Every side hustle has the potential to be fun and profitable. But sooner or later, you’ll want that side hustle to be less of a side business and more of a primary business venture. The only problem: it’s tough to know when your side hustle is ready to be a full-time business and when you should take the leap to become a full-on entrepreneur!
If you’re having trouble knowing when your side hustle is ready for this step, read on – we’ll break down several signs that may indicate your side hustle has the financial and industrial legs to carry your career for the duration.
You Spend as Much Time on Your Side Hustle as Your Main Work
One great way to know that your side hustle is ready and able to evolve into a full-time enterprise is by looking at how much time you spend on it. Do you work a 40-hour job? Great. But do you work an extra 50-hours on your side hustle? In that case, your side also might need to become your main hustle from a certain point of view.
“There are only 24 hours to spend each day. It’s important to allocate those hours as best as possible. If you already spend as much time, if not more, on your side gig, that side gig is no longer a side gig by definition,” says Jason Panzer, President of HexClad. “It has developed into something great and something much more important in your life.”
If you’re in doubt, simply log how many hours you spend on each aspect of your life each week. If the tally ever gets close to 50-50 between your side gig in your day job, you’re about ready to transition your side hustle into your primary source of income and satisfaction.
You Turn Away More Work/Business Than You Accept
Another important sign is when you are turning away more work in business than you can reasonably accept. Most small businesses and freelance enterprises reach this stage after a few years of operation.
For example, in the beginning, you likely have to scramble for every job or gig available. Every bit of business you receive is precious. “Those initial jobs are oftentimes most important,” says Katy Carrigan, CEO of Goody, “because they set the tone for the type of clientele you’ll cultivate and they are the earliest bits of reputation you can generate online.”
But over time, you cultivate a reputation, you grow your skills and clientele, and eventually, you don’t need to seek out new clients. Those clients come to you.
But that’s not all. Eventually, you have so many clients coming to you that you have to turn down work, lest your current projects suffer. If you’ve reached this stage, it means you need to expand your business. You need to hire new employees, open an office, or at least dedicate your attention to your side hustle full-time.
In other words, it’s time to make your side hustle a full-time business and leave your day job by the wayside!
Other Businesses Make You Offers
You can tell that your side hustle is getting important industry attention if other businesses or enterprises make you offers to buy your business. Say that you have a small business selling T-shirts or custom apparel.
One day, you receive an offer from another T-shirt business offering to buy your brand, its logo, and your current inventory. Once you have this offer, you can rest assured that you have the attention of the competitors in your niche.
You don’t have to accept that offer, of course! Instead, you can take it as a sign that your side hustle is successful enough that it can make it in the real world. You can devote even more attention to your business and potentially outcompete similar organizations to become the master of your new domain.
You Make More Money from the Side Hustle
Naturally, if you look at your finances and discover that your side hustle nets you more money than your day job, your side hustle can potentially provide you with all the financial support you need in perpetuity!
You should do the budget in detail, however. “Make sure that transitioning your side hustles into a full-time business will let you make enough cash that you are still financially secure,” says Jin Young Woo, CEO of Like Dreams. “Still, if your day job is now massively overshadowed by the income from your side hustle, who’s to say you still need that day job? If the difference is minor, remember that transitioning your side hustle into a full-time business could very well cause that side hustle to make more money in aggregate. Weigh the pros and cons, decide whether the transition is worth it, and pull the trigger.”
You Still Care About Your Side Hustle
Lots of entrepreneurs and small business owners eventually find that their fervor and interest in their side hustles fades with time. That’s okay! In fact, for many entrepreneurs, it takes a few side hustles or businesses to find the exact right niche or industry that you love or want to work in for the rest of your life.
But if you have a current side hustle and you find yourself still looking forward to cracking on with work related to it, or if you still like working at your side hustle job, it might be a sign that it should be your full-time career in the future.
Robbie Singh, CEO of Predecessor Game says, “Long-term interest is an excellent sign that a given gig, industry, or business idea is more worthwhile than your others. Any job can make money, but only true interests will stay engaging and invigorating to you for years on end.”
This is also important for your long-term business’s success. If your side hustle is to become a truly successful enterprise, you need to love it beyond what it puts in your pocket. “Passion is what makes the difference between successful entrepreneurs and perpetual would-be business owners who are always chasing after the new big thing or the next great idea,” says Morgan Rogers, Director of Marketing at Luna Grill.
You Can Do the Administrative Work
For your small business or side hustle to become a major organization, you’ll need to take on a lot more paperwork. With this in mind, make sure you can do all of the necessary administrative work before turning it into a full-time business.
For example, you may need to file for an employer identification number or EIN. Or you may need to hire employees for the first time. This requires you to take on a new responsibility as a manager or executive, not just a startup hustler or entrepreneur.
“If you aren’t sure whether you can do the administrative work to transition your side hustle to a full-time business, practice at it for a few weeks,” suggests Trina Johnson, CEO of Blue Forest Farms. “Keep track of the accounting books, apply for some basic business licenses, and imagine spending more of your day keeping track of things instead of being a front-line worker.”
If it all still seems great, go for it and scale up your business into the major leagues!
You See the “Snowball Effect”
Lastly, your side hustle could be ready to become a full-time business if you reach the so-called snowball effect. In a nutshell, the snowball effect means that your business has enough financial or other inertia to carry itself into larger and larger business niches.
Say that you start off with a basic business selling homemade jewelry or other arts and crafts. As people become aware of your online brand, you sell more and more jewelry pieces, make more and more money, and eventually expand your business to include two other jewelry makers.
At this point, you barely have to advertise – your jewelry store is so popular and word-of-mouth is so strong that it has become a snowball. Your business will grow with or without your intervention at this point. Given this fact, it may be wise to transition your focus more to your side hustle as opposed to your day job or other business ventures.
When you hit the snowball effect, it means:
- You’ve found a great market
- Your business has capitalized on enough of that market niche to be successful
- You barely need to add new marketing materials to continue growing
Take a hard look at your finances and, if you think you’ve hit the snowball effect, consider making your side hustle your full-time career or profession. Congratulations!
Ultimately, any side hustle can become a full-time business with the right attention, drive, and market understanding. But you need to be ready to make your side hustle your primary business or venture as soon as possible. If you started your side hustle for the right reasons, this would be a great thing – who doesn’t want to do their dream job each day?