This transcript was generated from the episode audio and may contain minor errors.
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Hello, thanks for tuning in today. My name is Chris Guillebeau, this is Side Hustle School. Got a question for you from a listener. They're wondering which is better direct or indirect income. Okay, so what does that mean?
Well, there are many, many different ways to get paid. All right, we've looked at lots of different business models. Today, you know, this listener is gonna help us make that distinction, you know, between direct and indirect income. And these terms aren't always used, so I'll define them for you more specifically in my answer. Basically, the business model our caller is developing is either a B2B or B2C operation, depending on whether they choose to get paid mostly through affiliate and advertising revenue or through selling to consumers themselves.
And by the way, this isn't two different business ideas. Okay, that's the key point. They've got one business idea, they're just trying to figure out which revenue model to choose, right? Or which revenue model to apply, let's say. So if you've settled on your idea, depending on your project, you might have one more big choice to make.
Let's see what we can do to help out with this particular situation. The question about direct or indirect income and my answer coming up after the break. [Music]
Hi there, Chris, this is Shannon. And I've been listening to the show for a couple of years. I'm deciding between different business models and have come across something I don't think you've talked about.
In the side hustle book, you drew a distinction between a product business and a service business. But here's what I'm wondering. For both of those categories, there are also different ways to get paid. I want to start a business that publishes information on sports betting. In this business, I could get paid through affiliate commissions and advertising or by selling a guide or some other kind of product directly to my visitors.
But let's imagine it's one or the other. Both options are services. But is it better to get paid by an advertising network or directly by customers for something you sell? Let's also assume the money is the same in this situation. Thanks for your advice.
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All right, great question. Thank you so much for the question. Thanks for bringing this to our attention. Can you do both? Let's start with that.
In some cases, yes. Like you absolutely can do both. And that's very common. However, it tends to be the case that one model is primary. And the other one is just like something else on the side.
Your side-side hustle. So I think it's actually really good to think about your idea in terms of the primary model. And as I mentioned, one is B2B, business to business. One is business to consumer, B2C, in terms of revenue. But in both cases, with this idea, the end users are the website visitors who are coming to learn about sports betting.
So it's your job to serve those visitors and which way are you going to get paid? I think you make the decision by thinking first about their needs, thinking about these people, these website visitors, your prospects, and surveying what's out there. Now, this industry, the sports betting industry, sports gaming, it's sometimes called, it's very competitive, extremely so. But that's because there's so much money in it. I was thinking about this like I sometimes talk about how with hobbies like golf, they can be a good side hustle because spending money is required.
Like you can't participate in this hobby without spending money. Well, this hobby, sports betting, that's even more extreme, right? Because if you want to bet on sports, you need money to do so. So there are a lot of companies, these gaming companies that will pay a lot of money in affiliate commission. It can be really lucrative.
Sometimes it's several hundred dollars per referral because they really want to acquire customers. So that is definitely a natural fit, at least one fit. As for going the other route, the more like direct selling route, there are options there too. Because people who are into sports gaming, they tend to be pretty fanatical about it. They want all kinds of knowledge and tools.
If there's something you could make and sell directly, like if you have some expertise or specific knowledge, you could then argue that your resources are worth whatever price you're paying because you're not beholden to any of those big companies that other sites are affiliate partners with, right? Your goal is to help your customers get an edge of some kind, even if that involves giving some information out that the big companies might not want, just for example. So as I said, you could end up doing both, but it would be better upfront to have an idea of which one you want to focus on because that's going to affect your content. It's going to affect just the website design and layout. It's going to affect like what is the goal of your website?
So you want to be really clear about that and not just kind of split things down the middle. I think if you do that, that's a good way to start. And then over time decide, do I want to experiment with the other model? Or is it best to just kind of stick with one? That's what I think about that.
Good luck. Let me know how it goes. Listeners, there's something you're wondering about. If you've got an idea or something you're working on, sidehustleschool.com/questions. We will continue to feature them.
I also love to hear updates on how things have gone after you've been working on it for a while and maybe made some adjustments. So let us know, we can share it with our community and most importantly, take care of yourself, do something for yourself today. I hope you'll come back again tomorrow. My name is Chris Guillebeau. You are listening to Side Hustle School.
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From the Onward Project.
