In this episode, Don, an experienced attorney and CPA with over 17 years and 8,000 clients on the books, shares how you can grow your side-hustle into a full-time business.
Listen to the episode in the podcast player below, or find it on Apple Podcast or Spotify.
Growing your side-hustle
Daphne:
Hey Don, thank you so much for being here.
Donald:
Thank you for the opportunity. I appreciate it.
Daphne:
We are going to talk all about your best advice on starting a side hustle or making your side hustle your full-time job. But I’d love to hear a little bit about your own personal story, where you really landed in a full-time career, and then how you took that into being your own business owner.
Donald:
So historically I was an attorney CPA. I’m still an attorney CPA. I kind of just drank the Kool-Aid of the baby boomer generation taught me go to school, get a job, buy a house, do all these things. Unfortunately, just the entry threshold for the student debt, the housing, all that stuff was pretty crazy. At the time, no one explained to me that relative to the income, the cost of these things are so insane compared to when our parents were buying stuff. So I kind of went to school, got all kinds of debt, and then got a job, and then realized it was basically impossible to keep up.
Daphne:
So that’s what really inspired you to start a side hustle on top of your job?
Donald:
No, what ended up happening is—so when I didn’t practice law, I did martial arts. And my first side hustle was filming the motion capture for Mortal Kombat for Warner Brothers. And I didn’t make a ton of money, but it was really interesting when I did that side hustle. It was 2009 when it happened. I was barely making ends meet from my job job. But then all of a sudden I was like, “Oh man, I made a little extra this month.” It wasn’t a lot, it was a smaller appearance, but it just kind of sparked something in me that says, “Man, I could go out and help make ends meet by doing additional work.”
Donald explains that a side-hustle can accelerate your financial goal achievement
Daphne:
So your side hustle was basically being a freelance contractor for other corporations. Am I understanding that correctly?
Donald:
That is correct. I was doing freelance work. I went in, I filmed, I made a little extra that month. And man, it just spurred me and it just made me realize like, “Okay, nobody’s coming to save me. The income is not going to keep up with the relative expenses that are out there.” I mean, dude, I could not believe you go to school, you come out, you’re a hundred, $200,000 in debt if you have a professional degree and your parents didn’t save. After that, you got to buy a mortgage, your house. Next thing you know your mortgage is $400,000 or something like that, assuming that you’re able to make enough money to buy a place.
And then you find yourself right back into the cycle when you’re saving for retirement. And then if you have children, you have to start saving for them. So the numbers, they’re so out of whack from the amount that I was getting from my W-2 income that I was like, “I got to figure out a way to make more money.”
Daphne:
When you were starting your freelance business, was it a struggle for you to find clients or to figure out how to pitch yourself as a good fit for them to hire?
Donald:
Absolutely. I kind of got lightning in a bottle. I got really lucky that I had a relationship with someone who helped me film that first one. The first one, what it did is it spawned the idea. It told me, okay, I could go out there and really do this. Once I figured that out, I was like, “Okay, I got to find other odd jobs that I can try to build into other things.” Along that journey… So I probably had eight or nine ideas that I did, but then the 10th one skyrocketed. It was just a very good environment, timing, all this other stuff. I was dabbling with all these other ones, and then one hockey stick.
Daphne:
Yeah, so what do you think were the key factors that contributed to the success of that last one?
Donald shares that he had to try different side-hustles until he found one that worked for him
Donald:
The thing that I really appreciate about learning about the one that actually worked was sometimes, biggest mistake people make is during a good economy, they think it’s them and during the bad economy they blame the economy. It has so much to do with their totality of the circumstances, like the environment that you’re in, the timing.
So what ended up happening is I built all these little boxes, and they were just strikeouts. But the 10th one by accident, I happened to fall into an opportunity where I was dealing with an emerging market, and I was able to get in and solve people’s problems pretty quickly.
The advice I try to give people, and the reason why I really push the side hustle thing is it allows you to be adaptive, but it also allows you to forecast. You get to forecast the needs of the consumer. If you’re big, it’s hard to really forecast, forecast and be adaptable. But when you’re small enough, you can forecast like, “Man, I think people will need X, Y, Z.”
