8 Passive Income Ideas: How I Make $40,000/Week | OkDork.com

8 Passive Income Ideas: How I Make $40,000/Week

I've tried to create passive income streams since I was 21 years old.

The reality is, most of them bombed… But a few have completely changed my life and allowed me to retire by the age of 30.

And today, I’m making about $40,000/week of passive income.

I can promise you, however, that most of the work is never passive. But, it’s still worth it.

In this post, I'm going to share my passive income ideas to inspire you to create your own so you can retire whenever you want.

Before we dive into the passive income ideas, let me address a couple things that I think make all these other people talking about passive income full of crap.

“You don't have to do any work. Like, zero work.”

What do most people have wrong about passive income?

It’s never passive.

Significant wealth comes from active income. Conserving and maintaining your wealth comes from passive income.

So what am I saying with this?

You’re not gonna do one thing one time and be rich forever. It doesn't work that way.

If you're doing real estate for passive income, it takes a lot of work to buy a house and get a property manager. You might make a little bit of money, but it's not going to scale to significant wealth unless you get a lot of houses or a lot of properties.

Or if you want to get dividend income as a passive income stream, that's great! But you have to have a lot of cash to make a significant dividend income.

Where does the cash come from?

Active work.

So that's why I’ve always tried to discourage people from imagining they're going to get super rich from passive income.

I’ve always tried to discourage people from imagining they're going to get super rich from passive income.

The other thing that's really critical with passive income is to look at the return on your time.

A lot of people talk about return on investment (ROI) which means: How much am I spending vs. how much do I make from that? Return on time, however, is actually almost more important which means: I put in work once, and I get a huge return on it forever.

Look for passive income ideas where you invest your time once and reap the benefits forever.

You can make an ebook, you can make software, you can do real estate, you can do YouTube — these will all create different passive income streams. But you have to be mindful of the time you have available and which activities will create the greatest return over time.

Think about that as you choose which passive income ideas to spend your time on.

All right. Now that we've cleared up some of the basic ground rules around passive income, let's go over my passive income ideas so you can start making some more wealth for yourself this year.

8 Passive Income Ideas (& How I Make $40,000/Week)

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Passive Income Ideas #1: Start a Business

If you look on the Forbes Wealthiest People list, almost all of them have started a company.

So if you want to be really wealthy, start a business.

I started Sumo Group in 2010 in a basement in San Francisco. We have AppSumo, Sumo, and other products we've built over the years like SendFox and TidyCal.

Altogether, I’m making over $20,000 a week in passive income from those businesses.

Well currently, it’s not that passive since we’re looking for a CEO, so I’m doing more of the day-to-day stuff than I’d usually be doing. We did have an amazing CEO, Ayman Al-Abdullah, who did an amazing job around the business and there's an amazing team of people that help run it as well.

 

Check out my interview with Ayman where he talks about growing AppSumo from $4M to $85M.

 

The reality here is if you want to make great wealth, you need to get something going and make it significant and then bring on a team to help you scale out the business.

So how can you get started today?

First off, find a product or business that someone really wants.

I built 20 different companies over many years and most of them didn’t work out. For AppSumo, it was a culmination of bringing together the things I loved: I loved marketing and I loved deals. I still do. And at the time, daily deals and “Groupon” was a really popular business model, so it was the perfect trifecta.

Today, AppSumo is the #1 digital marketplace for entrepreneurs.

What Can You Validate Right Now?
So, think about this: Most of the most successful companies in the world are pretty much still the same as when they started.

Let me clarify…

Appsumo, when it started in 2010, I would go find the best tools for entrepreneurs and get a deal on it. Then I would send an email and promote it and we made money.

That's pretty much still what we do today.

If you go to Facebook, it's still connecting people today. If you go to Google, it's still searching the web. Yes, there's other product lines and features that have been added, but the main core of these companies is still the same.

So if you're thinking about starting a business, what is something simple that you can validate within a weekend to see if people really want it?

I think people waste too much money and too much time trying to get their business started.

What Do You Have an Advantage In?
Another thing to think about when starting your business (besides building it once and then doing it forever) is what do you have an advantage in?

So in real estate, if you've been doing real estate for a while, I can't beat you at that. If you've been doing YouTube for five years and you're willing to do crazy things, I can't beat you at that. If you can TikTok and do all that dance crap, I can't do that. You're going to beat me at that.

But internet marketing? I've been doing this for 20 years. I'm pretty good at it, so I'm going to have an advantage there.

