How to start a side hustle while you're still in college - CNBC

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Original source: CNBC
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Published: Aug 10th, 2022
How to start a side hustle while you're still in college - CNBC

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And, according to financial advisor Winnie Sun, Kazemi is going about it the right way: Start a side hustle that you are passionate about and dedicated to being the best at.
More from College Voices: TikTok resumes and Instagram portfolios: Using social media to find jobs College students used Instagram to sell face masks during the pandemic How to become an influencer on TikTok or Instagram Sun is a member of CNBC's Financial Advisor Council, a founding partner of Sun Group Wealth Partners and a lifelong entrepreneur.
"Entrepreneurship is the new job security for, I used to say my generation, but now I believe it is for [Generation Z]," said Sophia Bera, a second CNBC Financial Advisor Council member, who calls Gen Zers "young" and "scrappy.
"Even though I'm a financial advisor and I could do my own taxes, [hiring a good business accountant] was probably one of the best decisions I made," Sun said.
" Jaime Sullivan is a senior at Boston University and the founder of social media-based store Cafe Bleach.

How to start a side hustle while you're still in college - CNBC

College is a great time to start a side hustle, and the pandemic — which resulted in lost internships and jobs — made exploring money-making options now even more important for students. In 2021, one in three Americans had a side hustle, according to a recent survey by workflow automation platform Zapier. And among the millions still "hustling" by 2022, Side Hustle Nation found that 24% were between the ages of 18 and 24. A side hustle can be anything, like tutoring, being an Uber or Lyft driver, selling clothing, testing products or being a virtual assistant. Recent UC Berkeley graduate Kiana Kazemi, who majored in data science with an emphasis in environment, resource management and society, co-founded her business Circularity during the height of the Covid-19 pandemic. The multimedia platform, which includes a social media presence, published resources, workshops and a mobile application (coming soon, she says), is dedicated to helping people tackle "eco-anxiety," or a fear of environmental doom. Kiana Kazemi is a spring 2022 graduate from UC Berkeley and co-founder of the multimedia platform Circularity. Source: Moe Sumino "There are many ways to make money," Kazemi said. But working on something that she saw a need for in the world provided "motivation in a lot of difficult moments." Now, with a team of six part-time workers including engineers, researchers and designers, Kazemi's side hustle is on its way to one day becoming a main hustle. And, according to financial advisor Winnie Sun, Kazemi is going about it the right way: Start a side hustle that you are passionate about and dedicated to being the best at. More from College Voices: TikTok resumes and Instagram portfolios: Using social media to find jobs College students used Instagram to sell face masks during the pandemic How to become an influencer on TikTok or Instagram Sun is a member of CNBC's Financial Advisor Council, a founding partner of Sun Group Wealth Partners and a lifelong entrepreneur. At seven years old, she sold avocados in her front yard, and in high school she started a tutoring service that paid for her first year of college. Sun even founded a television audience consulting company while studying full time at UCLA, signing hit shows like "America's Funniest Home Videos" and "Jeopardy," recruiting thousands of people each week and selling that business by age 24. "Entrepreneurship is the new job security for, I used to say my generation, but now I believe it is for [Generation Z]," said Sophia Bera, a second CNBC Financial Advisor Council member, who calls Gen Zers "young" and "scrappy." It has become easier than ever in the 21st century to forgo location-dependent jobs and run your own business or find remote work instead. Like Sun, Bera would work during summers to generate the greatest possible income: as a temp, in a hotel, at a livestock show. In 2013, she launched her own company, Gen Y Planning, and has been able to create opportunities for herself that she says would not have seemed possible nine years ago, including being able to take three months of vacation per year. Choosing the right project Of course, people may start side hustling for any number of reasons. Jaime Sullivan, a fourth-year political science student at Boston University, started to design and dye clothing for fun during the pandemic. "Then I realized I was going to bleach my entire closet if I didn't find a productive outlet," she explained. "And so, I started selling to friends online and realized that there was really a market for this type of thing." Jaime Sullivan is a senior at Boston University and the founder of social media-based store Cafe Bleach. Source: Jaime Sullivan For Sullivan, her company Cafe Bleach has always been more like a hobby for her than a business. Maybe you, too, have received compliments on something you've done or made. In picking a side hustle, Kaylene Langford, the founder of StartUp Creative and author of "How to Start a Side Hustle (Survive the Modern World)," said you should "always keep your eyes out for a better way to deliver a product or a service, or for a problem that you can solve." However, depending on what you want to get out of your side hustle — whether fun, good social karma or extra cash — getting the ball rolling and finding success may require varying amounts of forethought or research. Sun, who started her later side hustles to help her parents pay off student loans and overcome financial trouble, said having an idea is not enough to know that your side hustle will be monetarily successful. "The idea is one part — only 1% of it," Sun said. "Ninety-nine percent is your personal work and dedication to that space." Ask yourself these questions: Have you Googled the industry? What's the potential market share of your idea? Is there an appetite for the things you're looking to offer? What's your profit margin? A profit margin is essentially your total profit, or the percent of sales that are profit, after you deduct your expenses. A healthy profit margin for a small business is around 7% to 10%, according to Investopedia. So, before you go all in on an idea, it's important to make sure you know the cost of materials and how much money you could reasonably make from the services or products you're offering. Even understanding the sometimes subtle differences between "services" and "products" can alter the way you develop your side hustle. For example, service-based businesses frequently have reduced overhead costs because they don't have to stock tangible inventory like product-based businesses do. The pricing of services can also differ depending on the kind of service, the demand