Daphne:
Yeah, I’d love to put this kind of in terms too that teachers might be able to relate to. We had a past podcast episode where we talked all about educational consulting, and in the way that consultants work with school districts and provide the professional developments for school districts, it is a common freelance contract position and something that can be lucrative.
So if you’re trying to forecast a trend, if it was before 2020, if you happened to be someone who specialized in helping schools completely go remote, you would’ve been hot in demand. It would’ve been easier for you to find work. And then right after the pandemic, potentially focusing more on classroom management or focusing on professional developments that helped students readapt to coming back into a learning environment after being in that virtual setting for a couple years.
When you’re looking for side hustles that you think are going to be successful in the future, have you given anyone any specific tips of how to adjust what they’re doing for adaptability? Do you do one-on-one coaching with people or have those conversations?
Donald:
I generally don’t do coaching, and I wrote The Tao of the Side Hustle. We launched to ’21 in the country. You can find us in most Barnes and Nobles right now. I generally don’t do coaching. It is just not what I do. I’m an attorney. I’m a CPA. I coach to the extent of tax and legal, but I very rarely give that type of career coaching.
Donald explains why being an educator is a huge asset when looking to start a side business
However, one of the reasons why I really wanted to do your podcast is everyone out there, please listen to me. If you’re in education, I strongly suggest to you, you broaden the range of side hustles that you guys can do.
Let me be very direct about this. Everything is going to come down to human capital and relationships. Intellectual capital is driven by educators. Dude, if you’re like a car salesman right now, you don’t have to be amazing at knowing what a car is. You just need to be able to educate the consumer.
Consumers have such a massive appetite. They’re so smart right now, and the way they consume and digest information is so different than when we were kids. If you want to sell cars, if you want to sell real estate, if you want to sell mortgages, if you want to sell bonds, most of it comes down to educating the actual consumer. Most consumers, they want to be educated. They want to know their options, and they want guidance for you to help them along their journey. Most of the people that I see out there are extraordinarily self-obsessed. It’s about them, not realizing that they’re there as part of the journey of the consumer.
One of the cool things about educators is they can actually step back, and they have a very high level of empathy, a high level of connecting to the consumer and saying, “Hey, let me help you along your journey.” Because that’s what you’re doing at your schools, you’re helping those students.
It’s wild to me the way teachers are paid. You guys are creating one of the highest value in the system right now. You guys are creating our future. That’s the high level of value add right there. There’s so many professions out there, they’re not actually adding any value. They’re just a parasite to a transaction.
The trick, if you’re able to redeploy some of those calories that you’re using on helping the youth to certain industries, from my perspective, you guys will dominate in the future that’s coming. Because the future that’s coming, you really just need to be able to explain to people what they’re buying or what they’re doing.
Daphne:
And explain it in a way that they feel like they can trust you. They feel like they have a relationship with you. That likeability factor. And I think a lot of teachers downplay how likable they are, how much heart they clearly have, and how honest they are when it does come to communicating and making sure that they’re being as ethical and responsible as possible, while also making sure that there’s no knowledge gaps so that the people are making the most informed decisions. And people pick up on those cues. They’re able to really see, “This person is giving me all of the necessary information and they have my best interest in mind.”
Donald:
That’s right. That’s right.
If you’re a teacher, implied in your label, you are selfless in your behavior and you’re teaching the other party. Now, the only thing you need to do is translate that into an area that provides a more lucrative reward. Let me say it like that.
Because there used to be this barrier. If you wanted to sell cars, you had to be knowledgeable on cars, and truing up to that knowledge level, it was a very steep climb. If you wanted to be a real estate agent or a real estate broker, you really needed to be a real estate person, and truing up to that knowledge level was very hard.
Today’s model, truing up to those levels is not as difficult as people think. You can really onboard people quickly, but it’s really difficult to teach people that emotional intelligence to connect to consumers the way teachers do it quite naturally.
Daphne:
Yeah, absolutely. I 100% agree, and it’s why the people really do value teachers’ transferable skills. It’s just our responsibility to also learn how to translate those skills to show our value with confidence, and that we understand the new types of positions or the new types of roles that we’re going into.
I’d love to hear a little bit more about making sure that you have financial stability when you’re going to take a side hustle to a full-time hustle. That’s something that’s always been really important to me to talk to teachers about, because I know that there are so many teachers who do have side hustles.
