Having a side hustle is all the rage nowadays. It’s estimated that around 70% of young Brits have a side hustle outside of their regular jobs. This is largely thanks to the rise of the internet, e-commerce, and social media. Even when people clock off from their regular job at 5pm, they can still contact (and sell to) customers located all around the world.
For most of us, our side hustles represent our true passions—while we only have ‘regular’ jobs to keep the lights on and put food on the table. But how do you know when you can turn your side hustle into a full-time enterprise? What are the signs that your side hustle is ready to take the next step—and that you should hand in your notice?
To be honest, this is more art and science. There are no hard and fast rules here —but there are certain signs that you need to be aware of. Let’s delve into what these are below.
If you’ve already decided to set up a private limited company in the UK and want to get your company registered, we can help with you that! Otherwise, do read on.
When You Realise It Can Cover Your Expenses
Most fledgeling entrepreneurs would happily give up their day job and focus solely on their side hustle, except for one thing: they need money to survive. Their job offers them a promised income every month. They can pay their bills, buy food, and afford rent. With side hustles, however, there are no guarantees. Running your own business might sound fun—but you never know exactly how much money you’re going to earn that month.
That said, you might start noticing that your side hustle is really beginning to take off. It will probably start slowly, generating a few hundred pounds here or there. But if you find that the amount of money keeps on growing steadily, and you estimate that you can cover your living expenses, then this is a sign that you should consider giving up your day job.
It’s worth first identifying how much you spend each month on non-negotiable costs: rent, electricity, gas, food, council tax, and so on. Then, work out how much you need to fulfil other aspects of your life—whether this is a gym membership or train tickets to see your family from time to time.
This will give you a rough idea of how much money you need to be making from your side hustle. It’s always good to have a concrete figure in mind so that you know whether your side hustle will actually be a viable 24/7 job.
Even if you find that your side hustle can indeed support you, the decision to quit your full-time job will never be easy. In fact, according to Sophie Clyde-Smith, a life and career coach, “The main thing to acknowledge is that it will always feel scary. Even if you’ve been building momentum and your side hustle income matches/outruns your 9-5 salary, it will still feel like a leap. This is totally normal but can hold a lot of people back from biting the bullet.”
When It’s Your Passion
Most people don’t start a side hustle just to make money—they start it because it’s something they truly care about. Martha Stewart, who is now worth an estimated $400 million, used to work in Wall Street. But making money on the markets wasn’t her passion—entertaining guests was. She turned her passion for entertaining into a viable business and has never looked back.
Of course, passion alone won’t pay the bills—so it’s important to recognise whether your passion will actually support you and your family (as per the point we made above).
However, if you find that your side hustle is becoming increasingly profitable—and you spend all day, every day thinking about it—then it’s clear what you have to do. Listen to your gut. Think about where you might be in five years time if you stayed at your normal job. Does it make you feel excited? Or just “meh”? Then, think about where you could be if you devoted yourself full-time to your side hustle.
If you’re truly passionate about something, it’s easy to be persistent—and persistence is arguably the most important factor that defines whether or not an entrepreneur will be successful. Jay Samit, a serial entrepreneur who once taught a broke millennial how to become a millionaire in just a year, says in his book, Future-Proofing You, “Passion will make you unstoppable. Perfect the learned skill of persistence to turn your passions into success.”
When Your Customers Love What You’re Doing
It’s worth highlighting that passion doesn’t just come from within. If you are doing something right, you might find that your customers are just as passionate as you about your business. Think about the early Apple Mac adopters, or the first thrillseekers to use GoPros. They loved the products because it made their lives so much better than before—and they couldn’t wait to tell other people about the businesses.
If you find that your side hustle keeps on receiving rave reviews from customers, you’re onto a winner. The best businesses help people solve their problems. If you can successfully do this, your customers will love you, and they’ll tell you about it. This is the key sign that you’ll be able to successfully scale your business going forward.
Use customer reviews as a temperature-check into how your side hustle is performing. If it’s going well, and you keep on delighting customers, then your side hustle might be ready to turn into a full-time enterprise.
When You’ve Reached The Snowball Effect
You've likely heard of the snowball effect before. When a small snowball starts to roll down a hill, it will accumulate more and more snow. This will make it bigger, heavier, and will increase the speed with which it rolls down the hill. It will therefore accumulate even more snow—and will get even bigger.
So how does this apply to your side hustle?
Maybe one of your earliest customers is so happy with your product or services that they tell somebody else. The person they tell decides to give your business a go— and when they do, they are similarly thrilled with what you offer, so they tell another person. Soon, you’re gaining more and more customers despite spending the same amount of time and money on marketing. Your business is growing at a rate of knots—and this momentum keeps on fueling itself.
At this point, it would be a tragedy not to focus on your business full-time. There is clearly a need in the market for your product or service—and customers are obviously responding well to what you offer. Once a snowball effect has started, it’s incredibly difficult to stop—and there is no reason why you would want to.
Your business is ready to be turned into a full-time enterprise, and there’s not a second to waste.
If you read through this list and thought “yep, yep, yep”, then the takeaway is clear: make the leap. Devote 2022 to turning your side hustle into a full-time business and see where it takes you.
It won’t always be fun. It definitely won’t be easy. But if you’re passionate about it, and you’re helping other people, then it will certainly be rewarding.
If you’re ready to take the next step then make sure you have the right tools in place. For instance, Osome’s e-commerce accounting tool. To learn more about how we help e-commerce businesses save money, grow, and stay compliant, get in touch to speak with a member of our team.