Work is traditionally geared toward making a living, while leisure is spent free from obligation. Rather than maintaining distinct boundaries between work and play, however, some actively blur the lines by monetizing their hobbies.
Many of the world’s most glorified entrepreneurs built their businesses from a hobby. Bill Gates spent his free time coding computer programs at school when he was 13. Steve Jobs and Steve Wozniak met at the Homebrew Computer Club, designing the first Apple computers as a hobby and without intent for profit. Mark Zuckerberg started building Facebook as a hobby while in college. Walt Disney exhibited a passion for drawing from a young age, selling his sketches to neighbors. Coco Chanel started designing hats as a diversion in her leisure time—and the list goes on.
The path of “hobby entrepreneurship” may be more common than you think, with 26 percent of new entrepreneurs in the U.S. citing that their business stemmed from a hobby, according to the Panel Study of Entrepreneurial Dynamics II, a representative sample of U.S entrepreneurs. But why do some hobby entrepreneurs thrive by monetizing their hobbies, while others burn out?
Starting a hobby-based business initially seems like an ideal job—the best of both work and leisure, earning money doing what you would otherwise do for free. But hobby monetization introduces a cacophony of voices that influence entrepreneurs’ relationship with their craft. Based on my research on hobby entrepreneurs and the psychological underpinnings of hobby monetization, there are 3 M’s that serve as the voices of hobby monetization. Which will you listen to?
How much do you need money from your hobby? Hobbyists often dedicate significant time and money to practice their chosen hobby, so negative financial returns are the norm. Once money is introduced into the equation, however, focusing on financial reward can subconsciously undermine the original motivation, shifting attention away from enjoyment and toward what will make money.
Most entrepreneurs maintain full-time employment while working part-time on their venture. These hybrid entrepreneurs are able to test the waters instead of jumping all-in at once. Alternative income sources, whether from other work, a spouse’s employment, family and friends, or savings, may also provide a safety net to ease the financial pressures associated with monetizing a hobby.
As the venture proves a fruitful source of income, hobby entrepreneurs should consider tradeoffs associated with increasing their time, commitment and resources.
How much are you willing to listen to the market? Some hobby-based businesses produce products or services that naturally align with market needs without extensive tailoring, but the two are unlikely to align perfectly. Reading, playing a sport, or traveling, for example, are unlikely to translate directly into products or services that others find valuable and will pay for. Yet, teaching your hobby, selling products or services related to your hobby, or utilizing skills gained through practicing your hobby, may create value.
Pivoting toward market demands often results in drastic changes in the offerings and focus of a venture. Be wary of losing sight of your passion, and keep an eye on your original motivation as you balance personal desires with market rewards.
Monetization can help hobby entrepreneurs share their craft with others, providing a fulfilling sense of meaning and purpose. But monetization also opens up your hobby to feedback—from investors and stakeholders, friends and family, customers, and the community associated with your hobby, all with their own personal views on how you should approach monetization, or whether you should at all.
Passionate entrepreneurs often view their ventures as metaphorical “babies”—as a reflection of their identity. For this reason, it can be extremely difficult not to take feedback personally. Hobbies center around positive emotions associated with enjoyment, but entrepreneurship involves a rollercoaster of emotions. Rather than taking feedback as a personal threat to one’s identity and ego, feedback should be embraced as an opportunity to stretch and grow.
As hobby entrepreneurs grow their ventures, reminders of purpose and passion infuse a sense of personal fulfillment and protect against potentially discouraging events and feedback. Positive reactions from customers, stakeholders, and the community further encourage motivation and understanding of the impact in creating value for others.
If you’re navigating the transition from hobbyist to entrepreneur, remember: the voices of money, the market, and your inner voice of meaning all have their respective influence and demands—some calling louder than others. It’s up to you to decide which to listen to and follow.
Benjamin Warnick is an assistant professor of entrepreneurship and strategic management in the Department of Management, Information Systems, and Entrepreneurship at Washington State University’s Carson College of Business. His research focuses on passion and motivation in entrepreneurship, including entrepreneurs who found businesses related to their hobbies or passions. He earned his doctorate in entrepreneurship and strategic management from the Indiana University Kelley School of Business.