Donald breaks down why you should slowly transition instead of quitting your job to start your business
But do you have specific milestones or benchmarks that you think that people should achieve before quitting a full-time job to focus on a side hustle full-time?
Donald:
Yeah, okay. First of all, anybody out there, if anybody says, “Quit your job to start your business,” don’t do that. That’s bad. I’m a transitioning person. Macro level, I’m a big Adam Smith, Wealth of Nations. There’s three ways you make money, salary, profit, and rents. Salary, you got a job. Profit, you own a small business. And then rents, you got some sort of appreciable property, real estate or the stock market, something like that, right?
In Tao of the Side Hustle, the book that I wrote helps people transition from salary to profit. It helps people slowly transition to starting a business.
Before you do that, find out what your goal is. Recently I met a teacher, and her goal wasn’t to transition to a business. She actually really liked her job. She needed to make some extra money. And she had a really interesting business. She had an exact dollar amount that she wanted to make extra, and she produced a product for a very specific market, and got to that number and then stopped. So she wanted to make X dollars and she got there. “I don’t want to transition. I like my job. Boy, it would be nice if I had an extra 2,000 a month.” That’s it, right? That was her thing.
I’ve met other people who had much more ambitious dreams of transitioning. They absolutely hated their job, and they just needed to figure out a way to get out. For those people, I believe it’s better to do it over a long-term because the long-term. . .
I’ll give you an example. I want to tell you one thing that I do that most people, it’s not intuitive. I live my life one year in arrears financially. What that means is I don’t touch this year’s money until after next year’s. The reason I do that is it gives me a runway to forecast changes in the market. So applied, what that means is 2023, I keep all of the money in my bank account until after I file my tax return in 2024. So April’s the tax return, you extend to October. That means November, I could actually start spending the money for the prior year. Today, right now in 2023, I’m spending 2022 money. And that helps me adjust in case there’s fluctuations in the market.
The way I was able to do that, live my life one year in arrears is I did this super slow transition from job to small business. And what I did is in the very beginning, I just never touched the money until the subsequent year. And that allowed me to be so resilient during changes in the economy.
So for a specific application, what I ended up doing, because I had a little bit of a different goal than the lady that I just suggested where she just had a specific benchmark number, I wanted to quit my job. I hated my job. Everyone was super mean, and I just wanted out.
So it took me eight years to get there, and basically what I was doing during those eight years is I was doing a bunch of trial and errors with things that didn’t work. I found one that worked. It ended up working out very well, and I waited until I knew I was matching my salary, and all those years I was banking in case I needed to dip in if something happened to my business.
Daphne:
Yeah. I started my business in 2017, and I did not leave my full-time position until 2021. And it was just watching the markets, because some things are seasonal. You don’t know if you just happen to have a good year or if it’s something that’s going to be sustainable in the longterm. And I actually really enjoyed my full-time position, so it was a hard decision for me where it was, I like both of these things, but I’m no longer able to do both of them well. And that’s a very fortunate situation to be in a very hard decision, but I always err on that side of caution.
And I also love that you gave that story of the teacher who just had an income level that she was looking for, an additional supplemental income level she was going to do, and then she was going to stop. Because I think what’s really happened with hustle culture is we keep pushing the benchmark further, and further, and further, and then we forget what we were initially really looking for.
Donald explains the pitfalls of scaling your business too quickly
If you’re looking for your time back and you’re looking for a little bit of additional income, well, you don’t want to be working 24/7 on this indefinitely because you keep pushing the benchmark further, and the goalpost keeps moving into a different direction. And so sitting down and making one year, three year, five-year goals of what does success look like for me in this side hustle endeavor is a really good strategy to keep realigning yourself and realizing, “Hey, did I make the number that I was supposed to make, and now I am doubling it just for my own personal ego or validation, and I’m burning myself out?” Or is that working towards that goal that I had already aligned myself with?
Donald:
That’s right. I made that mistake. I got drunk off the hustle culture Kool-Aid. When I really started growing exponentially and I started reaching what I thought relative from my perspective to be insane heights, I didn’t realize all the additional baggage that comes with it. First of all, the more you make, the more you’re taxed. The more you make, the more labor costs you have. The more you make, there’s more things you need to just be juggling.
