Building Multiple Revenue Streams
You’ve probably heard the phrase “don’t put all your eggs in one basket” before, and this couldn’t be more applicable to working as a freelance designer or artist. When I was first starting out, I was always trying to focus on doing only one type of work at a time, but over the years I’ve realized the financial and time benefits of diversifying my income as a creative business owner.
WHY DIVERSIFY?
Being a freelance artist is so rewarding in a lot of ways, but client work isn’t always consistent like it would be working in house or at an agency. There will always be slow seasons with not much to do. It’s during these slow times that having other revenue streams to work on can be especially helpful. It can be great in times of emergency as well. Let’s say you make most of your money painting murals, but you get in a mountain biking accident and break your leg. Chances are, you’re not going to be able to get up on a ladder anytime soon. If you’re in this situation and your only source of income is painting murals you might be in a lot of trouble (and also bored out of your mind for a while) but if you have other revenue streams you can pivot and be just fine.
To give you an idea, here’s a graph showing the different types of projects that I did in 2021. You can see that for me, client work was obviously the most profitable type of work I did. But when you add up the other sources of income like teaching, products, licensing and more it makes a pretty big difference in my total income for the year. It’s also important to note that these are MY NUMBERS. Depending on what you focus your time and attention on, your revenue streams might look quite different than mine.
Many studies have shown that the freelancers who are most financially successful and secure in their careers usually have at least seven streams of income. Here are a few different ways that I diversify my income and some tips for picking the best one for you.
CLIENT WORK
This is my biggest and my favorite source of income. This is when you are hired by a client to create work specifically for their needs. Typically these are longer format projects and also the most high paying. Some of the client work that I do includes logo designs, murals, apparel designs, lettering for advertising, editorial work, etc. As you can see, within client work there can be many types of work to do, but it’s totally fine to pick one thing and specialize in only that.
The Pros:
Long format projects
Higher pay
Diverse and never boring
Good for people who are good at communication and following deadlines
The Cons:
You have to find the clients (which requires marketing yourself or getting a rep)
Varying levels of creative freedom depending on the client and project
You must enjoy working with people and teams to do this sort of work
Currently I make the bulk of my income from doing client work and I love it! But it’s not without some challenges when it comes to finding and retaining clients. It helps if you’re not afraid of reaching out to people, are a good communicator and work well with deadlines.
MAKING AND SELLING PHYSICAL PRODUCTS
When most people start out as a freelance designer or artist this is immediately what they want to do first. Everyone wants to make and sell t-shirts, art prints, mugs and other products but there’s a lot that goes into it and the expenses are high compared to other types of design work. The cool thing about making and selling your own products is that you have a high level of creative control and can create work that supports your own personal brand. Just know that if you want to be able to support yourself selling products that you need to sell A LOT in order to be profitable.
The Pros:
You can make whatever you want
High level of creative control
No deadlines
Supports your personal brand
The Cons:
Supply costs (printing, shipping, materials, packaging, etc.)
You have to constantly SELL SELL SELL!
You have to charge sales tax for products (which you don’t need to worry about when providing a service.)
Dealing with extra inventory
Online shop fees and payment processing fees
Customer service
MAKING AND SELLING DIGITAL PRODUCTS
Selling Digital products is a great source of income that requires way less work and expenses than selling physical products. This could include creative assets like fonts, website templates or stock images or it could be other resources like digital workbooks or printables. You still need to create the products and sell them, but most of the time the transactions can be done automatically and no work is required on your end after the product has been created. The biggest downfall with digital products is that they are very easy to steal. If you sell a digital workbook, there’s really nothing stopping someone from printing off a bunch of copies and giving them to their friends. Or from someone emailing your font file to a bunch of people. This is unfortunate and frustrating (and if you find out it’s happening you can go after them if you have the copyright to your work) but it’s just something you have to deal with if you make and sell digital products.
The Pros:
Easy! Once the product is created it’s no work for you
No inventory issues, the product can be resold an infinite number of times
High level of creative freedom
The Cons:
You still have to market and sell your product
Online shop fees and payment processing fees
Sales tax
Dealing with people stealing your work
TEACHING
Do you have knowledge of a subject that you can share with others? Teaching can be an excellent form of income as a creative person and now with online options it’s even easier to find people who want to learn what you have to offer. You can teach in person workshops, or online through platforms like skillshare. You can also film and host your own online class.
In Person Teaching Pros:
In person workshops are a great way to make a good amount of money in a short amount of time.
You can form personal connections with your students that are very meaningful!
