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Why You Need to Create Multiple Income Streams
My guest is Dorie Clark. She is the author of Entrepreneurial You. She was called by the New York Times as an expert at self-reinvention and helping others make changes in their lives. She’s a frequent contributor to Harvard Business Review and she consults and speaks for companies such as Google, Microsoft and the World Bank.
Dorie, thanks so much for joining me.
Karen, I’m so glad to be talking with you.
I am too. We’ve known each other on the periphery for quite a while. We go to some of the same conferences and we know a lot of the same people in common, and people kept saying, “Do you know Dorie Clark?” and I go, “I do know her but I don’t really know her.” Then we had the good fortune of being at a conference together where we got to sit down and talk to each other. I have immense respect for you. You’re an author. Your new book is Entrepreneurial You, and I know your past books were Reinventing You and Stand Out. Stand Out was the number one leadership book of 2015 by Inc. Magazine. Congratulations on that. That’s no small accolade.
I know you through your books and through your speaking. You’re a very interesting person to me. One of the reasons you’re interesting is that you’ve got your fingers in a lot of pies, so it’s perfect that you would be someone to write about entrepreneurship given how much you do. I wanted to start with the basics, which is what inspired you to write Entrepreneurial You?
I wanted to write Entrepreneurial You, Karen, because in many ways I wanted to solve a mystery for myself. For most people who are in the entrepreneurial space, you sometimes hear these stories about people who are launching a course or something like that and they bring in millions of dollars. You write it off because there’s so much hype sometimes in the industry and it’s probably totally made up, totally exaggerated. As I got to know more people in the entrepreneurial world in New York and business authors and things like that, I started to meet actual people I knew who were making millions of dollars with online launches, and I thought, “What am I not doing? I thought I was successful, but I have not managed to bring in $3 million in a month. I have to reconsider things.”
Having trained as a journalist, as you did, my impulse was “Maybe I could write a book and then I could have an excuse to interview people and understand.” For me this became a fascinating process because a lot of times people either don’t talk about how they make money or they talk about it, but in these unhelpful chest-thumpy bragging ways. What I wanted to do was create a book that looked in depth at people’s business models so that we could see how do people make money, what are the options, what does this look like? If you want to create multiple income streams in your business, what are the possibilities? How do you implement them? How can a regular person add this to their arsenal so that they can become more successful?
It’s interesting because you say that the concepts in Entrepreneurial You aren’t just for entrepreneurs; you think that they’re for people who have day jobs. I’d love to know because that seems a little inconsistent to me. How could you have a day job and also have these multiple income streams?
We all have nights, we all have weekends. The old paradigm was one where employers viewed it as threatening if people had side gigs that they were working on, like maybe it was a sign of disloyalty or lack of interest or something like that. What I have come to see is that the new breed of leaders understands that having entrepreneurial side projects are a sign of ambition and talent and it’s something that they want more of because this is a group of people that are choosing to do professional development on the side on their own time. Who doesn’t want that kind of person in their organization and on their team?
I can understand what you’re saying. I was at a Fortune 500 company and I was giving a speech. A young woman came up to me and she said, “I love this and it’s helpful for my work here, but it’s also helpful for” and then she told me something she does on the side. I said, “Your company allows that?” She says, “Yes, they encourage it.” You’re right. There’s been a change even in Fortune 500 companies where they’re recognizing that some people may have other businesses outside of work, but it allows them to develop other skills that they ultimately bring back to that main workplace. If someone wants to create multiple income streams in their own business or they want to explore this entrepreneurial endeavor, what are the first steps somebody is going to take? Someone goes, “I have my business, but I do want to multiple income streams,” where do they start?
Sometimes the narrative says, “Do the hot thing. Figure out what’s sexy. You can have your own tech startup,” or something like that. Oftentimes that ends up leading people astray in many ways and away from their core skills. What I would suggest alternatively is for people to look at what folks are already coming to them for. Meaning, for almost everybody, you probably have things within your circle of friends, within your social network, people ask you about a lot and that may have something to do directly with your day job or it may not. Maybe you’re the person that’s such a tech aficionado, you constantly have your friends saying, “Which new model of TV should I buy? Which new model of phone should I buy?”
