Passive Income

Sep 20, 2021

What is Passive Income?

Passive income is income that requires little to no effort to earn and maintain. Examples of passive income include rental income, dividend stocks and any business activities in which the earner does not materially participate. 

Be careful! There are a lot of junk content out there who promise results with almost no value-adding activity.

There exists nothing as passive money. Passive income streams are not outcome of a magical phenomenon generating wealth for no effort. In fact, they are the outcome of hard-worked-on systems set up to serve customers also when their owners are not present in a direct interaction with their customers.

Both active income as well as passive income are made by efforts of their entrepreneurs. Though the difference is that passive income streams tend to grow much more over time, independent from the amount of the direct effort, or hours, that one spends on those.

What is a Passive Business?

A passive business is one which is based on one or more streams of passive income. Some of the traditional ways to generate passive income include rental income or trading stocks. In all these businesses, you do not trade your time or efforts for money. Instead, you leverage your investments in different type of assets to create recurring income.

What are some of the passive ways to make money?

Some may look for easy passive income strategies. And there are some easy passive income opportunities out there. But most of the legitimate and rewarding routes in making passive income, are shaped through efforts by entrepreneurs who set these businesses up and enjoy the benefits for years. Passive money making is an art and a mindset, which is far from being laid back.

To create a passive income business, one would need to learn the basics and then to choose the right ways from among passive income ideas to create passive income suitable for him or her. There are much more ways to get passive income other than getting rental income from owning rental properties or owning or trading dividend stocks. We will introduce more ways to earn passive income here in Passive Income River, especially some from Online Businesses.

What is an Online Business?

An Online Business is a business which has some of its main components online. Think of a webshop or webstore where the sales process is partially or fully automated through an online presence i.e. the webshop. A webshop enables the business owner to bring one of the key processes of the business (in this case Sales process) online.

Think of an online portal where you pay for your telephone or utility bills online instead of contacting or visiting your service provider. In this example the customer support services including invoicing and credit collection have become online, making the business of your supplier partially an Online Business. 

How to start online business?

Starting an online business is not difficult. Specially if you take the right decision about what kind of online business to start. Covid-19 crisis pushed more businesses and individuals to go online. 

If you have an existing business and want to make an Online Business out of it, you need to go through a Digital Transformation process. And let us tell you, Digital Transformation is much easier concept than you may think, and it may start with simple steps like building a Website, a Webshop or an Online Appointment Booking System for your customers and more. 

But if you are an individual thinking how to start and an online business or wondering how to start online business from home, it is good if you start first learning what are the best online business to start. How do the best online businesses look like? How do you choose and shape a successful online business? This is another important topic and step which we will talk about here in Passive Income River.

We will talk about online businesses in general, online entrepreneurs, online business from home, and also online business for students. To get to learn about more ideas for passive income, you need to look into passive business ideas which have been successfully utilized by other entrepreneurs, specially to create passive income online. 

What are the top ten online businesses to earn passive income online?

There are many different ways to create passive income through an online business. As a starter you may want to look into some of these examples of passive income:

Affiliate Marketing

Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate’s own marketing efforts.

If you join one of the Affiliate Marketing Programs, you will be given an affiliate website and affiliate links which you can direct people you find interested in those products to. You will be paid an affiliate fee or as sometimes called an affiliate commission, when those customers you find, purchase the products from the affiliate marketing program of the company you work with.

There are many affiliate marketing sites and affiliate networks from which you can find best affiliate programs in your country or globally. Affiliate Online Marketing is also another terms which is used for this, as most of the processes in Affiliate Marketing are online needing no need for you to deal with customers, products, shipment and so on directly. You promote the products online and get your affiliation fees as a reward of your success. Affiliate marketing is one of the best passive income ideas to start with.


Dropshipping Business is a streamlined form of retail business wherein the seller accepts customer orders but does not keep goods sold in stock. Instead, it transfers the orders and their shipment details to either the manufacturer, a wholesaler, another retailer, or a fulfillment house, which then ships the goods directly to the customer. 

Most of Dropshipping stores are online stores these days. As such, the online retailer i.e. the store, is responsible for marketing and selling a product, but has little or no control over product quality, storage, inventory management, or shipping.

Selling Information Products

Selling online courses or delivering live online training courses is one of the proven ways to generate passive income online through Information Products. You can also think of packaging your knowledge into other formats such as ebooks or other media as a way to monetize your expertise and create passive income online. 

Coaching and Consulting

Coaching and mentoring or consulting have always been hot topics. With both our personal lives and the business environment of today becoming more and more sophisticated due to lots of new strategies, tactics and technologies, there is more than ever need for good coaches, mentors and consultants who help their customers with the right choices for themselves and for their businesses.

Coaching and mentoring can also be a good combination with selling your online courses or other information products. It adds to the overall value proposition to your customers and gives a platform to test and validate new ideas.

