When I say the words “diversify your income streams,” does that make your heart freeze? Your hands turn into raptor claws? Your brain spit the words “I don’t know what that means!” out of its core?
Here’s the deal. An “income stream” is just a way that you get paid cash money. If you have a day job, that’s an income stream. If you sell needle-felted cat portraits (OMG! Have you watched Cat People on Netflix? Fascinating!), that’s an income stream. If you have a freelance web design service, that’s an income stream.
Got it? Good. Let’s move on.
As you get serious in your planning for your creative business, you’ll want to develop several different income streams. That is called “diversification.” By forming income streams that rely on the needs of different audiences, you begin to build a teeny-tiny safety net for your income.
Let’s say you create those amazing needle-felted cat portraits. They become hugely popular and you are overwhelmed with business. And then, people stop ordering your adorable kittens. (Like that could happen! Have you watched the show yet? They are astounding!)
What do you do?
This is the point where a diversified set of income streams saves your ass. Instead of focusing all of your energy on one thing, build your business to deliver at least three things. Making this one change allows for stability.
So, find three things that you want to do. Three different skills you can sell, three lines of products, or three different items to make.
Three is important because, just like a three-legged stool, having three of those income streams gives you the stability you need to stand. A two-legged stool will just fall over. You need that third leg to keep you upright.
Let’s go back to the needle-felted felines which aren’t selling. The person here could have several options. She could expand to create needle-felted pups and needle-felted rabbits as well. Perhaps, in addition to needle-felting, she could create drawings and watercolors of pets. Or maybe she goes completely outside of the pet portrait realm and, in addition to those, self-publishes erotic novels and does bookkeeping for a neighbor.
(I’m not saying that this lady does any of these things. I’m just supposing for the sake of this piece. Her gorgeous needle-felted kitties are super-popular and give her an artistic satisfaction that I’ve rarely heard described. Episode three of Cat People, people!)
Your possibilities for diversifying your income are only limited by your imagination and the time/space continuum.
By developing three income streams, you build a business that can survive the fluctuations of fashion, the economy, and your own need to grow.