for it, the location and the provider's skill or knowledge level. And just like some products run the risk of never being sold, you should note that some services can become unnecessary over time. For product-based Cafe Bleach, Sullivan chooses to source her materials second hand from places that have excess stock, like thrift stores, garage sales or clothing donations. Even as costs range, however, Sullivan's prices haven't changed much since the online store opened two years ago: $25 for a T-shirt originally purchased for about $5 to $15. She's willing to take the occasional loss if it means her products remain affordable for her customers. For Kazemi, starting Circularity, which provides both services and products, was similarly less about profit margins and more about "What are my core values as a person? What do I hope to do with the skills and the knowledge that I have? How can I really make a difference with the privileges that I have?" If you are trying to figure out if your imagined side hustle is something you really want to try, Kazemi suggests asking yourself some deeper questions. You don't have to commit to any one activity right now, either. It's OK to just make some extra cash while you explore different opportunities and figure out what sparks excitement. Making things official "Too many people worry about 'How should I set this up?' and 'Do I need to open a new bank account?' or 'Do I need to start an LLC?'" Bera said about those considering a side hustle. "I think it's really intimidating when you start anything new, but the biggest thing you can do is just start." First, Bera suggests focusing on getting paid. That is, figure out how you will make it easy to be paid so that you don't waste time and miss out on money-making opportunities. After a few months, ask yourself again, "Can I make money doing this thing on the side?" Then, and only then, should you worry about bank accounts or registering your business. Certified advisors and accountants can be two especially helpful figures in navigating these early steps. "Even though I'm a financial advisor and I could do my own taxes, [hiring a good business accountant] was probably one of the best decisions I made," Sun said. "As business owners, we have to make investments." An accountant can tell you the best ways to record-keep for your business, how much spending money you have and how to set up a business bank account — among other topics. Kazemi also looked to a certified professional accountant (CPA) for help with Circularity. As a result, Kazemi said that she has gained invaluable insight into different "hacks" and legal knowledge that students otherwise might not learn in college. It's important to note that legalities of a side hustle tend to differ by state. In fact, as a permanent resident of Connecticut, Sullivan didn't have to register Cafe Bleach because she is the only employee and files taxes as herself. "For me, that [was] great because I don't want to do paperwork and it costs money to register a business, which at the time I didn't want to invest for and now I don't have the funds," Sullivan explained. She advises that you "definitely do your research on what's legal for your state and take it from there, but it's not as overwhelming as it seems." If you intend to tackle taxes yourself, Bera recommends keeping a spreadsheet of your expenses and income so that everything is simple at tax time. "There might be things you can write off like your cell phone, your internet costs, your Dropbox membership, your Adobe membership," she said. "There might be other things that you needed to buy for school anyway, but now you're actually using them for your side hustle." If you are trying to grow a business, as Kazemi is, it can be challenging. "Starting a business is really hard," Kazemi said. "You have to get funding. You have so many bureaucratic obstacles to get through. You have people doubting you." As a student, however, she was able to access many resources right at her fingertips. In her case, she used resources available through The Green Initiative Fund (TGIF) at UC Berkeley, including the hassle of incorporating Circularity and preparing tax documents. After submitting a proposal which detailed why the idea mattered, the project received guidance and a little over $50,000 to get started. Most of the money Circularity earns from guides, stickers and posters sold online is reinvested back into the business, its events and its growth. Now that Kazemi has graduated, she said she has been looking into working with venture capital firms to secure more funding and hire more people. But depending on the size and goals of your project, you may not need quite as much money as Kazemi — if any — to get started. For instance, without seed money to grow your product-based side hustle, you might try crowdfunding, or raising money by taking small amounts from as large a group of people as possible. For a service-based side hustle like tutoring, you may be able to reach your market with a single, free post to a community bulletin board. Before taking on a lot of financial or reputational risk, you might also consider testing your idea with a survey and preorders to not only locate your customer base but collect some cash to invest into early production or planning. Finding the time The three biggest challenges for side hustlers in 2022 have been (1) growing their business, (2) dealing with limited time and (3) coming up with the right side hustle idea to move forward, according to Side Hustle Nation. While Langford of StartUp Creative acknowledges that a college student's number one focus should be studying at school, just as side-hustling adults must first attend to their full-time jobs, the company founder and author said "a really beautiful part about being in your late teens, early 20s is that you're very energized." College is a time to be creative while developing your passions and find what you care about inside and outside of the classroom. Sun did so by bringing study note cards to her TV consulting job so that she could devote herself to her course work between takes. Similarly, Kazemi made time for her side hustle by treating it like a class: dedicating some free time to her passion, going to mentors with questions and allowing herself to learn from failures. "Sometimes there's no room for making mistakes because there's too much on the line. Whereas if you just started testing something, then you can pivot along the way," Langford said. As a business coach, Langford often helps clients transition their side hustle into their main hustle, though it's true that not everyone wants that. If nothing else, she says, treat your side hustle as a learning opportunity. Get out there, make mistakes and fix them along the way. Listen to your customers, get feedback and make changes. Even if your first side hustle is altogether not the right fit, trial and error will help you recognize that and make your business better for it. Getting down to business
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