5 traits of a TERRIBLE side hustle

Howdy, happy Saturday.

We talk a lot about killer side hustles here and my favorite aspects of them.

Let’s talk about a few things I DON’T like about side hustles I see.

1. You’re trying to do something ‘new’. Believe me, I am all for trying new things. I do it all the time. But trying to break new ground in a business is hard as hell. The chances of success are next to zero. And if you’re new to the thing or entrepreneurship in general, it’s going to be a looooooong road. Decades long. My suggestion, especially for your first gig, is to do something tried and true. Do something that is already working. You can put your own spin on it! In fact I recommend doing that, you should differentiate yourself. But don’t try to attack a “blue ocean” and hold down a full time job too, it’s not going to end well.

2. The juice ain’t worth the squeeze. I had a girlfriend a long time ago who was a corporate trainer by day. For her side gig she did wedding planning nights and weekends. In her mind it was going to be fun, you get to help happy couples on their special day! The reality: total nightmare. Bridezillas, drunken grooms, demanding parents, and flaky vendors. The pressure on the wedding day was immense. If ANYTHING went wrong, guess who got the blame? And the money she made was pathetic compared to the hours she put in. She was making minimum wage with mega stress. Not worth it. Find a side gig where your $/hr wage is enticing.

3. Location challenges. People message me every day about a car wash deal that is 60 miles or more away. Don’t do it. You don’t need to go there every day, but you should try to go there on a regular basis. The closer it is to you, the easier that’s going to be. Especially for your first gig. Find something close to home, even if you have to pay a little more for it.

4. Overemphasizing scalability. It happens every time. I post a side gig, someone chimes in with “that doesn’t scale”.  Yeah, no sh!t, not everything is scalable. There are thousands of businesses that throw off great cash flow and don’t have a ton of growth prospects. I’ve covered value-add here a lot, there’s always something you can do to grow a business. But the notion that you need to be able to 4-5x everything in a few years is a fallacy that comes from startup culture. Find stuff that can grow slow and steady, don’t worry about blowing it up.

5. Horrible labor pool. A friend of a friend has a thriving bounce house business. Making great money, but his employees are total bozos. They showed up to set up a massive bounce house at my home and it was comical. One guy (the owner) doing all the work and the other two nimrods standing around watching. Think about WHO is going to work at your gig so you don’t have to. At our car washes we love the old duffers. They want part-time work, are very dependable, and are often handy with a wrench. The downside is they go to the doctor every week. We can deal with that. Figure out where you’re going to find your labor pool before you dive in. We’ve also had great luck hiring college girls for our household needs (kid and pet sitting, errands, etc.). They are mature beyond their years., hardworking and very reliable. The only problem is you cycle through them regularly as they get full time jobs or move away.

One last thing I see potential side hustlers making mistakes on: misunderstanding macro trends.

Example: my friend Mitch has a thriving ATM business. But a lot of people would view that as a sinking ship. Will we even use cash in the future? You can bet a lot of people will, yes. There are still a ton of people out there that don’t use payment cards. We see them every day at our car wash getting change for a 20. Immigrants use almost entirely cash. And there are still places where you can ONLY use cash, like marijuana dispensaries.

So he’s killing it because his business is still in demand, but the supply of buyers is declining (meaning there are fewer buyers in his industry because they believe its a dying business) so he’s cleaning up.

Don’t make the same mistake. I remember having a lively discussion about the future of car ownership. This was ~2012 when everyone thought Uber would take over the world. My friend was claiming vehemently that car ownership would cease to exist. EVERYONE, he was adamant, would simply hit a button and a car (self-driving of course) would simply show up. So, according to this technophile, the entire car industry would cease to exist as we know it. He used those words.

The reality? Car ownership is UP since then, Uber is an afterthought and people drive their own cars more than ever.

Similar dynamics with paper. If you owned a timber mill that fed paper mills in 2007 and saw the future of the internet laid out in front of you, you’d probably run scared, right? Well, actual paper consumption has fallen slightly, but overall is steady now. It’s not a dying industry by any measure.

And wood pulp consumption has skyrocketed. Why? Cardboard. We ship more things than ever now and 99.9% of it arrives in a cardboard box.

So be careful seeing short term trends and assuming “this will not exist” in a few years.

What do you think? Did I miss something in my things to avoid in a side gig? What is an industry that won’t exist in a few years?

Kriss, the Car Wash Guy.