This transcript was generated from the episode audio and may contain minor errors.
[Music]
Side Hustle School, welcome back. My name is Chris Guillebeau. We are approaching the end of the year. In fact, it's almost here, just three days to go if you're listening in real time. And the holidays are so busy, I wouldn't blame you if you're listening a week later or six months later.
In any case, at the moment I'm recording this, we are counting down to the end of 2017. I very much look forward to everything we'll be bringing you in 2018. Lots of good stuff on the way. But today I have a great story for you too, of course. And this story comes from South Africa.
We actually have a significant listener base in South Africa. So for all you guys out there, be sure you visit the Muggin Bean for me, one of my favorite places. About 10 years ago, I had the privilege of living in the country for about several months. I've been back several times, but only to Johannesburg since then. And I would love to return to Cape Town and some other regions, see more of the country.
But you're not here to listen to my travelogue, you're here for a story. And today's story is about an engineer in South Africa, an efficiency obsessed engineer, let's say, who uses the internet of things to scratch his itch for efficiency and move toward quitting his job. He ends up creating a stable revenue source with recurring income. That story's coming right up. [Music]
South African engineer, Colin Myberg, wanted an interesting side hustle that would one day help him quit his day job.
Obsessed with efficiency, he noticed that many of the factories he worked with were using outdated systems to collect information. They had people walking around with clipboards to monitor input and output, a practice that cost them thousands of hours and dollars every year. It was here Colin saw a side hustle opportunity. He'd been learning about the internet of things. And you may have heard of this before, it's about connecting objects to the internet to improve their functionality, things like thermostats or appliances, or even your doorbell.
Pretty much anything connects to the internet these days, which is scary. And in thinking about that, Colin felt he could put his engineering and programming skills to good use. So he created his own system that factory owners could implement to increase their productivity through his new business. And he called this new business production reporting. He would go into a factory, install a simple piece of hardware that he could source locally and have the data transmitted back to one easy to use dashboard.
The hardware would monitor cycle times, production counts, downtime reasons, and any other relevant info that could be used to make better decisions. Despite his background in engineering and programming, Colin didn't find his task easy. He spent many evenings and weekends locked away in his office working on it. He relied on online tutorials to help him tackle specific challenges that came his way. And he also reached out to freelancers on upwork.com whenever he got stuck.
Because he was building the whole system himself, Colin only needed to invest $370 to start this side hustle. He bought cloud space through Amazon web services, that gave him a place to store the data for his clients, and he created a simple website so that he could be found online. After a few months work, Colin's system was ready to roll out to clients. To generate interest, he began to offer free consultations to people in his already established network of factory owners and managers. Remember, engineering was his day job.
So he would go in, explain the system, and show mockups of the data they could be receiving in real time using his system. This has been the only marketing strategy he's used. Production reporting works on a subscription model, which makes his monthly income much more predictable. He charges around $1,000 for installation, and then around $400 a month for ongoing service. When clients subscribe to the service, they receive emails every morning with the previous day's reports.
And if they want, they have access to real time data through the online dashboard 24 hours a day. That dashboard can be accessed through their mobile phones, tablets, desktop computers, probably not their thermostat or doorbell, but anything else. Basically, they can get their information whenever and however they need it. Thanks to the subscription model, Colin has been able to generate recurring income of $3,700 a month through his new business, and it continues to grow month after month. What about the challenges?
Well, one time he was in a remote location working for his day job. That location had poor connectivity, and Colin got a notification that all of the dashboards and email systems he'd built had stopped working. Rutrow, he had to scramble to try and find a semi-stable Wi-Fi connection, get in contact with his clients, and call in some favors from other IT friends. He was able to solve the problem always well, but he also says it was a stressful experience and a close call. Colin's advice to you is pretty simple.
He says Google is your friend. There are so many great free resources from podcasts to eBooks to blog posts to help you solve your problems. Colin's goal is to grow production reporting's client base so that he can earn enough money to quit his job. He's also hoping to take this project from South Africa and eventually work with clients all over the world. [Music]
It's so great to see somebody from South Africa doing so well.
Congrats to Colin. And I think one of the smartest things he did, in addition to noticing this problem and creating the solution, which he was qualified to do based on his day job, his experience that he had, in addition to that, his pricing model is very smart. Now, he could have just charged for installation. He could have charged maybe more money for installation, but the $400 a month service fee for something that's very valuable to these factory owners and managers, that's where his sustainable income is coming from. Imagine that he charged twice as much for installation, $2,000 instead of $1,000, or he offered free installation, $0, but $400 a month for the service.
With that hypothetical scenario, just five months in, the free installation with the $400 a month service fee would have caught up to the initial $2,000 installation cost. And then after that in month six, in month seven, in month eight, and so on, he's gonna continue to receive $400 a month. So obviously that's so much better and he's not actually installing for free. He does get paid to do that too. So good for him.
And this story also reminds me that I need to book a ticket to South Africa. It's been far too long since I've been there. Maybe I'll see you there. Maybe I'll see you somewhere else in the world. Regardless, remember, inspiration is good, but inspiration with action is so much better.
Today's show notes are online at sidehustleschool.com/363. Thank you for listening. I'll be back tomorrow. I'm Chris Guillebeau for Side Hustle School. [Music]