Maybe you have an amazing fashion sense and so all your friends are coming to you because they want your advice about which clothing to buy or they want to take you shopping with them. Maybe you are the person in your network that is skilled at a particular sport or something; you’re great at tennis, and so people are constantly saying, “Could you look at my serve?” whatever it is. That is often a sign that number one, people are interested in those issues, and number two, they view you as enough of an expert to come to. It is not a stretch that you could begin to turn that into a source of paid income.
Do you think those things have to be all the same? Let’s say that you’re a coach and your expertise in coaching is leadership, but you’re also a heck of a baker. Do you have to have the income streams be related to the same thing?
You certainly don’t necessarily. I wouldn’t advise having seven different income streams and they’re all wildly different. That would probably put you stretched a little bit too thin, but for instance, if you have a day job in one area and you have this side passion that you’re good at, by all means work on that, explore that. As you dive further in, it often begins to suggest areas for you that can spark different things. For instance, let’s say that you do leadership development at your company by day, you’re an amazing baker by night.
You could, for instance, start a side business baking cakes, catering, or something like that, that would be obvious, but there’re also a lot of other possibilities down the road. Let’s say you get a lot of momentum, your business is popping and people will start coming to you, maybe there’s a possibility that you could teach baking workshops for people and make money from the workshops. Maybe there’s a possibility that you’ve gotten good at food photography as a result of your work. Maybe you could sell an eBook about food photography and how to do it right. If you have a cluster of activities, even if it’s different from the main day job, that is an entirely feasible thing to do.
A lot of what you’re talking about, at least so far, is content and content products. I’m getting the feeling as I look through things, do you think we’re burned out on content products? Do you think there’s so many of them out there on every topic possible that that’s not the gold mine it once was for another revenue stream for people, information products?
I’m still a fan of information products in the sense that while it is absolutely true that the field is more crowded obviously than it was ten years ago when it was in its infancy, in some ways it has become “harder” to make money from information products. If you launch something ten years ago when no one had ever thought that there could possibly be an online course about dating or whatever, you could vacuum up money. There were people that got very wealthy from just cornering the market on something. What the competition has wrought now ten years down the line is you have to be high quality. You can’t just be the one guy that does it because there’re 100 guys, there’re 1,000 guys. You have to be both excellent and you have to be targeted in your approach, and, this is a cornerstone here, you have to be very credible as an expert.
I teach an online course called Recognized Expert, which is about how to become a recognized expert in your field. There are three cornerstones to that. It is content creation so that people know what your philosophy is, they know what your ideas are, and therefore can gauge for themselves whether they’re any good. It is social proof, meaning what is your credibility, what are the reasons that you give to people to believe in what you say. Number three, your network, because you need people who know that you’re good, who believe in you, and who are willing and able to spread the word about what you do. If you have those things, you absolutely can differentiate yourself and it’s a much more lasting success rather than this easy fish in the barrel get rich quick years ago.
What are some examples of multiple revenue streams that entrepreneurs could have?
I’ll start by way of example, Karen with mine just so people can get a sense of that. This is something that I discussed in depth in Entrepreneurial You. At the time that I wrote Entrepreneurial You, I had seven income streams. I’m up to nine now. I’m doing a lot of different things, but they’re all related. The goal is to create a flywheel of business. In my case, the nine revenue streams are marketing strategy consulting, which is how I got my start in business. It’s executive coaching; it’s writing books; it’s doing business school teaching, it is keynote talks, it is affiliate income, it’s creating online courses.
For people who might not know what affiliate income is, can you explain that briefly?
Affiliate income is where it comes in handy if you have an email list or an audience of some kind, like an online audience, but it’s where you’re promoting a product that you endorse and then if the person buys it, you get a referral fee at no additional cost.
You get a piece of what the cost of it was.
Affiliate fees, I have multiple online courses, I do live events. I’ve done in-person workshops and retreats and then I inaugurated a couple of different year-long masterminds that I run.
When do you have time to sleep?
The amazing thing is that if you build them up over time, it might sound like a lot to balance, and certainly I wouldn’t say like, “Create nine income streams this year,” but this is something that I’ve been doing very systematically over the past six to seven years. If you are working to build one or at most two new income streams per year, you can essentially layer them on top of each other. Once you master the learning curve of how it’s done, it’s not like it takes a huge amount of extra time or energy for you to focus on that. You can continue adding new ones on top.
