Income Streams & Business Architecture
Here's another excerpt from my book, Online Rockstar: The Digital Entrepreneur's Guidebook to Building an Online Business that Rocks! It teaches you the Holy Trinity of Revenue Generation.
Diversification of Income:
No doubt you’ve heard this term before. Your financial advisor has probably suggested you do the same with your investment portfolio. It’s the practical way of not ‘putting your eggs all in one basket’ as the old adage goes. The same principle of careful planning of your income streams should be extended to your Rockstar Business.
Diversification of income is made possible by the concept of what I call…
The Holy Trinity of Rockstar Income
- The Protégé Model
- The Deadhead Following
- The Distribution Chain
Together, these revenue models form a strategy that can skyrocket your income and your satisfaction with your MB.
Done correctly, any of these revenue models will earn you a handsome living. But when all three are present in the structure of your Rockstar business, you have a revenue model that is recession-proof and inflation-proof.
Pretty darn cool, eh?
Let’s examine each of these and see how others have done the same thing with great success.
In this model, you spend time one-on-one with a person who is under your guidance and direction. Many businesses are constructed on this foundational element alone. It’s also known as consulting or coaching.
When you see your dentist, dermatologist or chiropractor, you’re spending time with an expert who's guiding and directing you in a specific area. You’re paying her a fee in exchange for her time and experiential knowledge.
That's the definition of a mentor-protégé relationship; the mentor gives of her time and experience in an effort to help the protégé succeed.
As a Rockstar business owner, you possess specific knowledge and experience that others will pay you to share. When you do this, you become the Mentor to a Protégé.
Online Rockstars Using the Protégé Model
BlogMarketingAcademy.com David Risley is a professional Rockstar blogger. He is an excellent example of how to the Mentor-Protégé relationship can be profitable and helpful to clients.
At one time David offered several options for his Protégé services. David offers his consulting in blocks of 30, 60, and 90-minute periods. His hourly rate is $250. Can you see how the Protégé model can be an important revenue stream?
Corbett Barr is a self-professed entrepreneur and digital nomad. He lives in San Francisco part of the year and Mexico the rest. He runs a few very successful online businesses. Corbett stopped his Protégé services (which had reached a service fee of $300/hour) and instead takes on a limited number of long-term Protégés. His is a slightly different twist on David Risley’s model but it works for him.
Pamela Slim is the Rockstar who wrote Escape From Cubicle Nation and Body of Work; she runs the website with the same name.
Pam offers her Protégé services for individuals in business or those in corporate cubicles who want to break free and start their own Rockstar business.
Your protégé model is going to be different
If you're in the coaching business, coaching per hour, per day, per month is your one-one-one protégé time.
If you're in some other field, your protégé model is simply going to be trading your specific expertise for money with those who want it.
The Protégé Problem
There is a downside to consulting. If you fill all your billable hours with consulting, you'll likely not have time to expand your business or take a holiday or vacation without your income stream ceasing.
The exception to this is a monthly retainer paid by clients for your time as agreed upon in advance. If you operate in this consulting model, you're more likely to be able to take time off.
But there is another issue with the all-consulting model: Limited income.
If you fill your week with billable client hours, the only way you'll raise your income level is to raise your fees. This might result in client attrition. For most consultants, raising their fees is a delicate dance.
You can solve this problem by adopting the second part of the Holy Trinity of Rockstar Income, one-on-many consulting or training: Deadhead Training.
The Deadheads – A loyal group of fans followed The Grateful Dead around from city to city living a vagabond life as they expressed their loyalty to the band. The deadheads inspired this second part of the Holy Trinity of Rockstar Income.
Training Your Deadheads
I once attended a New Patients Open House held by a chiropractor. The open house consisted of him making a presentation to new patients about his practice, his approach to chiropractic health maintenance and the role the patient plays in the process.
The chief benefit of doing this? He was able to give the presentation once and have multiple attendees gain the benefit of his expertise.
Training allows you to give your presentation, slide show, eCourse session, etc., to multiple parties at the same time. Think of training as group consulting. Each member of the group is paying you a fee and you're giving out the information one time only.
You are still providing your expertise in exchange for money, but if 10 people attend your training session you've multiplied your income ten-fold.
The Problem with Deadhead Training
It takes time to construct a good training model. But it can be done very easily.
- Training doesn't have to require a room or physical attendance at a seminar (although, you can charge a lot more if you do). It can be as simple as groups call on a free conference service that you record or via live video using Google Hangouts or Skype.
- The positive benefits of holding training sessions in that you multiply your income without filling your week with consulting hours. That doesn't mean you can’t still consult, but it does mean you might want to decrease your consulting hours to make room for training.
- Training also further establishes your leadership role in your Rockstar Business. It reinforces the perception that you’re an expert in your field. It also generously floods you with material to leverage into products.
Consulting and training make a good mix, but there is a third element that will really help sustain your Rockstar Business.
The Distribution Chain
The Distribution Chain is the third element of the Holy Trinity; leveraging your training sessions, books, eBooks, seminar videos, or products authored by others that you promote through an affiliate relationship.
Leverage offers you freedom from the time-for-cash income trap because your blog can sell these products for you 24-7.
Total automation of selling your product online is not only possible, it’s become a very common practice.
Making your offer, collecting money and getting paid, and delivering the product to your customer - all are possible without much ongoing work from you.
Successful Rockstar Businesses are built on the Holy Trinity
- David Allen of Getting Things Done
- Stephen Covey of The Seven Habits series
- Sean D'Souza of Psychotactics
- Mark Silver of Heart of Business
- Ash Ambirge of The Middle Finger Project
- All use the three elements of the Holy Trinity of Rockstar Businesses.
Even traditional businesses like Harley-Davidson and Elvis Presley Enterprises use the Holy Trinity.
Where to Get Started
Protégé - Begin to look at why your readers seek out your blog or business. What it is exactly that you're giving them? Could you perform this as a one-on-one service? Many readers would love to hire an expert to do what they lack the confidence or time to complete on their own.
Deadhead Training- Evaluate your consulting model for ways you could present this information to a small group and earn your consulting fee X 10! There may be other areas of your business that you've wanted to bring to your clients but lacked the time. Training represents a great way to introduce a new service.
Distribution Chain - Recording one of your audio training calls is the easiest way to produce your first product. Hold the training session, record the call and offer it as a product on your blog. Of course there are many more steps involved, but can you see how doable this is?
Getting the Holy Trinity of Rockstar Income working for you will take some time, but the benefits are incredible:
- More money
- More free time in your schedule
- The potential for diversity in income streams
- Freedom from the time-for-cash income trap of traditional jobs