Greater perceived value
Establish yourself as an expert in your field
In Person Teaching Cons:
Supply costs and location costs
Limited geographically
You have to market the class yourself
Number of students is determined by your available space
Not good if you are nervous talking in front of people
Online Teaching Pros:
You can provide your class to a much wider audience
If your class is filmed beforehand, you only have to do the work once and can resell it as many times as you like. (Passive income!)
Establish yourself as an expert in your field
If you host the class yourself you can control the price. If you host the class through a platform like skillshare you don’t need to do as much marketing.
Online Teaching Cons:
You must be tech savvy! You need to be able to film, edit and host your class or must be comfortable using a live streaming platform.
If you’re hosting the class yourself you need to handle all the marketing for it. If you’re hosting your class through a platform like skillshare you don’t have control over the pricing.
Expensive starting costs. It can require a lot of time and money to create a high quality class.
Lower perceived value.
LICENSING
Licensing is one of my favorite forms of passive income! When you license a design you basically give another company the rights to use your design for a certain period of time and in return you get a small percentage of every sale they make (this can be anywhere from 5-15% but it’s usually no higher than that.) It can be tricky to find the right businesses to license your design to, and it usually requires creating a design upfront with no pay without knowing if it will sell which can be a bit of a risk, but a design can also continue to make you money for years and years on end. Another perk about licensing is that if you’re smart about it, you can license the same design to several different companies at once. Licensing is slow money, meaning that the profits come over time, but it also is a great source of passive income because once the design is created you can keep making money from it without doing any additional work.
Licensing pros:
A fantastic source of passive income that requires little work.
You can license the same design multiple places (If you’re smart and make sure that’s in your contract)
A single design can make you money for many many years
Zero marketing required
Licensing usually doesn’t include deadlines so it’s something you can work on when you have freetime.
Licensing cons:
No guarantee that you’ll make money.
No payment upfront, the payout requires patience.
Finding a good company to license with can be difficult. Many of the really good businesses are by invitation only.
BAD CONTRACTS. When licensing your designs you need to be very careful that you’re not selling away the rights to your design or agreeing to a bad non-compete agreement. Always read the contracts very carefully to make sure you’re not getting a bad deal.
CONTENT CREATION
I don’t do much of this, but I have friends who make most of their income through creating content for themselves and other brands. This can be done by making Youtube videos and selling ads, getting Instagram bonuses and doing influencer work where you’re paid to create content for other products or services. This can be a fun way to make money but it also requires a LOT of patience. In order to be profitable creating content you first need to grow an audience and prove to brands that your content is credible and is meeting a certain level of excellence. Most content creators do not make any real money for the first 2-4 years of creating content. Also many brands will want to pay you in product rather than actual money so that’s something you need to think about.
Content Creation Pros
It can be a lot of fun and a great way to connect with likeminded people
You typically have a lot of creative freedom and can choose what sort of content you want to create (reviews, tutorials, etc.)
Some forms of paid content creation (like making reels on instagram) are relatively fast and easy to do.
Present yourself as an expert in your field
If you do grow a large audience you can then convert them to other products or services you offer.
If you’re good, you can make decent money.
Content Creation Cons
It takes a LONG TIME to build an audience.
Most brands pay very little for influencer posts or videos (or they only pay in product)
You need to present a certain level of quality in order to be credible.
You have to constantly be creating new content to stay relevant
You are more likely to have to deal with horrible internet people
There is no guarantee you’ll make money.
BEING AN EXPERT
This is definitely not a huge source of income for me, but every year I get a few opportunities to make money by being an expert in my field. This includes getting paid to speak at conferences or events, being a guest on a podcast or writing an article or blog post for another platform. Although these opportunities don’t usually pay a whole lot, they are a great way to establish yourself as an expert in your field and get your work in front of new and larger audiences. If you do this regularly and gain a solid reputation you can get to the point where you make quite a lot of money as a sought after guest speaker.
Expert Pros:
Usually pretty easy money
Opportunities to travel and attend events
Establish yourself as an expert in your field
Get your work in front of a new or wider audience
Expert Cons:
For the most part these are by invitation only opportunities
The money isn’t usually much and sometimes you’re not offered payment at all
In the case of speaking and podcasts, it requires…. well… speaking.
The fact is, there are TONS of ways to make money as a creative and if you’re resourceful and smart you can come up with even more ways than these. Don’t be afraid to try new things but also be smart and focus your time on the things that are the most profitable (and the things you enjoy the most!) It’s easy to read this list and to get overwhelmed, but remember, you don’t need to do everything and building multiple revenue streams takes time. Just pick one thing, get it down, and add more as you go!
If this post was helpful for you, please leave a comment below! It’s always wonderful to hear from you!