If you’re a business owner or entrepreneur, you probably know that it takes a lot of hard work and dedication to build a successful business. But what if there were a way you could generate extra income without having to put in any extra hours?
That’s where passive income comes in. Passive income is a way of leveraging your existing skills, talents, and assets, so you can generate extra revenue without having to actively work for it.
It can also diversify your income streams, helping you become more financially secure, as well as providing you with a steady flow of revenue you can use to help grow your business.
As you see, passive income can be an exciting and attractive opportunity for entrepreneurs. But you have to go about it the right way.
So, in this blog post, we’ll have a brief look at 20 of the best passive income opportunities for business owners. We’ll also touch on some of the potential benefits and pitfalls associated with each so that you can decide which type of passive income might suit you best.
Whether you're a small business owner just starting out or an established business looking to diversify your income streams, there is something here for you.
From investing in real estate to creating online courses… to quick-start to more elaborate… all these opportunities have the potential to bring you a significant amount of passive income.
Let’s dive in!
1. Investing in Real Estate
Real estate investing is one of the most popular ways to earn passive income. By buying and renting out properties, entrepreneurs can earn a steady stream of rental income without having to actively manage properties on a day-to-day basis.
Additionally, many real estate investors earn an extra source of passive income through appreciation, as the value of their properties increases over time.
One of the key advantages of real estate investing over other types of passive income is that it allows you to leverage other people's money through the use of mortgages. Mortgages allow you to invest in more properties than you could otherwise afford, potentially earning you even more passive income.
And with a variety of property types available, including single-family homes, multifamily properties, and commercial buildings, you can even choose the rental property that best meets your needs.
It's important to note that like most investments, the value of properties can go up as well as down. And it is possible to lose money if the value of the property decreases or if it becomes difficult to find tenants.
Also, being a landlord comes with its own set of responsibilities and potential headaches.
So if you think real estate investing could be a good source of passive income for you, be sure to do your due diligence and understand the potential risks before getting started. It’s always a good idea to consult with a real estate professional or financial advisor before making any investment decisions.
2. Rent Out an Extra Room on Airbnb
Renting your home or even your spare room on Airbnb can be a great way to earn passive income and make the most of your property.
The process is super simple:
First, decide on the space you want to rent out. This can be an entire home, a bedroom, or even a shared space.
The next step is to create your listing on the Airbnb platform. You’ll need to add photos, write a description, and set the availability and pricing for your space.
Once your listing is live, you can start accepting bookings. The Airbnb platform handles all the payments, so you don't have to worry about collecting money from guests. Airbnb also provides insurance, protecting you from any damages to your property.
If you want to optimize your passive income even further, you can adjust your pricing and availability at any time during on/off-peak times.
Even though renting your room via Airbnb is passive income, you may need to be available to communicate with guests and handle any issues that may arise during their stay.
You’ll also need to keep your property in “ready to rent” condition, as well as abide by the relevant laws, regulations, and taxes in your area.
3. Peer-to-Peer Lending
Specialist Peer-to-peer (P2P) lending platforms can be a great way to earn passive income while giving you the chance to support other small businesses and entrepreneurs.
By lending money to others who need to borrow money, you not only receive regular interest payments, but you’re also spreading and growing your investment portfolio as you help out your community.
Investing on peer-to-peer lending platforms is relatively straightforward – user-friendly interfaces and helpful customer service staff will guide you through the process of creating and setting up your account.
Once you’re set up, the platform can connect you to borrowers, so you can start investing and earning passive income.
Even with the safety of the platforms, P2P is not without its risks. Borrowers may still default on their loans, and you may not earn as much interest as you expect.
Always research the platform and the loans you are considering investing in before investing.
Additionally, be sure to check the fees and regulations associated with P2P lending and to consult a financial advisor before getting started in this, or any other investment program.
4. Creating an Online Course
Creating an online course is a great way for entrepreneurs to earn passive income. By creating a course on a topic that you are knowledgeable and passionate about, you can sell it to a global audience and continue to earn passive income from it for as long as you like.
The best way to create an online course? With my Product Launch Formula® (also known as PLF). 🙂
Thousands of students have used PLF to generate over a BILLION dollars in sales. There really is nothing like it in our industry.
Whether you use PLF or not, creating your online course can be broken down into a few key steps.
First, you need to decide on a topic. So think about the skills, talents, and knowledge you have that you think others would happily pay to learn.
Do you have the secrets to blasting jaw-dropping 300-yard drives on the golf course?
Can you create beautiful floral arrangements from a bunch of weeds?
Have you discovered the secret to beating exam stress?
Once you’ve chosen a topic, you need to create an outline for your course so you can start making the content. This can include videos, audio recordings, PDFs, and graphics, so think about your audience – how would they prefer to learn your amazing secrets?