And I found myself in a position where I had 10x’d my income and I was absolutely miserable. It was the worst point in my life, and I had all this stress on me. Probably 2021, I started making moves where I have a very specific number that I’m going for. I want to hit that number. I want to spend the rest of the time with my family. If someone’s better than me, God bless them. I wish them the best, but I retracted. I hit this crazy height, and then I retracted right back down because I didn’t realize how miserable I was going to be.
Daphne:
Yeah, the scaling too quickly is something that can really hold you back, and especially even I’ve listened to another podcast, it’s the Smart Passive Income Podcast. There was a really good interview and I’m so sorry I can’t tell you the interview number off the top of my head, but it was someone who was talking about he didn’t want to scale. He didn’t want to get to the point where he had to start hiring a team, and outsourcing, delegating different responsibilities, because that was a new skill that he was going to have to learn to add onto the plate.
And his goal was, how do I make just enough money to have freedom with my family? And once I start adding these different layers into it, it’s going to be more complex. And I think that there’s arguments on both sides, but that’s where it really comes down to, what does your side hustle look like? What’s going to be the best fit for you? Are you exchanging time for money? Is it something that’s going to be a little bit more passive? What really is the direction you’re looking for? And then working your way strategically towards that.
Donald:
To all the people who out there are listening, if I were in your shoes, if I could do it all over again, I would look at super small incremental growth so you could make these decisions along the way. Your first six months, make an attempt to make just enough to pay your car bill. Then your next six months, make just enough to pay your car bill, put an election savings. It’s a very, very small. . . So I’m Korean, I’m not Japanese, but in Japan there’s a word that’s very popular. It’s called Kaizen. It’s very small incremental improvements, like 1% today.
And my problem is I stopped listening to that fundamental, I scaled super quickly, and it was just awful dealing with that. I’m glad I did it, because in doing it, I had the opportunity to experience the ups and downs of it. And I realized that I don’t like that life at all, and then I found a nice little happy medium of where I’m happy. But if I were the people in the audience, small little incremental growth, and that will allow you the runway to make all these decisions and calls.
Daphne:
Yeah, that’s such good advice. What other misconceptions do you feel like people have about side hustles or full-time entrepreneurship in general?
Donald:
See, I feel like it’s funny. People use the word side hustles. So before I was a lawyer, I was a CPA. I’m still a CPA, but I only practice as a CPA at one of the big accounting firms. And most big companies have a line item, a category called research and development. That’s where you get to experiment and dabble to see if things work. From my perspective, I always viewed side hustles as being a research and development phase, right? You’re testing a business out to see if you can move it from side hustle to stabilized scale.
I think a big misconception people have is that side hustles, from my perspective, is you testing out different things with very minimal risk exposure to see if it’s something that you’ll have an appetite to see if it works. And one of the things that I think people need to exercise extreme restraint on the entrepreneurial stuff is be cautious of a lot of the stuff that you see online. When you see people very, very flashy, you got to really watch what they’re selling you. Guys, I am not selling this type of stuff to you. I’ve worked really hard to kind of stay below the radar. The only reason why I’ve recently started coming out is because of my book. But I view my value proposition as more of as a tax and legal expert than I do as someone who’s a business coach.
The only reason why I share the story is because it’s super quirky, and I think it gives a blueprint of things I did well and things I’m really messed up on. But the thing I would be very cautious of is if any entrepreneur is out there, and they’re being too flashy, I would exercise extreme restraint on what their business actually is.
Daphne:
Yeah. And I know you probably don’t want to give examples, but I’ll go ahead and give some examples. If there’s somebody who their entire Instagram feed is them working on a computer on a beach, and they’re just saying, “This is what entrepreneurship looks like, here’s me living my best life. And I get to work from wherever I want,” working from wherever you want, absolutely. It’s not necessarily the reality of it. And those are usually just made to feed the algorithm and make people feel jealous, and even inspires that hustle culture of as we’re recording this podcast episode, the reason why we’re not on video is because I don’t have time to even flat iron my bangs or do my makeup.
Owning a business is not as glamorous as people sometimes like to show, and it sometimes ends with really late nights. It sometimes ends with doing work you don’t necessarily want to do. And it sometimes ends with not having a flashy paycheck that you’re going to necessarily put all over Instagram of, “This month I made X amount of dollars doing this.”
