If there’s one thing all designers can agree on, it’s that client work can be draining. Dealing with deadlines, scope creep, cantankerous personalities, unrealistic expectations, and all the other challenges of one-on-one work is stressful sometimes, no matter how high your rates.
Creating passive income streams can help mitigate this stress by providing a financial safety net so you can reduce your dependence on client work. This will allow you more freedom to take time off if you’re burned out or turn down clients who don’t seem like an ideal fit.
The truth is that client work isn’t right for everyone. You may want to reduce your dependence on client work—or you may want to cut it out together. It is 100% possible to build a successful design business that doesn’t involve any custom design work at all. I know because I’ve done it.
If you’re not familiar with the concept of passive income or you associate it with bro marketing and sleazy sales tactics, I would encourage you to read my definition of passive income.
Ready to generate passive income in your business? Here are four passive income ideas to get you started!
1. Affiliate Marketing
Affiliate marketing is one of my favorite passive income sources because it’s so easy to get started and you don’t have to develop your own product to sell.
What It Is
Affiliate marketing is when you promote someone else’s product using a special link. If someone clicks through your affiliate link and makes a purchase, you earn a commission for that sale. The commission is usually a percentage of the total sale amount, though some programs go with a set dollar amount.
How It Works
There are different ways to promote affiliate links. Some are more passive than others. For example, if someone asks for a software recommendation in a Facebook group, you could give them your affiliate link (group rules permitting, of course). The problem with this approach is that it’s a lot of work for a small result.
That’s why I prefer to do affiliate marketing through my blog. I create high-quality content with a solid SEO strategy and allow Google to bring me affiliate sales on autopilot. In 2021, this strategy earned me over $35k in affiliate commissions with very little time and effort.
Here’s an example. I wrote this comprehensive guide to Flodesk almost two years ago. It took me one day to write and has generated over $7k in revenue so far.
Not every affiliate post is a home run. I have affiliate posts that have generated $10k or more of revenue and posts that have generated nothing at all. Either way, the effort is worth it because that content is also valuable to my audience and helps bring more traffic to my website.
You can’t really lose when it comes to affiliate marketing through your blog. One way or another, it will add value to your business.
There are two major downsides to affiliate marketing.
You don’t own what you’re selling
You don’t set the commission.
The company could discontinue the product at any time or change the commission, which means your income could change at any time. So while affiliate marketing is great, it's probably best not to rely on it as your primary source of passive income.
WantWant to learn more about affiliate marketing? Check out my friend Christy’s course, How to Make Money with Your Blog. And yes, that is an affiliate link.
2. Squarespace Plugins
If you have the creativity, problem-solving ability, and coding skills necessary to create Squarespace plugins, it can be an amazing way to earn passive income.
What They Are
A Squarespace plugin is a piece of code that allows users to add a specific design layout or functionality to their website—something you can’t do with Squarespace alone.
How It Works
Typically, Squarespace plugins are delivered as copy-and-paste code with a video tutorial that shows users how to install the code correctly. The more unique the style or functionality the plugin provides, the more popular it will likely be. Everyone is looking for a way to make their website stand out from the crowd.
The Pros + Cons
You have to know how to code in order to develop plugins (or work with someone who does). And one of the biggest challenges of creating plugins is the customer service involved. If Squarespace changes its API, your plugin could break, causing a lot of customer service emails to come flooding in.
Skilled developers are more difficult to find than your average run-of-the-mill designer, so if you can solve a common problem using code, you can make a killing selling that solution as a plugin. That’s the biggest advantage of opening a plugin shop.
3. Squarespace Templates
Premium Squarespace templates are all the rage. They offer DIYers a quick and easy way to build a beautiful website on a budget.
What They Are
Squarespace templates are pre-made website designs that can be sold repeatedly. Customers can completely customize the templates to fit their brand.
The great thing about Squarespace templates is that they offer DIYers an affordable alternative to custom design and figuring out how to build a website from scratch. This happy medium is one reason why Squarespace templates are so popular right now.
How It Works
In my course, Scale with Templates, I teach designers how to build a successful Squarespace template shop using my signature 4-step framework. Here’s the quick version.
Step 1: The Build
First, you have to plan and build your template. This is the easy part for most designers. Aside from the actual design part, this step involves things like identifying your ideal customer and USP (unique selling proposition) and outlining your template.
Step 2: The Delivery
Next, you’ll need to decide how to deliver your template and what resources to include (like a course, video tutorials, workbook, etc.). This step also includes working out the details of your customer service policy and any automated emails you want to send customers after they purchase your template.
Step 3: The Sale
To sell anything, you need a solid system. At this stage, it’s time to price your template, design your sales and checkout pages, set up any integrations you need to connect everything and make sure you have all your legal bases covered to sell a digital product.
Step 4: The Launch
Finally, plan your launch and ongoing marketing strategy. Do you want to start an affiliate program? Focus on social media, SEO, or ads? Where will you list your template? These are all questions that need to be answered.