When the course is ready, you need to market it to potential customers. You can do this through social media, email marketing, or through paid advertising. You can also reach out to other experts in your field and ask them to promote your course to their audiences too (in Product Launch Formula, we call this a Joint Venture Launch).
Though creating high-quality content for your course can take a lot of time and effort, once done, it can be a great source of passive income. You can continue to update and improve your course over time, giving it an even longer shelf life.
(I started selling the first edition of Product Launch Formula in 1996… and it’s still going strong!)
5. Dividend Investing
Dividend investing involves buying stocks from companies that pay out regular dividends rather than speculating about which stocks are going to go up or down.
Dividend stocks make for a great form of passive income because they give you a consistent income over time without needing you to actively manage your investments.
Many investors find dividend stocks to be relatively safe investments too, making them even more ideal for those looking to build a stable passive income portfolio.
It's important to note that investing in stocks always carries the risk of losing money and it's important to do your own research and consult a financial advisor before making any investments. Additionally, you should also be aware of the taxes that may be applied to dividends and capital gains.
6. Affiliate Marketing
Affiliate marketing involves you promoting other companies' products or services and receiving commissions when someone buys them through your link or referral code.
It’s a great way to earn passive income, allowing you to take advantage of an established brand without needing to invest any of your own time or money into the venture.
It's also easy to get started, as there are no expensive startup costs, specific skills, or knowledge required. All you need is a referral code or link.
Not only can affiliate marketing create an additional passive income, but it also helps you support and connect with your favorite businesses and entrepreneurs.
Who knows? Maybe one day they’ll be promoting YOUR offers to their audience!
The #1 key to success in affiliate marketing is to only promote products you have complete confidence in. Your customers will lose faith in you if they have a bad experience with a product – or supplier – that you’re promoting.
Once burned, twice shy…
7. Selling Digital Goods
Digital products are a great way to earn passive income – and you can reach a global audience just by leveraging your skills.
The first step is deciding what type of product you want to sell.
You can sell ebooks, online courses, templates, stock photos, and many other types of digital products. You could even do a mix of several products (an online course with video lessons, PDF handouts, and downloadable templates, for example.)
Once you’ve decided what you want to create, get to it! The key here is to focus on creating high-quality, valuable content your audience is going to love (and pay for).
Next, you need to set up an online store to sell it. If you have web design experience, you can do this yourself. But if you don’t, a quick and easy way to create an online store is by using one of the many existing platforms like Shopify or WooCommerce. Most platforms are super easy to use and you can be set up in just a few clicks.
Once you’re up and running, you can start promoting your digital products. A great way to do this is by using social media, email marketing, and paid advertising.
It may take time and effort to set up your store, build an audience, and create a range of products. But once you have, you'll continue to make sales – and passive income – 24/7.
8. Set Up a Membership Site
A membership site can be a goldmine for passive income. Membership sites offer exclusive content or services to paying members. A great example is Netflix – you pay a monthly fee so you can binge your favorite shows to your heart’s content.
When it comes to creating memberships, entrepreneurs have a unique advantage – because they know how to identify gaps in the market and create solutions to fill them.
If you want to do the same, you'll need to spot a gap in the market and create valuable, exclusive content or services to fill it.
In short, what problem are you going to solve… and for who?
Once you know the answers, the next step is to start creating awesome content. You have got a choice of options here – videos, webinars, walkthrough screen share videos, or ebooks. You could even build a forum for members to interact with each other.
Of course, you’ll need to build a website to store all of this awesomeness. Your website should be easy to navigate and visually appealing. It should also be super easy for potential members to use (and buy from!).
Got all that? OK, when you have everything in place you can start talking about your membership – and earning passive income. Use social media, advertising, and email marketing to attract new members.
Don’t forget to regularly update and improve your content. This helps keep your existing members happy and engaged so they renew.
Though membership sites can often take time and effort to grow, they’re a great way to earn passive income. And you might even find that once you’ve built a community of active, engaged members, they’ll tell all their friends about you, bringing you even more members.
9. Create an App (no coding experience required)
Developing and selling apps for mobile devices can be a great source of passive income, even if you have zero coding or software experience.
There are plenty of app builders and “no-code” platforms that use drag-and-drop technology and ready-to-go templates to help you develop your own apps without you having to learn a line of code.
Looking for an even more hands-off approach? How about hiring a developer to create an app for you?
While hiring a developer can be costly, it affords you the luxury of being able to focus on designing an awesome app while leaving the technical aspect to someone else.
Whatever route you take, the key is to have a well-designed concept and look for your app. Be very clear about the problem your app solves.
