I've been trying to do this for a long time, but I have to admit something rather peculiar about my frustrating attempts to do so.
I started a company with my brother in 2010. It involves websites, and it takes up about 10-20 hours of our time per year. It costs us about $150/mo to run and earns us anywhere from $1000-$2400/mo (probably $1,600/mo average). It's earned around the same income for about 3 years, and before that it earned $400-$800/mo for most of time during the first 2 years.
We could continue working hard to increase the amount our business earns, perhaps until it reaches $8,000-$10,000/mo (very realistic, but would require about 2 man months or so each), but for some reason neither of us are ever excited to work on it. In his spare time, he's busy doing his stuff (completely unrelated work), and I'm busy working on the next big thing (creating an SaaS, or at least trying to determine one to work on). It's really stupid, because we have this boring thing that earns us huge returns on our time invested, and currently pays us nearly $1,000/mo each for doing basically nothing, but we somehow find every excuse to work on something more exciting with little monetary returns, or perhaps simply scratching our own itches.
I think the lesson you can take from this (which I clearly haven't learned) is that you shouldn't seek to "create a SaaS", necessarily. Instead, figure out the path of lease resistance to the dollars you want, and don't worry about the "passive" nature of it. You can automate things later, in theory. Worry first about finding easy money. It really is out there.
I know that money isn't everything, but it is pretty important. If you have passive income coming in, you can work on all the fun and world changing projects (or charity, etc.) you want, and all without worrying about going broke.
I see quite a few stories like this on HN. They are v intriguing. Incredibly high return on time-investment, allowing you the freedom to work on other things.
I used to think my cash cow (freelance management consulting and putting together pitch deck presentations) was pretty awesome. But examples like this dwarf it in terms of ROI ratio.
Can you give more detail on what it is this business actually does? Or else, do you have other examples of high ROI side projects?
This business isn't the kind of company a VC would invest in, which means it's also not the kind of company that somebody would see and think, "We could blow this thing sky high!" (unless $8-10k/mo is sky high). It does have great potential, but there is no chance of it growing exponentially (like a social network or other highly successful SaaS). Because of this, I couldn't imagine getting more than 3 years revenue for it, and it's such a consistent income earner that it's not something I would want to sell for less than (perhaps) 8 years revenue.
Sounds reasonable and makes me think, ok you are not excited to develop it to the next stage but what about getting someone else to help you with that?
What about selling with some kind of profit share/earn out if the other person manages to grow it, if you think that with effort it could be 10x larger there is plenty of upside for both parties. Someone else who wants a SaaS business, not a VC.
I started a company with my brother in 2010. It involves websites, and it takes up about 10-20 hours of our time per year. It costs us about $150/mo to run and earns us anywhere from $1000-$2400/mo (probably $1,600/mo average). It's earned around the same income for about 3 years, and before that it earned $400-$800/mo for most of time during the first 2 years.
We could continue working hard to increase the amount our business earns, perhaps until it reaches $8,000-$10,000/mo (very realistic, but would require about 2 man months or so each), but for some reason neither of us are ever excited to work on it. In his spare time, he's busy doing his stuff (completely unrelated work), and I'm busy working on the next big thing (creating an SaaS, or at least trying to determine one to work on). It's really stupid, because we have this boring thing that earns us huge returns on our time invested, and currently pays us nearly $1,000/mo each for doing basically nothing, but we somehow find every excuse to work on something more exciting with little monetary returns, or perhaps simply scratching our own itches.
I think the lesson you can take from this (which I clearly haven't learned) is that you shouldn't seek to "create a SaaS", necessarily. Instead, figure out the path of lease resistance to the dollars you want, and don't worry about the "passive" nature of it. You can automate things later, in theory. Worry first about finding easy money. It really is out there.
I know that money isn't everything, but it is pretty important. If you have passive income coming in, you can work on all the fun and world changing projects (or charity, etc.) you want, and all without worrying about going broke.