Three Proven Business Models for Six-Figure Side Hustles (#2 is My Favorite)

According to a recent Gallup study, two-thirds of American workers aren’t happy with their jobs.

Of the country’s approximately 100 million full-time employees, 51 percent aren’t engaged at work — they feel no real connection to their jobs and end up doing do the bare minimum.

Furthermore, another 16 percent are “actively disengaged” — they resent their jobs and aren’t shy about telling their co-workers, friends, and families.

It’s no surprise that as many as half of millennials have a side hustle to earn extra income and/or chase a long-held passion.

Side hustles help you control your financial destiny.

But before you start your journey towards extra income (and more meaning/fulfillment), spend some time mapping out your desired situation.

Why do you want to start a side hustle and what does success look like?

  • Extra spending cash for weekend activities?
  • Pay off your credit card or student loan debt?
  • Take an extra vacation each year?

Or…

Do you want to be able to confidently turn in your two week’s notice and replace your paycheck with your own business…knowing you’ll not only earn more income, but feel better about it along the way?

Don’t make the mistake of assuming that once money starts rolling in, you’ll be able to ride the gravy train all the way to firing your boss.

Most side hustles are a one-way ticket to permanent residency in Jobville.

Chances are, you’ve already done some research on potential side hustles.

Some of the most popular content on side hustles are a seemingly endless list of ways to earn extra income.

But what separates a $500 — $1,000 a month side hustle from a $5,000 — $10,000 a month side hustle?

Why is it that some side hustlers are stuck trading time for money…while others can confidently leave their full-time job and live life on their own terms?

The answer is simple: choosing the right business model.

In other words, is it the type of side hustle that can eventually replace your paycheck? Or is it just something you do for some extra spending cash?

Ultimately, that decision is up to your income and lifestyle goals.

But if your dream is to quit your job and travel the world with a reliable online business, make sure you don’t find yourself “stuck” on the time-for-money hamster wheel

Direction is a lot more important that speed.

Here are three proven side hustle business models that have the potential to generate at least $100,000 per year in revenue.

If you’ve got over $8K flowing into your bank account each month, you should have plenty left over to pay the bills, reduce loan debt, fund your lifestyle, and jet around the world…even after paying the tax man.

Use the following criteria to identify six-figure side hustles:

  1. Can start earning money from Day One
  2. Doesn’t require a significant upfront investment (under $100)
  3. Six-figure annual income potential (your earnings are tied to results, not time and you can outsource some, if not all, of the work )

Six-Figure Side Hustle Business Model #1: Skill-based Freelancing

Thanks to the booming gig economy, more people than ever are turning hourly projects into full-time incomes.

The business model is simple:

Take your existing skills/talents/experience and sell it as a service.

You’re always on the clock as a freelancer…time is money!

Examples include:

  • Graphic design for local small businesses
  • Ghostwriter for online brands
  • Style consultant for single men

Here’s how to execute this:

  1. Identify your skills/talents/experiences that you think others will pay you for (start by looking at services YOU already pay for or model what other freelancers are successfully selling)
  2. Validate your target market is willing and able to pay for your services. Some markets are willing to pay but aren’t able (i.e., offering high-end meal delivery to middle-class families), whereas others are able to pay but aren’t willing (i.e., offering local tours to travelers — sounds good on paper, but can be difficult to get paying customers)
  3. Position and package your skills as a service — this includes persuasive copywriting, pricing, and proof that you can deliver the goods
  4. Reach out to your target market — offer your services via FB groups, freelancing sites (Freelancer or Upwork), LinkedIn, or anywhere else that your prospective clients hang out at
  5. Deliver the service — deliver the goods and get a testimonial (and don’t be afraid to ask for referrals!)

Let’s see if the freelancer model meets our rapid growth criteria:

  1. Can start earning money from Day One — if you can target your offer to the right audience, you can find someone right away who is willing to pay for your services.
  2. Doesn’t require a significant upfront investment (under $100) — if it’s a skill in your current arsenal, there’s no investment needed other than time to market/sell your services
  3. Six-figure annual income potential (your earnings are tied to results, not time and you can outsource some, if not all, of the work ) — this can be tough because a lot of your services will be trading your time for money. Given your full-time job, it’s easy to hit a time-based income ceiling unless you’re able to raise your rates (or outsource the work). While possible, it depends on a few important variables: what you’re actually doing, the perceived value of your service, and how good you are at marketing/sales.

Overall Grade: B+

Income Potential: $1,000 — $5,000 per month (up to $10,000 if you can outsource)

Summary: While an easy and fast way to earn extra income on the side, most freelancers fall victim to trading time for money and end up limiting their income potential.