Some of those are absolutely true, and they’re wanting to show you the possibility. Many of them unfortunately, are becoming more and more popular that you need to have a really discerning eye when you’re looking at that type of content of, where’s the proof? Are they actually teaching you actionable advice, or are they just teaching you to be jealous of a lifestyle that may not even potentially exist on the other end of that screen?
Donald:
That’s right. A lot of these guys, they’re selling tickets to conferences. They’re selling platform access, or coaching access, or something like that. If anybody’s too flashy like that, that is not what entrepreneurship looks like. Entrepreneurship looks like you find the reason that motivates you, your why. For me, my why is my family. I want to be with my family. Then you set a goal of that why, and then you take actions. You try to use side hustles to get to that goal, and that’s it. It’s real simple. Anybody’s showing you too much stuff, like, dude, some of that stuff is wild that I see on the internet.
Daphne:
Yeah, definitely, I’ve seen some very misleading claims about how much people make with educational consulting. And I personally worked as an educational consultant, not for school districts, but for a Fortune 500 company. And I can tell you that the salary that they were saying that they got as an educational consultant was four times what I was getting at a well-known company. But if you do some research and you look this person up, you can’t find any actual ties to them working with the companies.
So use a gut check, see if they’re credible, if you can find real people who have worked with them, and just look for that actionable advice that can help. And I really want to go into your book, The Tao of the Side Hustle, just to learn a little bit more about what people can expect to learn from your book, because that’s ultimately why I had you on.
Donald shares why you should stabilize and then scale your side business
So what are some of the top things that you teach in your book?
Donald:
So if we’re going to be macro level, Tao of the Side Hustle is a blend of Buddhism, martial arts, business. It tries to bring it all together so you can have some sort of vehicle to get you to your goal.
I believe Adam Smith, Wealth of Nations. There’s three ways you make money: salary, profit, rents. In the United States, there’s three places. Wealth is stored in retirement funds, real estate, and small businesses. You see how there’s an overlap when it comes to businesses?
The reason I wrote Tao of the Side Hustle, it’s a structured blueprint of going from salary to profit through a three-step process of side hustle, stabilize, and scale. And basically what I tried to do is I tried to itemize the very specific factors and key tools that I used when I was going to scale. Not just me, listen, this is my 18th year as an attorney. And before I was an attorney I had six years as a CPA, so I’m 23 years in the game. In total, I’ve probably worked with over 8,000 businesses in let’s call it the wealth field, the developing of wealth, because ultimately small businesses are a form of wealth. And the biggest hurdle I see people run into is sometimes to make that investment and to create a small business, the risk exposure is insane.
For example, my family was big in the restaurant industry, in the equipment. And if you’re going to start a ghost kitchen or something like that, the prices of some of this stuff can be insane. Now there are some people who have the appetite for that sort of risk exposure. Some of us not so much, right? Some of us can slowly creep in and try different things, and Tao of the Side Hustle kind of shows you how I walk through that.
Daphne:
I love that, and I love that you are able to kind of blend it with some of your other passions as well. I feel like it is really interesting to read things that aren’t just the cookie cutter, “Here’s the top five ways you can make a side hustle,” and so I’m very excited to get my hands on your book and dive into it. Thank you so much for being here, Don, and just sharing all this really great information. It’s been a pleasure.
Donald:
I just want to say one last thing, Daphne. I really appreciate what you do. To all the educators who are out there, we see you, we hear you. It’s awesome what you guys do. It’s very unfortunate that there are constructs out there that make your job so difficult, where we should be trying to make your job easier.
With that said, the training that you have is transferable to basically every field right now. If you check out every field, emotional IQ has basically moved to the top, because AI and all this other stuff has made bridging the knowledge gap much easier. To all those people in education, we love you, we appreciate you. If you do not feel the love and appreciation back, consider redeploying some of that energy into an area that will give you that sort of respect.
Daphne:
Great advice. Thank you so much, and really, really, really happy that you were able to come on the show.
Donald:
Cheers, everybody.
Mentioned in the episode:
- Find Donald’s book here
- Our career path quiz at www.teachercareercoach.com/quiz
- Explore the course that has helped thousands of teachers successfully transition out of the classroom and into new careers: The Teacher Career Coach Course (If you are a Teacher Career Coach Course member, you can also sign up for our one-on-one Career Clarity calls.)