One of the points you’re making that is so important is you did not do all nine of those in one year. You added one or two new income streams a year. That’s a critical point because so many people will call me and go, “Here’s my marketing plan and I’m going to add these nine new income streams this year,” and I’m like, “No, you’re not. No one can do that.” An important point is that you layered on top of it and you built it. Are you finding that once you have one in place and it’s going well, that they start to support each other, they start to feed each other?
That’s exactly right. Ideally you want to do a couple of things. The first is that you want to give people options for how to intensify their engagement with each other or with you. For instance, I have a book, let’s say somebody reads Entrepreneurial You. It costs $20 or $25. That’s an accessible entry point for almost anybody. They read the book and some percentage of people is going to be just fine with that. They’ll say “That was enough. I got what I needed,” but a certain percentage is going to say, “This is exactly what I need. I need more of this.” You’re leaving money on the table if you don’t at least offer an option for them to go deeper. That person might sign up for in-person coaching with me or they might join a mastermind, that would be a way that they could intensify.
Also, it’s about looking at these different options because if you’re only offering very bespoke, high-end, personalized things, you’re inherently limiting your audience. That’s not necessarily a bad thing, but if you want to have impact, if you want to reach more people, and if in fact you want to create a better pipeline for you to have those people who can afford the intensive six-month or year-long coaching engagements, then you want to have a $20 thing. Even if somebody a broke grad student, they’re not going to buy the coaching, but they might mention you to their mom or their dad or their professor and that could lead to a whole host of other good things.
One of the important points you’ve made, and it applies to me as a branding and marketing strategist and applies to a lot of the audience, is we tend to get into categories like just the high-end bespoke stuff or just the low-end quick $14.99 and you get a set of steak knives with it. People tend to fall into those extremes and what I hear you saying is it’s good to have these points all over the map, so that people can engage with you at different price points and in different levels of depth. Do you think people already need to have a pre-existing large audience in order to leverage multiple income streams?
No. There are some activities that I would not advise people to undertake unless they already did have one. One prime example would be, “I’m going to throw a conference. Some people think this would be fun,” and maybe it would be great, but if you are trying to get 300 people to a conference, especially if they’re going to pay $500 or $1,000 to attend this conference whatever it is. If you want 300 people at your conference and you have a mailing list of a hundred, how’s that going to happen? You have to get enough people that are able to pay the price, that are interested in the topic, that are free on that date, that are willing to come to that city. It’s a logistical nightmare, and so you need to have a pretty large audience to start with because you’re automatically going to be whittling people down based on these criteria that, “They can’t do this, they can’t do that,” so I certainly wouldn’t do that.
Literally anybody could start a coaching practice tomorrow. This is one of the challenges with coaching and sometimes people make fun of it. They’re like, “Anybody can be a coach.” It’s true but this is where capitalism works. Anybody can be a coach, but you have to be good enough to convince people to pay you. That’s the trick there. This is where becoming a recognized expert, building your brand, such that people say, “Karen Leland, I want to work with her.” That’s where we want to get to it, but you don’t need a big following for that. You can start that with your inner social circle and with referrals.
I do think the market has a way of shaking it out because I was reading, it’s something less than 10% of all coaches and consultants make over $100,000 a year. The market does shake out in terms of who’s got the goods and who doesn’t. I’ve heard you talk about this on panels and we’ve been in groups together and we’ve had this discussion with other people in our field, one of the problems is that anyone can hang out a shingle and say, “I’m an expert at X.” People that don’t know the field, in some ways it’s unfortunate, but you do have people getting taken in and ripped off, paying people who are not giving them good advice. They discover that and then they have to pay to have somebody who does know what they’re doing giving them good advice. I find that to be a rampant problem in this whole entrepreneurial space that we’re in.
Certainly that is a real challenge for people who are not particularly informed and they glom onto somebody. That’s why I’m such a big fan of content creation because sometimes people say, “Why bother? It’s not going to get read that much. It’s so hard to get noticed,” but in a lot of ways it’s missing the point. The point is not to have a post that goes viral and has 100,000 people or a million people read it. That’s nice if you can do it. The point is to establish a body of work such that your prospective clients can see it and can see with their own eyes how you think and gauge whether your approach is congruent with theirs. The truth is, you can’t protect the world if they’re not a savvy consumer or whatever. You have to exercise some judgment, but you can, as a professional, stack the deck in your favor.