Keys to Success: Picking an in-demand service with a high perceived value (i.e., web developer, technical writer) or can be outsourced without sacrificing quality. Positioning yourself as a premium provider. Leveling up your marketing/sales game (persuasive copywriting, client testimonials/case studies, and expert branding).

Best Recommended For: People with in-demand technical or creative skills who can deliver the service quickly (or outsource).


Six-Figure Side Hustle Business Model #2: Specialist Consultant

Now let’s talk about my favorite side hustle business model.

I started out as a freelancer and grew to about $5K a month in revenue selling content creation services (with outsourcing the work to other writers), but it wasn’t until I shifted to serving a specific niche did I break through to $10K— $20K per month.

At first glance, this may look similar to offering freelance services, but there are a couple of critical tweaks that mean the difference between earning $5K a month and $5K a week.

The business model is:

Master a specific niche and position yourself as an expert who can take clients from their current situation to their desired situation.

Being seen as the expert is the key to commending higher rates.

Note: I’ll be writing another blog post that goes in-depth on the advantages of this business model (and how to execute it successfully). This is meant to be a more high-level overview.

Here’s why it’s better than the freelancing business model:

  1. People pay more for transformative results — one of the most important lessons in starting a service-based business is that no matter what clients might tell you, the only thing they care about is results. They don’t care if you’re nice to them, how much time you spent on their project, who you outsourced it to, etc….if you’re getting them measurable results, they’re happy to keep on paying you.

Get this right and you’ll be able to charge premium rates and never have to worry about losing them as a client.

However, it’s not just any type of results — it has to be transformative and take them from their current situation to their desired situation.

Example: Small business owner approaches you to design their new website.

If you’re a novice freelancer, you’ll jump at the chance to pocket a quick $500. What may seem like a “win” quickly turns into a nightmare — because now the client sees you as a commodity and bullies you into changing this color or that font…and before you know it, you ‘re earning less per hour than the pimply-faced 16-year old at McDonalds down the street.

Luckily for you, you’re not a replaceable freelancer. Nope, you’re an expert consultant who knows how to get the small business what he REALLY wants (even if he doesn’t tell you). So you get on the phone with the client, find out their current situation (i.e., new business and want more customers) and desired situation (i.e.,having a website that is optimized to get them more customers), and then position yourself as the vehicle to get them from point A to point B.

Better yet, the client views you as the expert and doesn’t text or call you in the middle of the night to change the font to something more “catchy”.

Which kind of result is the small business owner willing to pay more for? A fancy-looking website that impresses “potential” customers (that may never come) or an ugly website that makes his phone ring and cash register sing?

2. People pay more for specialists — compare a general practitioner versus the brain surgeon. GPs typically work long hours in a pretty depressing little office and see back-to-back patients all day for about 15 minutes at a time. It’s a pure volume business because each patient is not worth a lot of money to them. The brain surgeon, on the other hand, works fewer hours (usually only seeing a few patients a week), enjoy more respect, higher status/prestige, and here’s the kicker…they get paid, on average, 30x as much as the general practitioner.

You want to be the brain surgeon, not the general practitioner.

Example: A personal injury lawyer is looking to publish more blog content on his website to engage prospective clients and position himself a trusted expert.

If you’re a novice freelancer, you market yourself as a “blog ghostwriter” and pitch your services at $30 per 1000 words (respectable rate for new freelance writers).

But let’s say instead of being a novice freelancer, you’ve written for other law blogs before. So you pitch yourself as a writer who specializes in helping lawyers position themselves as trusted experts. You have case studies that show how your blog posts have helped other lawyers get more clients. You use the right “code words” like “retainer” and “consultation”.

Better yet, you combine your writing experience with a transformative result — such as persuasive writing focused on helping them get more clients.

Imagine you’re the attorney and these two pitches come across your desk. Which one is a no-brainer and which one seems like a complete waste of money?

The ultimate specialist consultant stack is someone who can:

  1. Sell the transformative results (get them from current to desired situation)
  2. Position themselves as a specialist
  3. Make it explicitly clear you are helping them with something they can’t (or won’t) do on their own AND you’ll get them there faster with a proven system.

When you combine the three above techniques, you can write your paycheck because there is little to no competition.

Let’s see if the specialist consultant model meets our rapid growth criteria:

  1. Can start earning money from Day One — yes with the right positioning and marketing
  2. Doesn’t require a significant upfront investment (under $100) — if it’s a skill in your current arsenal, there’s no investment needed other than time to market/sell your services
  3. Six-figure annual income potential (your earnings are tied to results, not time and you can outsource some, if not all, of the work ) — if you specialize to an affluent market hungry for your services (i.e., business owners who want more customers)

Overall Grade: A+

Income Potential: $10,000 — $25,000 per month (up to $50,000 if you can outsource)

Summary: The absolute best model for your side hustle. Maximizes earnings while minimizes time. If you’ve got an in-demand skill, start here and skip the freelancer model.

