Best Business Model for Beginners

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Welcome to another issue of Passionate Income.

Today we’ll be discussing the business model more than 90% of “online entrepreneurs” use to break free from their 9-5s.

Let’s dive in.

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I’ll never forget the day I quit my job. To the point that, similar to my birthday, I celebrate November 30th as my personal Freedom Day.

And while escaping the corporate rat race was the one of the best decisions I ever made, unfortunately I knew absolutely nothing about working online.

And because of that I spent years broke, confused and without a plan.

Fast forward to today and I’ve tried everything under the sun, from professional services to drop-shipping to affiliate stuff.

But as someone who’s been in the game for over a decade, I’ve noticed upwards of 90% of people in the online space offer some variation of the same exact thing. Especially in their beginner days.

And today, we’ll breakdown the proven math showing why this one specific type of business model is the absolute best way to achieve freedom quickly.

While most people are familiar with business metrics like Net Profit and Gross Sales, most business KPIs are irrelevant when you’re a total beginner. Instead, the only thing that matters is:

Am I making enough to pay my bills this month?

On the surface, this seems like a simple question. But as someone who’s been doing this for over a decade, this question goes deeper than you might think.

And the reason for that boils down to two main factors:

1. How much do you need to make per month?

2. How many units of your product/service do you need to sell to pay your monthly bills (keeping in mind taxes, business expenses, etc.)?

For the sake of round numbers, let’s say you need to make $5,000 / mo.

And let’s say your first idea is to sell a digital product on Etsy, Gumroad or Clickbank. Since you’re a beginner without a lot of credibility, we’ll pretend your “thing” costs $19.

Using basic math, you would need to sell 265 units to make $5,000 per month. Not a small amount, but nothing insane either right?

Well, let’s dive deeper.

First, Etsy, Gumroad and Clickbank all charge between 6.5 to 10% to sell on their marketplace. Meaning, instead of 265 units, you would now need to sell somewhere between 283 to 294 to net $5,000 / mo.

Which might not sound like a lot, until you realize the average webpage only converts between 0.5 and 2.0%. Meaning, to generate 290 sales, you would need to drive between 14,500 and 58,000 human visitors to your sales page.

In fact, even if you built an audience - which would help you build trust and get higher conversions - even with a 10% conversion rate you would still need 2,900 human clicks per month.

From social media, it’s unlikely more than 5% of people who visit your profile will click your bio link. Meaning to get 2,900 clicks from IG, TikTok or Twitter, you would need 158,000 people to visit your profile each and every month.

From email, the average is 3%.

Meaning, to drive 2,900 clicks, you would need 95,700 real humans on your list. And that’s assuming you’re converting at 10%. If you convert at the normal 0.5 to 2%, that number climbs well into the six figures.

As you can imagine, getting thousands, tens of thousands, or even hundreds of thousands of people into your marketing funnel is no easy feat. In fact, you’d be shocked how many people/pages have huge followings but are still broke.

Now, let’s contrast this with the high ticket business model.

If you’re not familiar with it already, high ticket means you sell some kind of service for $3,000 or more.

As you may or may not know, webpage conversion rates tend to be the same (if not higher) for service businesses. In fact, it’s common for lead generation funnels (which are what you use when selling high ticket) to convert at 5%.

Using our $5k / mo criteria, you would need two clients at $3,000 each. Which would not only cover $5k, but give you $1k extra.

To get two clients, keep in mind most beginners close 10 - 20% of their sales calls. Meaning, you would need 10 - 20 leads to get two clients.

Meaning, if your lead generation funnel is converting at the industry standard 5%, you need to get between 200 & 400 real human clicks to get 10 - 20 leads.

Now let me ask you, what sounds easier:

Getting 14,500 to 58,000 people to click through to your sales page? Or getting between 200 and 400?

Not even close right? Mathematically speaking, we’re talking about a difference of anywhere from 36x to 290x fewer people 😂

Which is why, in my more than 12 years of doing this, 90 to 95% of the people I’ve met who work online sell a high ticket service. Are there downsides?

Yes, of course.

• You have to deal with people

• You have to fulfill on your service

• You have to take sales calls

• The list goes on and on

But compared to being a Wage Slave working a 9-5 job, these hassles are nothing. They’re the “price you pay” for freedom.

Which raises the question: What kind of service should you sell?

Here are the top four services you can sell for $2k / mo (or more) per client:

1. Coaching

2. Consulting

3. Freelancing Services

4. Agency Services

For obvious reasons we can’t cover how to build each one of these in this short email. What we can tell you is that YouTube is jam packed with videos and content on how launch every single one of these.

What matters is picking something, focusing on it for the long-term, and not falling victim to distractions or Bright Shiny Objects (which is much easier said than done).

But either way, there’s a reason 95% of the people you see who are self-employed, and traveling the world (or working remote), sell some kind of high ticket service.

And the reason is obvious: In terms of ease, speed and costs, high ticket offers are by far the best business model for beginners.

💡 Takeaway: Given the median adult salary in the US is less than $3,500 per month, all it takes is two clients paying you $2,000 per month for the Average Joe to break free from their job.

I'll leave you with this quote…

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