Want a profitable online business? Too many smart business owners are leaving thousands of dollars on the table because of this. And no—it’s not some secret funnel hack or how to grow your Instagram following.
The real issue is the constant pursuit of passive income. More importantly, it’s the starting and stopping around passive income—because most of us jump into it way too early.
I see this all the time working with six-figure, multi-six-figure, and seven-figure business owners—especially those with less revenue to support it. Honestly, I have a selfish reason for talking about this: I want you to make more money. And the reason I want you to make more money is because I want you to hire me. I want to be able to provide a confident ROI on your investment.
But let’s be real: do you know how many $17 e-books you’d have to sell on your blog or Pinterest to make hiring me a good investment? Way too many.
Selling services is such a huge advantage. A high-ticket offer—whether it’s a one-on-one service or a group program—creates real, sustainable revenue. These aren’t the flashy “low-hanging fruit” offers you see all over Instagram, but they’re the ones that work.
So today, I want to have a real conversation about why people move into passive income too early, the mistakes they make, what it actually costs, and why you can build a really chill, really profitable service-based business without the chaos.
Nobody talks about this—but I will. Let’s get into it.
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Table of Contents
The Role Of Passive Income in Running a Profitable Online Business
All right, you guys know I don’t bury the lead. Today we’re talking about that shiny little thing everyone’s chasing: passive income.
And here’s my take—this obsession is costing you thousands of dollars, maybe even tens of thousands. I know that sounds dramatic, but after eight years in business, and over five years working B2B, I’ve seen it play out again and again.
I know why you do it. You’ve heard all the promises:
- Make money while you sleep.
- Sell one course to hundreds instead of coaching one-on-one.
- Automate your business and live on the beach forever.
- Whip up a Canva e-book in 15 minutes and just “sell five a day.”
It sounds dreamy, right? I’ve fallen for it too—more times than I’d like to admit. The promise is incredibly compelling.
I’m not anti-passive income though…
And listen, I’m not anti–passive income. For the sake of this conversation, when I say “passive income,” I mean those lower-ticket business models that require high volume and a ton of upfront work—like eBooks, templates, GPTs, or similar offers.
The fantasy is simple: you’ll put one of these products out there, set up a ManyChat automation, tell people to “comment the word,” and watch the sales roll in.
Now, I know you’re probably thinking, “Well, I’m more level-headed than that. Obviously it doesn’t work exactly like that.” But still—the promise is so alluring.
And I get it. I wanted to have this conversation today because I mentioned it casually on my stories—how I think people jump into passive income too early—and I got a ton of questions. So here we are.
Passive Income Requires More Active Work Than You Think
Here’s the thing: we all know that courses, memberships, and digital products take a ton of upfront work. It’s not just creating the product—it’s launching, building a list, nurturing your audience, following up, and handling customer support.
And honestly, the customer support piece is way more intense than most people realize. Behind the scenes, even before you’re making “bank,” you’re fielding multiple emails a day:
- “I lost my link.”
- “The login isn’t working.”
- “Can you reset my password?”
- “My payment failed.”
Which, quick aside—I always assumed failed payments were automatically retried by the system. Sometimes that’s true, but in a lot of cases it’s manual. That means when someone’s card is declined, the business owner is actually notified and has to handle it. I had no idea that was the case until I started seeing it behind the scenes.
Digital Product Expectations in 2025
So when people glamorize “low-ticket passive income,” they rarely talk about this hidden workload.
And that’s just one piece of it. The customer support side is huge. You’ll hear things like:
- “I thought this included XYZ.”
- “What about my specific situation?”
- “I can’t find my login.”
It’s constant.
In fact, I was on Threads the other day and saw something that really stuck with me. A friend and I were talking about it: basically, if you’re selling anything over $97, the public expects some sort of one-on-one access. Not full-blown coaching, but at minimum responsive, quality customer service.
And here’s where it gets awkward. When your business is just starting to make a few passive sales, you don’t yet have the volume to support the expenses that go along with it—the higher-cost software, maybe a VA to handle inquiries, or other operational tools you’ll need. So you’re stuck in this middle ground where the workload is heavy, but the revenue isn’t there to truly sustain it.
The Financial Side of Pursuing Passive Income (When Running a Profitable Online Business)
We talk a lot about the time investment for passive income, but not nearly enough about the financial investment. These things cost money. Yes, you can bootstrap, but I promise—that path usually leads to frustration, burnout, and hating the process.
So here’s what I see happen all the time: someone decides they want to go all-in on passive income. They scale back their services—or maybe they weren’t selling services to begin with—because they’ve bought into the narrative that “selling services is hard” or “no one has money.”
So instead, they decide to create a course. They rush through it, eager to get it to market because they need cash quickly. But when the results don’t come fast enough, they pivot. They tweak. They rebrand. They spend more money—sometimes on ads—only to push it all to the back burner when revenue doesn’t show up.
At that point, they return to what actually brings money in—higher-ticket offers like strategy calls or done-for-you services. And then the cycle repeats itself.
The truth? None of us want to live on that hamster wheel. But I also get why we fall into it.