Keys to Success: Targeting markets that have dedicated marketing budgets (at least $2,000 a month or more — B2B service companies are perfect). Prior experience, case studies, and testimonials. Marketing/selling the transformative results. Expert branding and positioning.

Best Recommended For: People with in-demand technical or creative skills, industry expertise, and a proven track record of delivering transformative results.


Six-Figure Side Hustle Business Model #3: Specialist Coach

Coaching is estimated to be $2 billion industry rapidly growing around the world.

What started out as the dirty little secret behind high-powered executives, Olympic athletes, and other top performers has morphed into a badge of honor for the upper-middle class.

Fitness coaches, nutrition coaches, business coaches, dating coaches…with the lack of enforcement of proper training credentials, it seems like anybody can become coach these days.

Caching and consulting are simply different distributions models to the same destination.

Ultimately, we hire a coach or consultant to get us from our current situation to our desired situation for one of three reasons:

  1. Inability to get there on our own
  2. Desire to get there faster
  3. Peace of mind of using a proven system

Most people start out at freelancers or consultants and then evolve into coaching when the market perceives them as trusted experts and is willing to pay for their personalized advice and accountability.

The business model is:

Master a specific niche and help clients follow your proven system to get transformative results through accountability, advice, and mentorship.

You deal directly with 1:1 clients as a coach.

As specialist coaches take on more and more clients, they transition from 1:1 coaching to group coaching. At a certain point, coaches also evolve into the digital education space by creating online training programs that people can learn and use without you coaching them.

I’m not going to get into how to execute a coaching program during this blog post, but the two key differences are:

  1. 1:1 personalized coaching usually done over Skype, phone calls, or in-person
  2. Accountability, progress tracking, overcoming limiting beliefs and roadblocks, etc

Your primary job as a coach is not doing any deliverable work, but to give them a proven system and help them execute your system from start to finish.

That’s why I don’t recommend you get into coaching unless you have a proven system that you know will work…otherwise, it could turn into a slippery slope with your clients expecting massive results and you having to do the work for them….

….which will make you more of a “done-for-you” consultant at best, and a freelancer at worst.

Now, there are done-with-you coaching programs where both you and your client are responsible for the deliverables (for example, being a marketing coach and delivering a completed website for your coaching client).

Most of you reading this aren’t in the position to become a coach because you don’t have a proven system yet.

To get that, you need to master a specific niche, get results for clients, gather strong testimonials/case studies, build a loyal audience, etc…so if you’re smart about it and have an in-demand skillset, you can absolutely start directly as a coach but you’ll likely want to work with a marketing/sales coach to help position yourself for success.

Let’s see if the coaching model meets our rapid growth criteria:

  1. Can start earning money from Day One — doesn’t meet this because you want to already have done this before and gotten results for other people. However, the massive long-term earning potential still makes this a solid model.
  2. Doesn’t require a significant upfront investment (under $100) — if you’re already gotten results for others, there’s no investment needed other than time to market/sell your services. Although you may want a sales/marketing coach (or mentor).
  3. Six-figure annual income potential (your earnings are tied to results, not time and you can outsource some, if not all, of the work ) —your ability to charge premium rates (over $1K an hour) is dependent on your track record and marketing/sales system

Overall Grade: A-

Income Potential: $25,000 — $100,000 per month (assuming you’re charging $2500 a hour and can take on ten clients per month)

Summary: The highest earning potential of any model, but requires a bulletproof brand and stellar track record. Can be done from the beginning but will need to have outstanding marketing/sales expertise. Recommended for established specialist consultants.

Keys to Success: Proven system for getting clients transformative results. Rockstar marketing and sales skills. Prior experience, case studies, and testimonials. Expert branding and positioning.

Best Recommended For: People with marketing or sales backgrounds and an undeniable track record of delivering results. Bonus if you’ve got strong leadership skills and can inspire, motivate, and hold others accountable.


Choosing the Right Six Figure Side Hustle Business Model For You

If your goal is to start a side hustle that can scale to six figures in revenue and beyond, I highly recommend starting with the specialist consultant model.

Most people default to offering generalist freelancing services, but it can be a honey trap that limits your income potential over the long-term.

I’ll be going more in-depth into each model (especially the specialist consultant) in upcoming blog posts, but for now, start writing down your income and lifestyle goals before deciding on your side hustle.

Just spending a few minutes planning out where you want this side hustle to take you will save you potentially months or years of headaches…trust me, the “cool” factor of being your own boss wears off quickly.

There’s no price you can put on the peace of mind of knowing you’ve got a dependable, long-term business that can evolve with your spending habits and lifestyle, instead of the constant pressure of having trade time for dollars.