Evaluating A New Business or Side Hustle: The Ideal Business Checklist
Updated: Apr 7, 2020
Hard times reveal a lot about us and will often times highlight our weaknesses. Personally, we find out what we are made of and what our true character is. Financially, we find out how well our house is in order and what cracks we may have in the foundation.
Today more than ever people are waking up and realizing there are cracks in their foundation. Many of us assumed there was no better financial foundation than a job, but reality just showed us all that there is little security in a job where another person decides your financial future. The wealthy have been telling us this forever.
"The average millionaire has seven streams of income." - Warren Buffett
There is no better time than right now to get your house in order and come out on top. Many are looking for ways to set themselves up for the next market crash, the next pandemic, or the next disaster. As you look to evaluate new opportunities or side hustles, there are some things you want to ask yourself.
What are you looking to accomplish and how much money will that take? (How much money do you need ongoing to be able to build the life you want, bring your wife home from work, etc?)
How can this opportunity help you create the foundation to build the life you want?
Is it active income or sustainable income? (income is not created equal. Sustainable income is how you are able to take control of your life. Active requires the work to continue for money to come in.)
Real stories of someone creating the results you are looking to create.
Sit down and answer these questions before you go down a path that leaves you worse off than when you began. If you think driving Uber or Lyft on the side is going to build a foundation for your future, I would encourage you to do the math. The average driver would tell you they make about $9/ride, which makes this active income. If you do 40 rides/week at $9/ride you would make $18,720/year. If your goal is to generate $50,000 of sustainable income (the money comes in without having to continue to drive for Uber to create it) you would have to do 40 rides/week for 66 years. This is why these questions are so crucial.
I enjoy studying new business models and businesses out there and recently came across an old article on The Dow Theory Letters. The Dow Theory Letters were written by Richard Russell. Richard was an icon in the investing community. In one particular letter, Richard outlines the 12 points of a perfect business. Whether you are looking for a side hustle or looking to break out of the corporate grind, these points can serve as a checklist when evaluating your next opportunity.
Still don't know where to go from here or need help evaluating your next idea? Drop me a message at Biggamestrategy@gmail.com or message me on Instagram or Facebook. Don't lose this time. Your family or future family is counting on you to be prepared for the next event. If you don't think it's coming or it's not your responsibility, yes it is and you will be the one to thank or to lame.