Should You Turn Your Hobby Into a Business?
Millions of people pursue untold numbers of hobbies throughout their lives. Most of them never consider turning those passions into a business. But maybe they should.
There are good reasons to consider turning a hobby into a business. There are also good reasons to avoid such a venture. Having a list of pros and cons can help a potential small business owner decide if they’re ready to take the next step.
The Upsides of Turning a Hobby into a Business
There are many upsides to turning a hobby into a business. Here are just a few to consider:
Being the Boss
Just like any small business venture, one of the most attractive reasons to turn a hobby into a business is to become self-employed. Most people know whether or not they have an interest in being their own boss. If they do, monetizing a hobby may be the way to get there.
Passion Payday
One of the most powerful reasons people turn a hobby into a business is to make money doing something they love. A long-time hobbyist with extensive experience and knowledge has already put in some of the work needed to start a company.
Acquiring skills, honing a craft, and actively participating in a community all provide valuable resources to a new small business owner. Hobbyists who have seriously pursued these avenues have an advantage.
But it isn’t all about having the foundations of a business. It’s also about the desire to turn a passion into a livelihood. This is a complicated area and one that can be both a positive and a negative.
Looking at it as a positive, people turning hobbies into full-time businesses can focus on something they love doing and maybe give up an unfulfilling job or career. Others can add a small business to their other paid work and increase their income in a truly enjoyable manner.
Testing the Waters
Hobbyists have a lot of options for the type of business they want to start. Some want to have a full-time business based on their hobby. Others may desire something different.
Monetizing a hobby by forming a small business doesn’t have to be all or nothing. Many people maintain a small business while also pursuing a career or full-time job. Turning a hobby into a part-time small business is a way to pursue extra income in a less stressful fashion.
Starting slowly with modest goals gives the hobbyist time and space to set up a good business plan and learn the finer points of business finance. It also allows the new business owner to learn about marketing, demand, and the daily effort involved in running a business with a smaller personal and financial investment.
Starting very small gives hobbyists space to decide if the business world is for them. It also allows for meaningful growth dictated by both the viability of the business and the personal satisfaction of the owner.
Taxes
Most people put some money into their serious hobbies. Be it art or craft supplies for creative projects or educational activities to further expertise, those costs can add up.
As a hobbyist, those expenses are not deductible. As a small business, they may well be. Whether this alone is a good enough reason to turn from hobby to business depends on the significance of the expenses.
The Downsides of Starting a Business from a Hobby
As tempting as it is to see dollar signs in every hobby, there are some negatives to consider. Not every hobby is destined to become a business.
From Passion to Pressure
A hobby is something people do because they enjoy the activity. Setting up and running a business may not fall into that category. One of the largest hazards in turning a hobby into a business is losing the joy once associated with the hobby.
The pressure to meet deadlines, produce products, and manage the financial aspects of a business can overwhelm the pleasure a hobby activity once held. It’s easy to find that a hobby isn’t nearly as enjoyable when it becomes something that consumes all or most of every day.
Becoming a Businessperson
Starting a business means becoming a businessperson. It means selling, marketing, financing, competitor research, and business planning. All of this is in addition to pursuing the activity that forms the core of the business.
For some hobbies and hobbyists, these elements are of great interest and may even be part of the hobby itself. For others, they are burdensome and difficult. They are also time-consuming and can be expensive.
For people without a strong interest in entrepreneurship, the non-creative aspects of business ownership can be an insurmountable obstacle. Even the prospect of turning fellow enthusiasts into competitors is enough to turn some people away from monetizing a hobby.
Being the Boss
For some people, this is the very best thing about turning a hobby into a business. For others, it’s extremely difficult. In addition to the business tasks mentioned above, running a small business requires exceptional organizational skills and time management.
Acquiring the necessary business skills and establishing an effective and efficient routine is a daunting process. It can create yet another barrier to continuing to enjoy the activity at the root of the new business.
There is little room for getting lost in a project or grabbing a last-minute opportunity for a new experience. Everything requires careful planning. Being the boss comes with a lot of work and the perks aren’t something that everyone finds valuable.
The Bottom Line
There are great reasons to turn a hobby into a business: autonomy, a passion for the work, and a lot of options for testing the waters. But no matter how attractive it seems to some, the act of turning pastime to profit comes at too high a cost, both personal and financial, for others.
What may work best for a lot of hobbyists is starting very small and deciding if the pros outweigh the cons. A small side business involves fewer resources and losses should the owner decide it isn’t for them. It also builds a foundation if it turns out to be a viable path.
