I have seen lots of articles about passive income experiments. Many of these experiments end with the conclusion that passive income isn’t possible. I agree, true passive income – income that requires no work to generate – is probably very difficult to achieve. Semi-passive income on the other hand, is much easier to generate and maintain.
I have been selling products on Codecanyon for 3.5 years. During that time I have consistently generated around $1k – 2k a month with very little day to day work. My worst month this year was $991 my best month was $8,376.
I call this income semi-passive because I spend about 30 minutes every day responding to support requests and pre-sales questions.
My Codecanyon sales for the last 3.5 years:
This certainly isn’t a huge amount of money, but most months I make enough from Codecanyon to cover my mortgage and recently it has been enough to cover my massive student loans as well.
As a freelancer, this consistent and guaranteed income creates peace of mind because I know that even if I can’t find any clients in a given month, I’ll still make enough money to pay for my basic living expenses.
Here’s my strategy for selling on Codecanyon:
- Release big ‘products’ rather than plugins – Products make more money than plugins or small components of code. The only case where this isn’t true is wordpress plugins. Honestly, I have no idea if this is true of the marketplace as a whole, but it’s been my experience.
- Release at least one product a year – As a product ages, it generates fewer sales, which makes releasing new products important.
- Focus on design – Ugly products do not sell well. At least 30% of my time is spent designing the product. My design process is probably a bit different from most developers – I don’t use photoshop at all. Everything happens directly in the browser. I’m not sure if this is faster or slower, but it works well for me.
- Build things that you want to use or solve a problem that you personally have – This is the only way I’m able to come with ideas. I have many needs that aren’t adequately met by existing products. I assume other people have these same needs, so I build a product that attempts to fill the gap in the marketplace. This is how Duet was born (and my previous two attempts at a self hosted pm solution). This also makes it easier to invest the time required to build the product.
- Provide basic support for your products – This is what makes the income semi-passive, rather than passive. If you don’t provide support it will reflect poorly on your brand. Customers will also leave nasty comments on your items on codecanyon, which will negatively impact sales.I keep the amount of time I spend on support managable by only providing basic support. This means that I only answer questions about how to install the product and how to use the product. I do not provide any support for modifying the code or integrating with other products. I simply don’t have the time to answer these kinds of questions. This probably keeps me from having a 5 star rating, but it really doesn’t matter in my experience. 4 star products sell fine.
That’s it. I experimented with external landing pages for my products but they didn’t appear to have any real effect on sales and there was no way to measure their performance. Codecanyon recently launched google analytics for elite authors so I may experiment with landing pages again at some point in the future.
The biggest obstacle is going to be building your products. It takes a lot of time. I usually work on them in between client gigs.
More on Codecanyon
Codecanyon has a bad rap – primarily for the large percentage of each sale that it takes. 50% for new authors, but it gradually goes down to 30% as you sell more items. This percentage is definitely high, but I don’t think it should matter. Just think of it as your marketing costs. Codecanyon has massive reach. You’re unlikely to replicate this reach on your own and therefore unlikely to sell as many products on your own. I would strongly prefer to take home 50% of a big number than 100% of a much small number.
It’s possible to make a non-trivial amount of semi-passive income from Codecanyon. It’s relatively easy to do if you’re building things people (like yourself) need. Codecanyon’s percentage shouldn’t be a deterrant.
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*$76,841 divided by 3.5 = ~22k