If you are a person who is knowledgeable and has integrity, it’s on you to make it easy for people to find you and to understand that about you. If you were competing against somebody that’s like a blowhard, that’s like, “I’m an expert, I’m an expert,” but they have nothing to back it up, if it’s a head-to-head competition and you have a million articles that you’ve written where you lay out your philosophy, your knowledge, they can see you do a video or a podcast where you talk about your methodology, and they can see for themselves like, “She gets this,” they’re going to choose you every time.
A lot of clients have said to me, “Why should I put out content? Then I have to get all these people to see it,” and that’s not the point. People will see it, but the point is it starts to establish your credibility and your point of view and the way you think about things and your methodology. I’ve had people call me up and tell me they were hiring me and when I said, “Why?” They said, “I saw this, that and the other thing,” but what happened was, “I went to your Inc. and I went to your column on Inc.com and I read a bunch of your blogs, and I decided that you were the right person.”
What’s funny is that most of my blogs are not even about branding and marketing. They are all about business, but most of them are not about branding and marketing, so what you’re saying is absolutely true. It gives people a sense of who you are and what you write about and what your point of view is and that’s a good context for why you should do that. You’re interesting because you not only do what you do for a living, but you’ve done some other interesting things. You were a producer of a multi Grammy award-winning jazz album. Would you mind talking about that a little bit?
The album in question was something called Presidential Suites by the Ted Nash Big Band. It was a great experience, but it was something that I attribute entirely to networking. I like to think of it as my Grammy for networking because unfortunately, it’s not my Grammy for musical talent. In the business world, we’ll say “Networking is important,” and we understand intellectually that it isn’t and sometimes we can get business from it and it’s great. Networking and building relationships with people has a myriad of benefits above and beyond getting business, which is a great outcome. Part of what’s great about it is building friendships and having access to opportunities and worlds that you never would have otherwise.
In my particular case, I became friends with a guy named Kabir Sehgal, who is a fellow business author. I got to know him through that and he’s very serious in the jazz world. He’s a jazz musician, he’s a jazz producer, etc. and so I was able essentially to do him a favor. I was able to introduce him to somebody that I thought would be a good person for him to know. I didn’t know exactly what would happen from it, but I was like, “This is somebody that Kabir should know.” I connected them and they ended up becoming collaborators on a project together. Essentially as a thank you, Kabir brought me in as a producer on this other thing that he was doing, the Ted Nash Big Band, and he said, “This has a lot of potential. This is going places,” and sure enough, it did.
What I love about that story is not just the serendipity of what happened, but that that’s the point of networking. I don’t ever go to a conference thinking “Who am I going to meet here who’s going to get me business?” I never have ever gone into a conference thinking that. I go into a conference thinking, “Who are the right people for me to connect with so that I can contribute to them and they can contribute to me in whatever way?” It might just be personally; it might not be business professionally at all. My prayer when I go to conferences or something where there’s networking is always, “Let me meet the right people that I can contribute to and who can contribute to me.” I love that you see the bigger part of it. Dorie, there is something else that you’re doing that’s coming up, which is brand new for you. You are about to start a year-long program learning how to write a musical. I’d love to hear about that.
Technically Karen, it’s a two-year long program, so I’m going to learn how to write musicals. This is a program that I am participating in. It’s organized by BMI, the musical theater publishing company. It’s a fellowship program that they have. It’s by application only and it’s wonderful. It’s something that they do as a way of essentially perpetuating the art of musical theater. Every year they bring in a cohort. I’m going to be part of the next year’s cohort. You apply as either a lyricist or a composer. I’m going to be going through training as a lyricist. I’m excited about it. This is something that I set my sights on in 2016 and I applied and did not get in. One asset that I have is I’m very persistent and so I said, “I have plenty of time. I’m just going to keep applying,” and so I applied in 2017 and was able to get accepted.
In between, you did something brilliant, which is an important point for our audience, which is that you hired a coach.