Be sure to research different app builders, platforms, and companies before you start. That way, you're sure to find the best one for you.
And don't forget to test your app, get feedback from customers, and update it regularly to improve its performance and appeal, so it can keep earning you passive income for longer.
10. Earn While Shopping Online
If you’re like most people, you already shop online. But did you know that online shopping is one of the quickest and easiest ways you can start earning passive income?
By taking advantage of cash-back programs, referral links, and more, you can make a few extra bucks with every purchase. Let’s take a quick look at some of the ways you can earn passive income while shopping online.
Cash-Back Programs – these give you a percentage back on your purchase in the form of cash or store credit. With this type of program, it pays to do your research and find out which stores offer the highest rewards for your purchases. For example, some clothing stores offer 10% back when you shop with them. This means that if you spend $100 on clothing from that store, you will earn $10 back as a reward.
Referral Links – many websites offer referral programs where they reward users for referring their friends and family to the site. This could be in the form of cash or store credit depending on the website’s policy.
Discount Codes – most websites have coupon codes that can be used to save money on your purchase. One of the best ways of getting access to all these coupons is by subscribing to your favorite stores and coupon-collecting websites.
As you can see, online shopping doesn’t have to be just about spending money – by using these tips and tricks, it can also be an opportunity for you to earn passive income!
Just be sure to NEVER exceed your monthly spending budget or max out your credit card in a bid to earn some reward.
11. Start a YouTube Channel
Posting videos on YouTube can be a fun and entertaining way of generating passive income.
If lots of people watch your videos, you’ll start to make money from ads. You might even get requests from brands, offering to pay you to show their products in your videos.
But getting famous on YouTube isn't easy. There is no “fast track” to fame…
To become a YouTuber, you'll need to make videos that people want to watch. That’s because the more people watch your videos, the more passive income you can make from advertisers.
There are a lot of channels out there, so you need to think about how you want to stand out. A great way to do that is by talking to your viewers and getting to know them.
Do that, and you’ll get a feel for what videos they enjoy most, and what makes you different.
The more you talk to your subscribers, the more they'll like you and keep watching your videos, getting you even more views!
12. Sell Stock Photos
If you have a great eye for capturing beautiful moments and unique scenes, photography can be more than just a hobby or a career. You can also earn passive income by selling your photos as stock images on sites like iStockphoto and Shutterstock. It’s a fun and easy way to earn some extra money on the side.
It couldn't be simpler – every time someone buys one of your photos, you'll get paid. The more photos you upload, the more chances you have to make money.
When uploading your photos, make sure they are high quality photos people would want to use for their own projects. And try to add more photos regularly so your portfolio keeps growing. Before you know it, with a little effort and a great eye, you could start earning passive income from your passion for photography.
13. Start a Dropshipping Business
Dropshipping is a cool way to make passive income by selling products online. Instead of buying and storing the products yourself, you work with a supplier who will ship the products directly to your customers. This way, you don't have to worry about holding any inventory, which can be expensive for regular stores.
Starting a dropshipping business is great for people who want to be their own boss because it doesn't require a lot of money to get started. All you have to do is find the products you want to sell, add them to your online store, and start promoting them.
When someone buys a product from your store, the supplier will ship it to the customer for you. So you only need to focus on getting people to your store and making sales.
The best part is that the more successful your store becomes, the more money you can make. If you have a cool store with unique products that people can't find anywhere else, the possibilities for passive income are endless.
14. Sell Handmade Items on Etsy
If you're creative and enjoy making things, selling your handmade items on Etsy could be a great way to make passive income as you spend more time doing what you love.
To get started, all you need to do is set up your own online store on Etsy. You can choose what you want to sell, like jewelry, clothes, accessories, or home decor. Whatever niche you choose, you'll be tapping into lots of excited buyers who are looking for handmade items just like yours!
Using Etsy is super easy and convenient. You can use social media to promote your products and connect with potential customers. Etsy also has plenty of tools to help you track orders, manage payments, and ship your items, allowing you to focus on making and selling your items… and generating passive income.
15. Create a Niche Website
If you have special knowledge or skills related to a specific topic, creating a niche website around topics or keywords related to your field of expertise can be an easy way to generate passive income through affiliate programs and ads.
Companies often have affiliate programs that people can join to market their products and services, and through careful keyword optimization, you can ensure your website is easily found by potential customers who would benefit from what is offered and are actively looking for a solution.
To earn money via ads on a niche website, you'll need a decent amount of passive traffic, but with the right strategies in place and high-quality content that people enjoy reading, this passive income stream can be extremely lucrative.
As well as Search Engine Optimization, you can use content and social media marketing to drive traffic to your site. And though creating content can be time-consuming to begin with, once posted, it can generate large amounts of traffic – and passive income – in the long run.
