4 Questions to Clarify If Your Side Hustle Is Worth The Effort
Photo by Nik Shuliahin on Unsplash
Not everyone quits their day job to become an entrepreneur. But almost 50% of Americans have a side hustle where they are practicing and leveraging entrepreneurial talents.
The age of exclusive entrepreneurship is diminishing. The globalization of business and the rapid expansion of resources and information has created an environment where it is possible to be a side-entrepreneur. You can be an accountant and a writer. A librarian and a photographer. The options are seemingly endless.
This newfound freedom of having one foot in and one foot out of entrepreneurship introduces blurred lines that the average side-entrepreneur will need to learn to navigate. It is possible to be a successful entrepreneur on the side. But if you want to escape the all-too-familiar tug of mediocrity and actually find success, you’ll want to aim for clarity and conviction within your side-entrepreneurial adventures.
At the top of the list for the most common questions that need to be answered? How to know when to give up or keep going with a side-project you’ve started and invested in? Give up too soon and you’ll never know what could have been. Give up too late and you’ll have wasted precious time running down the wrong path.
In his book Range: Why Generalists Triumph In A Specialized World, David Epstein talks about the sunk cost fallacy and the difficulty people have in stopping their work after moving in a certain direction for so long. He explains,
“The longer we’ve done something, the more we have a cognitive bias toward not switching, even if we should.”
The sunk cost fallacy is a well-documented behavioral economic study. This fallacy can be difficult to overcome and work through when considering changing or stopping a viable career or altering a course of study after considerable investment, such as dropping out of medical school three years in.
Addressing the sunk cost fallacy can be harder for side-entrepreneurs who’s margins of investment and returns are more narrow or unexplored. Therefore, learning to evaluate when the timing is right to stop pursuing a side-entrepreneur project is crucial for your long-term entrepreneurial development and contribution to the world around you.
For side-entrepreneurs, evaluating the viability of your project should not be driven primarily by questions such as:
is it profitable?
is it hard work?
do I have a following?
While helpful, these questions are not essential to determining if you should give up or continue on your hustle. There are many great side-hustles that aren’t yet profitable or have a big following. And anything worthwhile will require hard work, so you shouldn't hinge your decision on that.
I have a degree in biological engineering, I work as an executive navigator for the CEO of a large non-profit, and I write on the side. Over the last few years, I’ve published over 120 articles and over 200,000 words. I have a considerable investment in this side hustle. In my evaluation, I’ve found that there is a different set of questions that better shapes my understanding of if I should or shouldn't continue my entrepreneurial adventure.
Do you still love the work?
For entrepreneurs of the past, profit was king. If the project wasn't viable financially, it wasn’t worth any extra time or investment. But for side-entrepreneurs, profit isn’t necessarily the most important aspect to consider when judging if you should stop your side-hustle.
Most side-hustles take a significant amount of time to become profitable. You if success or failure hinged on the profit margins, most people would stop their side hustles tomorrow.
Instead, ask yourself if you still love the work you are doing. Passion doesn't put food on the table, but it does make for a more fulfilling entrepreneurial experience, especially when you are just starting out. If you don’t love the work, it’s probably time to wrap up that project and move to the next idea.
Loving the work doesn't mean you’ll always enjoy the grind. Focus more on the law of averages. Do you have more good days than bad? Do you find yourself generally more excited or more dreading the idea of getting back to work on your side-hustle?
Are you still inspired by the value you add?
Loving the work you do and being inspired by the value you are adding to the world around you are different metrics. You can love the work you do, but if you aren’t inspired by the value you are adding, you’ll merely be building your own trophy case. Pride quickly settles on the side-entrepreneurs that cannot clearly see the value they are adding to others.
Great entrepreneurs build out ideas that make the world a better place and add positive value to the lives of real people. If you aren’t inspired by the value that your side-hustle is adding, then you’ll likely start to grow dull to the desires and needs of the average person your project is serving. A lack of inspiration is really a lack of connection and is a good sign that you may want to stop running down your current side-hustle.
How wide is the door to future opportunities?
Some side-hustles are like funnels. Others are like megaphones. Neither type of project is right or wrong, but in general, you’ll want to lean more towards the megaphones than the funnels.
Megaphone side-hustles build up your generalist talents. This means that if for some reason you're side-hustle goes down or you need to stop or shift directions, the majority of the skills you acquired from that project can be transferred over to your next entrepreneurial adventure. Writing is a great example of this.
Funnel side-hustles build up your specialist talents. You start broad but over time and investment, you become more narrowly focused. Developing a new medical device in your spare time could be an example. While some benefits and skills may transfer, the majority may not be applicable should you need to explore another project.
If you are judging if you should give up on your entrepreneurial side-hustle, don’t use this question by itself. Instead, use it as a fence pusher. If you are on the fence about continuing or not, and you think you’ve got more of a funnel project, maybe it’s time to tip the scale and switch to a new entrepreneurial idea. If you’re still working on more of a megaphone project, maybe you keep at it as you can always transfer your skills to another project down the road.
What have you said no to recently in order to keep doing this?
The last question I actively use to evaluate if I should give up on my entrepreneurial side hustle is asking what I’ve had to say to no to recently in order to keep pursuing this entrepreneurial outlet. I keep a running list on my phone of the things I’ve passed on because I didn’t have the time or capital to embark on yet another journey.
Steve Jobs is famous for saying, “Innovation is saying no to 1,000 things.” Most entrepreneurs have heard this line. But in that same quote, Jobs gave another fascinating one-liner when he said,
“I’m actually as proud of the things we haven’t done as the things I have done.”
Saying yes to a side-hustle means saying no to other opportunities. They may not be big neon signs that you are turning down, but it means losing sleep, losing money, losing time with family, or time that could be spent in a hundred different ways. If the things you have recently said no to outweigh the side-hustle you are saying yes to, then it may be time to hang up the towel. If you’re still good with your list of “no’s” in light of your “yes” then, by all means, keep pressing on*.
*One small caveat with this question is that it is probably worth asking this of the people closest to you as well as asking yourself. Your definition of what is “worth the no’s” may be far different from the people who are most directly impacted by your yes
A chest of mixed-up lego pieces
Entrepreneurs rarely if ever have the perfect instructions and all the pieces to make a complete project. Instead, the most successful entrepreneurs have gone to their chest of mixed-up lego pieces and have figured out how to build something that wasn’t on any manual.
Giving up on an entrepreneurial project is not the same as failure. It just means you have more legos in your box to now experiment with. You can be assured that what you learn in one entrepreneur project will connect with other pieces you pick up along the way.
But if you love the work you are doing, if you are inspired by the value you are adding, if the project is leading towards more possibilities, like a megaphone, and you’re good with the no’s you’ve accumulated in your journey, then press on and keep hustling.