I thought, “What lesson can I take from my experience in the business world to help?” We get into these ruts sometimes even when we know better. We essentially try to keep doing the same thing and it doesn’t work and we’re somehow surprised. What I came to realize, I had this revelation, I’m like, “I was a philosophy major in school. I have a graduate degree in theology. I never studied musical theater,” and so, rightly or wrongly, even if I feel like I have some lyrical abilities, I don’t know what format to put it in. Literally, I didn’t even know how to format the text in the appropriate musical theater way that they like. I just didn’t know these things, and so I thought, “In the business world, if you want to be a better manager, a better leader, you hire a coach, and I should hire a coach.” A musical theater coach is not necessarily a thing that’s easy to find but I was able to hunt one down and made it happen. Her advice was brilliant. She evaluated my stuff and told me, “This rhyme scheme is not what they’re looking for,” or, “You need to watch the scansion here,” and I’m like, “What the hell is a scansion?” I was able, after multiple iterations, to learn how to create something in the appropriate format that was much better.
I am so looking forward to that journey because, as you know, I was a musical theater major in college and I studied and I’ve tried my hand at writing and it’s very hard. I’m going to watch that journey with great fascination. I have to say you’re a little bit late. I’m older than you, but even if I wasn’t older than you, you’re little bit like the older sister I never had where I just want to follow you around like a puppy dog and do everything you do. I mean that only in the nicest possible way. You’re who I want to be when I grow up. What’s great is the whole way that you look at all of this and you can see this in your life, it’s that it’s entrepreneurial. It’s so perfect you would be writing those kinds of books because you are so entrepreneurial and that’s a rare quality.
There are people that run businesses. I don’t think that many people are necessarily entrepreneurial. Even people that do startups, we call them entrepreneurs and we say they’re entrepreneurial, but oftentimes they are good at just that one thing. Not to take anything away from them, that’s a fabulous gift to have, but to truly be entrepreneurial, which is multi-dimensional, able to take on different things, put your fingers in different pies, explore different things, that’s a different level of entrepreneurship. It’s a skill that more people could learn, but it requires not knowing, being uncomfortable, being willing to try new things, being willing to fail. Being willing to fail is a big part of what you’ve been talking about, like to try and go, “That didn’t work, I’ll do something else. I’ll correct.”
Understanding that failure is a relative thing. I always like to keep it in perspective. You only fail when you stop. For instance, I “failed” the first time that I applied for the musical theater fellowship program and didn’t get in, but I just said, “I will try a different approach.” I literally was just like, “They might be surprised by this, but they will accept me.” I just figured, “If I can’t get in the door, I’m going to get in the window.” It might take a little while to try all the windows, but it will happen.
There are three themes I have in this podcast that I like to ask every guest regardless of who they are or what they do, at the end these three things. The first one is something I called the joy of missing out. People have a huge fear of missing out going on and it creates a lot of problems. What do you think people have a fear of missing out on in regards to their careers that in your opinion they shouldn’t? In other words, what should we have a joy of missing out on in regards to the larger entrepreneurship or career conversation?
It’s something that I talked about in my book, Entrepreneurial You, the whole last chapter is devoted to this, is a question about what your goal should be. As with a lot of things in society and it’s true with entrepreneurship, a lot of times we don’t necessarily interrogate the goals and instead we take them on as received wisdom like, “You want the house. You want the spouse. You want the kids,” and in the entrepreneurial world it’s, “You want the Elon Musk company,” and, “Bigger is better,” etc. Sometimes people feel bad if they don’t have a thousand employees or if they haven’t reached six figures or seven figures or whatever their milestone is. It bears examining that if you want to build a company like that, amazing, great, go for it, but it’s not right for everybody.
We need to be willing to optimize for what we want rather than what we think society wants. I profile my good friend, Jenny Blake, who lives here in New York. The business that she’s optimizing for is one where she leaves work every day at 2:00 or 3:00 PM, she takes yoga classes. She’s managed to build a very successful six-figure business where she can do that. If she worked until 9:00 PM, could she have a seven-figure business? She probably could, but she’s decided she doesn’t want to do that. She’s very comfortable with that tradeoff and has built a great quality of life for herself.