16. Publish Ebooks on Amazon Kindle Direct Publishing (KDP)
If you have a flair for words and are looking for a way to monetize your interests, Amazon's Kindle Direct Publishing (KDP) platform is an excellent way to get started earning passive income.
KDP allows authors and publishers to easily upload manuscripts as ebooks for sale on Amazon.
From editing and design to marketing your book in over 180 countries, KDP makes it easy and fast to start monetizing your books. You can even control the pricing, allowing you to optimize your level of passive income.
In addition, the site has helpful resources for authors about how to maximize passive income potential for their published works.
The key to maximizing your passive income is to consistently produce high-quality books, promote them effectively, and monitor their performance, making improvements where necessary.
17. Record Audiobooks
If you have a pleasant speaking voice and can follow directions well, recording audiobooks from the comfort of your own home could be a great source of passive income for you.
As an audiobook narrator, you need to set up a recording studio. This can be as simple as a quiet room with a good microphone and a computer or as advanced as a professional recording studio. As long as your audio is crisp and clear, you’re good to go.
Once your recording setup is complete, you can start recording the book and editing the audio to make it sound polished.
(If you need help with editing the audio, you can find plenty of freelance editors on websites like Fiverr who will do it for you for a small fee.)
Once the recording is complete, you can distribute your audiobook through various platforms such as Amazon, Audible, and iTunes. The platforms handle all the distribution and payment for you, so you never have to worry about collecting money from customers.
And because your audiobooks are on sale 24/7, you’ll continue to earn passive income even when you’re not working.
The more books you record, the more potential passive income you can earn!
18. Build and Sell Spreadsheets
A lot of folks are terrified of spreadsheets, so if you're a formula, formatting, and logic whiz that loves spending long hours in Excel or Google Sheets…
Selling spreadsheets could be the passive income vehicle for you.
Whether you offer pre-built or fully customizable one-off spreadsheets, building and selling a spreadsheet is like selling your expertise without the hassle of constant work.
If your spreadsheet solves a common and valuable problem, you can earn even more passive income by selling it over and over again to different customers.
When designing your sheets, it’s important to ensure that the spreadsheet is as simple and easy to follow as possible. That way, your customers can start using it – and seeing results – right away.
Selling spreadsheets is not only a great source of passive income, it's also a great way to get clients. Once they’ve witnessed your spreadsheet wizardry, they could hire you for freelance work!
19. Create and Sell a Design Template or Website Template
If spreadsheets aren't your thing but you're a whiz with WordPress or website programming, you can make passive income by creating and selling website templates.
You can start earning passive income quickly by creating templates for popular content management systems like WordPress, Shopify, or Wix.
Ensure your templates are visually appealing and easy to use, as this will increase their appeal. Once you are happy with your template, you can then also sell these templates on marketplaces like ThemeForest or Creative Market, or directly on your own website.
To maximize the amount of passive income each template generates, be sure to regularly update your templates to keep up with the latest design trends and technology advancements.
Additionally, offering customer support and tutorials can also increase customer satisfaction and repeat business.
Designing websites is a potentially lucrative market, especially for entrepreneurs looking to build passive income. By leveraging your design and technical skills, you can also reach a wider customer base than you can doing freelance work.
20. Invest in a Business
Investing in an existing business that is already generating revenue can be an effective way of generating passive income, especially for entrepreneurs who are familiar with the market.
Investing in a business gives you the chance to take advantage of its proven track record and the experience of the current management team so you can make returns quicker than you would if you were starting a business from scratch.
Also, the passive income you gain from investing in businesses could be even more profitable because businesses often appreciate in value over time, paying out extra dividends on investments.
When investing in an existing business, it is important to do your due diligence and carefully research and assess the business's financials, growth potential, and competition.
If you're looking for an opportunity to earn passive income without getting involved in day-to-day operations, investing in an existing business could be good for you.
The Bottom Line
Generating passive income doesn't have to be difficult. With a bit of planning and research, you can find and create passive income streams that are ideally suited to you and your goals.
Whether it’s setting up passive investments in stocks or bonds, creating your own digital products to sell online, investing in an existing business, or even creating websites – there are a lot of passive income ideas to choose from. Hopefully, this blog post has given you some ideas to get started.
It’s important to remember that passive income isn’t always passive at the start. Some of these suggestions require a fair amount of time, effort, and money to start the passive income ball rolling. But with a bit of research and effort, these suggestions can be an excellent way to help secure your financial future and create passive income streams to help you achieve your goals.
The key is finding something that fits within your area of expertise. Once everything has been set up properly, all it requires from then onwards is maintenance rather than active management – allowing you more freedom while still enjoying the financial reward from your efforts!