexibility and comfort offered to the owners. This is the main reason for which this is one of the main investment strategies preferred by those interested in a passive income investment strategy. This business model simply means that you sell products from other companies, submit orders for their products and other companies simply deliver the products to your clients. Pretty simple, right?
So, can you comfortably live on a passive income?
Experts say that yes, you can. The main idea is choosing your business model with care. While some may lack the knowledge to deal with some of the suggestions above, you can always find the necessary resources online, learn, apply and perfect those investment methods until you bring those to perfection. However, don’t expect to sit on a chair daily without doing the slightest effort for your business, at least not at the beginning of your journey. If you want to turn a business model like this in a passive income source, you have to put some initial efforts into it.
Keep in mind to search for that particular passive income strategy that appeals the most to you. Otherwise, you may end up dreading the first initial months, and you are very likely to abandon the process before actually turning into a profitable business.