That phrase that she is optimized for that business is the key with that. The other thing that I like to talk about and I’d like to ask people is something I call living beyond the script. You alluded to it a little bit as we were talking, but there tend to be these scripts about what we should do, how we should do things, why we should do things. What do you think is the prevailing script as it relates to entrepreneurship? How do you think we can go beyond that prevailing script?
When it comes to entrepreneurship, one script that certainly I hear a lot about and frankly it prevents a lot of people from exploring entrepreneurship, which is unfortunate, is that the cultural narrative is one about taking the leap. That’s what you always hear in terms of how the discourse is structured. “I’m not ready to take the leap,” or, “He took the leap. He was brave, he was comfortable with the risk.” In my experience, the most successful entrepreneurs are risk mitigators rather than risk embracers. You’re always wanting to try to figure out how do you cap the downside.
A lot of the myths about, “You have to quit your job. You have to leap into the unknown,” is damaging because it forces people to either do that and put themselves perhaps at financial peril if things don’t break their way or for smart cautious people, they say, “I can’t afford to do that. I couldn’t behave like that because of my obligations,” and so they don’t even try. Whereas something, that’s a far better plan in a way that I wish more people thought about it, is that if you are exploring entrepreneurship, it is a good idea to try to build something on the side for awhile, let’s say a year, let’s say even two or three years. Build your runway, test your premise, and only commit to it full time if you wish once you have validated that premise.
The last theme is something I call the everyday artist. A part of what everyone does is art and a part is science. I’d love to know in what way do you consider yourself an artist in your work.
I agree with your premise, although in some ways in terms of my own biases of how I think about it, I probably focus more on the “left brain” type thing. Oftentimes, speaking of cultural myths, a myth that is pretty pervasive about art, which I don’t think is necessarily how “art is done.” The myth of the artist is that, “They’re inspired and they do their work when they’re inspired.” That holds a lot of people up because for instance like with content creation, with blogging, something like that, they’re like, “I have writer’s block or I don’t know. I haven’t felt inspired.” At a certain point you have to be like, “Do you want to get it done?” because you need to get done. I came up as a journalist and when you’re a journalist, there is no room for writer’s block. You have a job, you either have a job or you don’t have a job. No journalist who has a job has ever gotten writer’s block. You are not permitted to have writer’s block.
You don’t have a writer’s block; you have deadlines.
The frame that I like is creativity within constraints in the sonnet model. Within the constraint of a deadline, within the constraint of how a blog post is done, let’s say 800 words, five-bullet points, etc., how do you make something new? How do you make something interesting? How do you make it relevant? How do you make it beautiful? You operate within that constraint rather than the caricature of the artist which is, “Let’s just see what the news is whispering in my ear.”
Dorie, thank you so much.
Karen, it is always a joy talking to you. I’ll just mention for folks if they want to dive even further into the material, I have a free resource, which is the 88 Question Entrepreneurial You Self-Assessment and it helps people think through how to create multiple revenue streams in their own business. Anyone who likes can get it for free at DorieClark.com/Entrepreneur.
Thank you so much for that.
My guest has been Dorie Clark. She is an Adjunct Professor at Duke University School of Business. She is also author of the new book Entrepreneurial You. You can find out more about Dorie at www.DorieClark.com.
- Dorie Clark
- Entrepreneurial You
- Reinventing You
- Stand Out
- Recognized Expert
- Inc.com – Karen’s Inc. page
- Kabir Sehgal
- Jenny Blake
- 88 Question Entrepreneurial You Self-Assessment
About Dorie Clark
Dorie Clark is the author of Entrepreneurial and was called by The New York Times “an expert at self-reinvention and helping others make changes in their lives.” She is a frequent contributor to Harvard Business Review, and she consults and speaks for companies such as Google, Microsoft, and the World Bank.
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Karen Leland is President of Sterling Marketing Group, a branding and marketing strategy and implementation firm. She works with individuals, businesses and teams to enhance their business and personal brands. Her clients include LinkedIn, American Express, Apple, Marriott Hotels and others. Her ninth book, The Brand Mapping Strategy: Design, Build and Accelerate Your Brand, (Entrepreneur Press, 2016) is available online at Amazon.com, Barnes and Noble.com, and in bookstores now.