So when you're starting a passive income business, are you a great chef? Are you great at sales? Are you good at marketing things? Are you a great developer?

Go and take advantage of that.

What is Your Total Available Market?
The other thing you want to consider is, what is your total available market?

If you're doing a cookie business, there's a lot of billion-dollar food companies so it’s actually a pretty sizable market. It doesn't matter how big the market is, it matters that you find something that people actually want and you stick with it for a very long period of time.

Check out these business ideas to get a bunch of other passive income ideas.


 

Passive Income Ideas #2: Invest in Crypto

The second passive income stream that I have for myself is crypto.

Personally, I use BlockFi and Coinbase.

In BlockFi right now if you move USDC (which is dollar coin) they give you an 8% return. I have almost seven figures in that, which means I get $80,000 a year, or a monthly income of $6,666.00 (that just looks scary).

You can also stake your Ethereum in Coinbase for a 6% return.

The thing I like about this is that they raise a lot of money, they take that money and go lend it out to a bunch of other people, and now I can get over $6,600 a month and I literally don't have to do anything.

The way I was able to accumulate a lot of the crypto and the money that I've actually been able to use for this is that I did small monthly investments for the past five years.

So I invested $500 a month for the past five years and that's built up millions of dollars in these crypto accounts. And now I have some of it through USDC that’s providing really high interest as well as some interest coming from Ethereum.

There's a bunch of other content on how to invest in BlockFi, I'm not going to get into the nitty-gritty details here, but if you want to learn more about my crypto portfolio and exactly what I've done with it, check out this video.


 

Passive Income Ideas #3: Start an Online Course or Community

We started a course a while ago called Monthly1K. It's still available today.

It passively generates around $1500/month — which is cool.

We started this course years ago because:

  • We wanted to create income that was more controllable by ourselves
  • I was tired of people asking me how to start a business

At peak, we made a million dollars a year from this course.

But here's what's interesting…

We were promoting it all the time. It was literally like a full-time job.

So it earned $80,000 a month, but it took four people to do that and it was a lot of work.

The hard part is actually getting customers and making it passively recurring revenue.

So what I'd recommend is to put it on the AppSumo marketplace where we promote it for you, and then think about how you can get customers consistently.

Is it going to be from YouTube? Is it going to be from podcasting? Through blogging? Partnerships?

Think about how you can have a consistent amount of students coming to your course so you can have consistent revenue.

Another thing you can check out is Behind the Scenes of a $5,000,000/Year Online Productivity Course from Tiago Forte to learn more about how to run a course successfully.

Btw -- Sign up for my newsletter. It's FREE, and you'll get my best business tips.


 

Passive Income Ideas #4: Invest in Index Funds

Another one of my passive income ideas is index funds.

I use Schwab, but you can use Vanguard, Betterment, Wealthfront, or whatever type of service you want.

My monthly dividend income is around $8,292.78 (or around $2,000/week) give-or-take. And that’s coming from over a million dollars in assets.

So, what is an index fund?

Instead of buying one stock, an index fund buys a bunch of different stocks and some of those stocks kick off dividend income. Dividend income is a monetary return for holding their shares.

Personally, the four index funds I buy are SPEM, SPDW, SPLG, and SPSM.

The other thing you can look at is which stocks actually have dividends.

So one of my favorites (because I'm more boring as an investor) is Verizon. They have a great dividend and I don't think they're going to go away anytime soon. AT&T is another stock I pick for the same reasons, as well as Apple. Plus their stock hopefully appreciates in the long run.

The biggest thing with index funds is that there are many strategies about growth stocks or value stocks vs. small companies — but I would just say, if you want to get a little bit of passive income from this source, just get started every single month and keep doing it consistently for at least 10 to 20 years and it will likely build up to be a significant passive income stream for yourself.


 

Passive Income Ideas #5: Build Your Own Software

Another one of my great passive income ideas is you can actually build your own software.

So at Sumo Group we've built SendFox, KingSumo, and TidyCal, which are some of our most popular AppSumo original products.

These products are generating over $60,000/month (over $15,000/week).

We have great developers and support people around the products, but we’re not doing as much work on them now as we were when we originally created them.

So how can you get started making software?

Great question.

Especially if you don’t know how to code.

You can use Google Sheets or a lot of the no-code software. There's a lot of different tools on AppSumo that you can actually use today.

My suggestion is to see if you can actually help people first by making something they want, and then if it works out, you can turn it into software.