The Pros & Cons
Building a successful template shop takes a lot more time and energy than writing a few affiliate posts. That’s the biggest downside. But it’s definitely worth it in the long run.
Here are a few benefits of selling Squarespace templates:
Website templates typically sell at a higher price point than plugins, social media templates, etc., which means you don't have to sell as many to generate lots of revenue.
The Squarespace template market is still relatively small, which means there's plenty of room to carve out your own niche.
There are lots of opportunities to upsell template customers on premium services (like template customization), which means added client revenue as well!
You can also downsell potential clients who can't afford your services rather than lose them altogether.
Selling website templates is a natural fit for web designers because you already have the perfect audience!
I started selling Squarespace templates in April 2020 and it completely changed my business. In fact, I was able to quit client work altogether in January 2021 because of the added revenue from my template shop.
Want to learn more about how to build a successful template shop? Check out my course, Scale with Templates!
4. Graphic Design Templates
If building website templates is too time-consuming and you don’t know how to code, graphic design templates are a great alternative to start with. The design process is usually pretty quick and you only have to film one video tutorial showing customers how to customize the graphics.
What They Are
Graphic design templates make it easier for customers to create stunning:
Social media posts
Course or webinar slides
You can create templates for your existing client base or fellow designers if they make up a significant part of your audience.
You can create templates using programs such as:
How It Works
The great thing about graphic design templates is that they’re super easy to design and deliver. No coding, extensive video tutorials, or time-consuming website builds required.
While graphic design templates are fast and easy to make, they also tend to command a lower price point than website templates. This means you’ll have to sell more to make a real impact on your bank account, which might require you to put more effort into marketing. This is also a competitive space, so watch out for that.
5. Online Courses
If you have a lot of knowledge to share and love to teach, creating an online course may be the right path for you. I launched my first online course in 2021 and it has been such a rewarding experience!
What They Are
Online courses are a great way to serve a larger audience and increase your income. By teaching people how to do something, rather than doing it for them, you empower them with knowledge and provide a more affordable alternative to one-on-one work.
Courses can take different forms. There are written courses, audio courses, video courses, and courses with interactive elements like quizzes and gamification. While video courses (with accompanying workbooks and downloads) are most popular, there’s no wrong way to create a course.
How It Works
In many ways, creating a course isn’t all that different from building a Squarespace template. There are four main stages of the course creation process.
Stage 1: Market Research
If you want your course to be successful, you need to teach something your audience actually wants to learn. Market research doesn’t have to be complicated. Come up with a few course ideas and send an email to your list asking for feedback or post a poll on Instagram stories.
Once you’ve decided on a course idea, set up a waitlist signup page with an automated email sequence. This sequence can educate people about the topic of your course and nurture leads. At the end of the sequence, ask your subscribers what questions they have about the course topic. The replies you receive will serve as inspiration as you’re planning your course content.
Stage 2: Create the Course
Outline your course modules and lessons, and decide how to want to deliver the content (video, audio, text, etc.). Then it’s just a matter of creating the course content. This is the most difficult and time-consuming part of the process...but it will feel so good when you’re done!
If you’re planning to film your course and you’re not sure what tools to use, here are my recommendations.
- Canva or Keynote (for course slides)
- Screenflow (for recording and editing video
- Logitech Brio 4k webcam* (if you want to film yourself)
- Blue Yeti Nano* (for audio recording)
Stage 3: Setup the Tech
The next step is to choose a course platform and set up your sales system. Personally, I love how fast and easy it is to set up a course in Podia* but Teachery* and Learn+ (a ThriveCart* platform) are also great options.
I use ThriveCart* to process orders because it makes it so easy to design high-conversion checkout pages but you can use the built-in checkout system on whichever course platform you choose. Zapier is a useful tool for connecting ThriveCart to third-party course platforms.
Step 4: Plan the Launch
The final step is to plan your launch. I recommend building your email list and course waitlist ahead of time so you have more of an audience when it comes time to launch. Scheduling your social media posts and launch emails ahead of time will make launch week a lot less stressful.
You don’t even have to do a live webinar if you don’t want to! My first course launch brought in nearly $30k total between the limited founder’s launch (which sold out in less than 25 minutes with just one email to the 200 people on the waitlist) and the 5-day public launch. You don’t have to use the same marketing strategy as everyone else. Do what works best for you!
The Pros + Cons
The biggest downside to developing a course is that it takes more time and energy than anything else on this list. And filming course videos can be especially draining for introverts. I’m in the middle of filming a new course right now and as much as I love teaching, I can’t wait to be done!
The upside is that launching a course will give you the biggest cash injection. Digital product sales tend to be fairly steady but a course can easily bring in multiple five figures short term during a live launch and boost your cash flow. And you can also bring in steady sales between launches with an evergreen sales funnel. It’s the best of both worlds!
There’s always time and effort involved in creating new passive income streams but if you do the hard work now, you can reap the benefits for years to come. Whether you want to build a side hustle to your main client work or replace one-on-one work altogether, these passive income ideas will help you grow your business and create more financial security.