Membership Websites And Membership Programs

Membership programs are usually membership websites which offer their members content, experience or a possibility as far as they remain and pay their membership fees. Membership websites are a great way to create passive income. Online entrepreneurs use membership website builders to create membership sites in which they share exclusive content with a restricted number of their audience how are the subscribers to their membership programs.

Digital Marketing

Digital marketing is the component of marketing that utilizes internet and online based digital technologies such as desktop computers, mobile phones and other digital media and platforms to promote products and services. Digital Marketing is a core component in the success for most of online businesses and passive income models. 

Learning digital marketing for your other online businesses, you may wonder why you do not make money from the skills you have gotten selling digital marketing services. And in that you are not alone. Successful online entrepreneurs usually benefit from selling digital marketing services ranging from their expertise in social media marketing and time to digital marketing solutions and software as a service (SaaS) to generate another stream of passive income next to what they already do.

Freelancing And Virtual Assistant Work

Freelance, freelancer, or freelance worker, are terms commonly used for a person who is self-employed and not necessarily committed to a particular employer long-term. Part-time work, consulting work or other forms of not-employed engagement with other individuals and businesses are all different forms of freelancing and hence nothing new. What makes freelancing so modern are the new realities of the age of digital transformation which makes the gig-economy a reality.

Gig workers are independent contractors, online platform workers, contract firm workers, on-call workers and temporary workers. Gig workers enter into formal agreements with on-demand companies to provide services to the company’s clients. 

The world on online businesses and the road to generate passive income is both a need – for employers of gig workers – as well as an opportunity – for the freelancers – in today’s modern business. Hence sitting in the office of your gig-employer or at the comfort of your own sofa at home, you can help individuals and businesses both with what they have to do as their physical or virtual assistants generating both active but also passive income streams for yourself.

Software As A Service – SAAS

Software as a service is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted. It is sometimes referred to as “on-demand software”, and was formerly referred to as “software plus services” by Microsoft.

But why software as a service can be a passive stream of income for you or your future business?

Selling a software in the past was most of the time a one-time purchase of a license to be allowed to use the software being installed on your computer or server. But as part of Digital Transformation, there is no longer need that businesses own the servers or powerful computers to store your software nor your data. Now theycan buy “Storage as a Service”, “Software as a Service” and “Computation as a Service.” 

As a result, the customers save all the investments and the efforts in the hardware and software they neededto install and maintain in the past. The providers on the other hand are able to create a “recurring income” from subscriptions which give more financial predictability loved by the shareholders.

You can think of building a solution in your area of expertise and define it as a SAAS and sell it to your customers generating recurring and most of the time passive income. And in doing this, you are not the one who should know software programing. There are many different options ranging from hiring an expert or a supplier, to partnerships or using no-code solutions to make a software making it another stream of passive income for you and your business.

Sell Handmade Goods

It may seem too obvious. But there are millions of people who are selling handmade good ranging from bath soaps, T-shirts and printed merchandise, jewelry, curated gift and subscription boxes to candles, sweets, art and prints and digital products.

It is exactly the online business models and the internet which are enabling these entrepreneurs build their business and go online in a matter of few days if not few hours.

Influencer Marketing

Influencer marketing is a form of social media marketing involving endorsements and product placement from influencers, people and organizations who have a purported expert level of knowledge or social influence in their field.

Doing so you can act as a brand ambassador staying a Social Media Influencer, or become an Influencer Marketing Agency, by providing services in Digital Marketing to other businesses using the knowledge you can gain knowing the influencer marketing dynamics. 

Becoming as an Influencer Marketing Hub is the ultimate aim where you create multiple streams of passive income from different value proposition you offer to your customers.

How Much Passive Income Can You Earn?

If you research on how to generate passive income, you might be concluding that you can choose one of the passive income sources, take action and soon make thousands of dollars a month.

But that is not usually how it works. Creating multiple passive income sources is not a short-term strategy.Some of the best ways to make passive income are long-term investments. There are some people who make a living out of passive income streams they have. But there are people who have few sources of passive and active income adding up to what they need to satisfy their need.

The best is to learn about as many passive income models as possible; then choose few that are close to your today or to-be-built skills that are also successful passive income sources for others. You should then pivot and adjust as you gain experience over time, to find the best mix for you and your business.

What kind of tools and software do you need?

To be able to enter any of the Passive Income businesses, you may need different software and tools. From simple document editors like Microsoft Word or Apple Pages and Image editors like photoshop, to Website builders, Email marketing solutions and funnel builders. But before jumping into purchasing many different software, talk to an expert to ensure you are not getting more than you need. You want to become an Entrepreneur, not a ‘Tool-preneur’.

One of the most powerful softwares you may want to look into however is GrooveFunnels. GrooveFunnels is a suite of online business tools designed for business owners, but without the complexity and the expensive price tag. In fact, it’s quite the opposite, because GrooveFunnels is not only easy to use, it is also free. To learn more about this software, read our blog article here or visit their website here.

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