Everyone always does it the other way around — you're probably not going to listen either — but maybe one of you will.

Don't go build it first.

Go get the customers first and help them… And if that works, then turn it into software.


 

Passive Income Ideas #6: Invest in Real Estate

A few years ago I got really excited about Airbnb so I bought a place in Austin, Texas for around $300,000 — and now it's kicking off about $1,000 in profit a month.

That's cool!

I also have a property manager who deals with everything so it's literally not really even in my mind.

The reality is, even though $1,000/month is great… By creating software and actually scaling up AppSumo, we can do $1,000/day in profit. Or more.

So if you're thinking about getting started with Airbnb, my suggestion is…

Don't go try to buy a place.

Go actually talk to people renting their houses and say, hey, can I manage your Airbnb and see if I can rent it for you?

Or go split a place with a few people and that will actually de-risk yourself so you're not putting up all the capital.

If I wasn't in tech, if I didn't do online marketing, if I didn't know how to start businesses, an Airbnb approach would be really interesting.

Some of the problems with this passive income stream though is that everyone else can do it and everyone else already knows about it… So how are you gonna get a significant advantage?

You probably won't.

It doesn't mean that there's not an opportunity for you to do it, but just keep in mind that when there's more people who know about it, the profit potential can get squeezed down.

In this video you can see how much money I make from my Airbnb. Watch it if you want to see a little bit more behind-the-scenes of how I started this passive income stream.


 

Passive Income Ideas #7: Start a Blog or Newsletter

I started OkDork in 2000 (which is bonkers) and I think it made around $250/month from Amazon Affiliates at the time, so that's like $60/week.

When I started blogging, I’d link books on here and other products I recommended, and these Amazon Affiliate links would create income… But it wasn’t consistent income.

I’d have $1000 dollar months when I recommended products like vacuum cleaners, but nowadays it's bringing in barely $50 bucks a week.

So it's not tremendous, but it's still nice to have a free dinner from it.

The point here that's really key is you want passive income that's going to be consistent over a long period of time — like the dividends. Hopefully like Airbnbs. Hopefully like the crypto stuff. And starting a company.

Another downside to affiliate income is that Amazon can change their rates (and they do).

So if you're thinking about getting started, one thing you can do is search “what are the top affiliate payouts” and then start creating content by recommending those kinds of products.

I've never really been a fan of making a lot of money through affiliate income though because I just don't think you actually get that much return on the time you put in.

But it’s one of the most popular passive income ideas for sure.

If you're thinking about doing a blog or an email newsletter and you can stay consistent with it and do it weekly, I actually think it’s a really cool way of making income because you can directly tell people to go buy the products you recommend.

Check out below email marketing for beginners from zero to 100 subscribers on our channel to learn more about it for yourself.

If you do get started with this passive income stream, remember the Law of 100.

So if you're blogging, if you're doing a newsletter (check out SendFox if you do), do at least 100 of them before you even think of giving up.

If you do, I promise you'll be a lot further ahead than you imagined.


 

Passive Income Ideas #8: Sell Digital Products

I've created two books, one is about getting fired at Facebook and the second one was about what people are doing with money that they don't want to tell us about.

I make around a few hundred bucks a month from these books.

I literally just wrote these books because 1) I wanted to talk about my time at Facebook, and 2) I wanted to learn about what rich people are doing that they're not telling us.

I sell them on Amazon (which doesn't actually promote your books a lot) and today they’re bringing in some sales, but nothing significant.

I would actually recommend selling your books or digital products on the AppSumo marketplace to actually get some promotion. Like I’ve said before, we market your products for you.

There are other places out there but AppSumo is the one I think works best and I can actually recommend it to you.

So what should you actually write about if you want to start making passive income today?

What do you get paid for in your day job? What have people paid you for in the past?

That's what you can create a digital product around.

The bigger and harder part is figuring out where you can sell it so you're going to get consistent income. Create your digital products and then focus on that.


 

Which passive income ideas will you try?

All in all, I make almost $40,000/week just from passive income.

That’s pretty bonkers.

But for probably about the first 15-17 years of my career, I wasn't really making crap.

The key thing for you is not whether one of these passive income ideas is going to work for you… It’s that you need to start planting some seeds today to get going so in 5 years, 10 years, or 20 years, you can do whatever the hell you want.

Retiring sucks — no one should retire — passive income is all about giving you freedom so you can then spend your life doing whatever you want to do.

Whatever is for you, I want to help you accomplish that.


 

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