The Myth of Trading Time For Money
As service providers, we’re constantly told that “trading time for money” is the worst possible thing you can do. It’s painted as the ultimate failure of entrepreneurship. And yes, I understand where that comes from. But here’s what I believe: if you’re in the earlier stages of business—let’s say anywhere from zero to five years in—services can actually be your strongest, most profitable foundation.
Even for me—someone who’s more established, with clear methods and a proven business—if I wanted to push hard into passive income right now, it would still be a ton of work. And honestly, I’m not prepared to do that.
I’ve seen this play out with a lot of entrepreneurs. There’s even a name for it—I think it’s called the “curve of incompetence” or something along those lines. At zero, you know nothing. By year one, you’ve learned so much that you feel like you know everything. Then, as you go further, that curve dips back down as you realize just how much you don’t know.
That’s where I feel like I am now. On one hand, yes—I could argue I’m established enough to take on more passive offers. But I also know the reality: it’s a volume game that requires an enormous amount of upfront work, and I’m just not willing to pour that level of energy into it right now.
You Can Have an Extremely Profitable Online Business Offering Services
Here’s the other piece no one wants to talk about: services can be incredibly lucrative. My revenue is much higher selling services. I run a bit of an agency model, which means I can scale because I have help with delivery.
So let me be clear—services absolutely can scale. You can build a business that makes excellent money without working yourself into the ground. Yes, you’ll still work—but it doesn’t have to mean endless hours chained to your desk.
When you’re in the earlier stages, I really believe it’s smarter to focus on services. Not only do they bring in more consistent revenue, but they also give you more experience actually doing the work.
Take me, for example—I don’t run a boutique business where I charge $10,000 for copy and work with one client a month. My business is higher-volume. Right now, I have around 40 one-on-one clients, supported by my team, and we’re doing things like blogging and Pinterest management.
Because of that volume, I get to test strategies, see how things perform, and gain a much broader perspective than someone who only has two or three clients at a time. If you only have a handful of clients, you don’t have much data to draw from when industry-wide changes happen. You might think, “Oh, everyone’s slow right now,” but really, you’re basing that on two accounts. With a larger client base, I can spot real trends—like seasonal slumps—that give me deeper insight.
That experience is invaluable. And when your audience is still small, services are hands-down the fastest, most sustainable way to generate steady revenue.
My Own Experience Selling an Ebook
Here’s a concrete example: I do actually have a passive product. For my destination wedding business, I created a $27 eBook. We don’t actively promote it—no Instagram posts, no ads—but we get about four to five sales a month just from website traffic.
I last updated that eBook in 2023. So let’s do the math together: $27 × 4 sales × 24 months = about $2,592 over two years. Yes, it’s passive. Yes, it’s nice to see those sales come in. But when you compare that to what I earn selling services, it’s just not even close.
Some of these products are also due for updates. And let’s be honest—that’s not a quick process. Updating something properly could take me two or three full days: reviewing all the pages, making sure the content is current, adding in new insights, and in my case even doing research since I don’t work in destination weddings directly. That’s a huge time investment.
And here’s the question I always ask myself: is that really the best use of my time? Even with consistent traffic, I’d have to weigh the time I’m pouring into it against the return. What’s my true hourly rate from this product? Because it’s easy to say, “Oh, I built it once and made $2,500.” But in reality, it’s not a one-and-done situation—it requires ongoing maintenance.
Now, I don’t sell huge volume, which means fewer customer service requests. But let’s say you’re selling 10–20 units a month. That’s maybe $500 in revenue, but you’re still going to get support emails and customer management at that point.
And if you want to scale? That’s another layer. Are you posting a ton of TikToks? Pumping out Instagram content? Paying someone to run ads or help with traffic? There’s always an additional cost.
To be clear—I’m not anti–passive income. It’s absolutely a viable business model. But it requires a massive upfront investment of time and energy, and I know personally I can make more money, more sustainably, through services.
Choosing Services Over Passive Income
In fact, my friend Colie shared a great episode on her podcast, Business First Creatives, about why she decided to shut down her template shop and go all-in on a “done-with-you” service model. And I loved that. Because it’s not that we can’t do the passive income thing—it’s just asking ourselves, why wouldn’t I lean into the thing that makes me more money and that I actually enjoy?
I think the key is finding a service you enjoy and recognizing that, yes, you’re technically trading time for money—but that’s not all bad. In fact, you can earn an excellent hourly wage, enjoy real flexibility, and build the kind of freedom you want with a service-based business.
And if you’re listening and thinking, “Kara, you’re right. Maybe I’m not ready for passive income yet, but that’s absolutely where I want to go one day”—that’s great. Services can give you the cash flow to reinvest, the experience to refine your skills, the clarity to shape your offers, and the proof of results that make future sales so much easier. You’ll build a reputation, and while you’re serving clients, you’re also growing an audience and brand awareness.
The problem is when we get in our own heads:
- “I shouldn’t have to be on calls.”
- “I need to scale faster.”
- “I’m falling behind because I’m not selling a course yet.”
That kind of comparison can get overwhelming fast. So if you take one thing from this conversation, let it be this: even if you want a passive income business eventually, just know it takes far more time, money, and effort than most people realize. Starting with services gives you stability, cash flow, and momentum to get there without burning yourself out.
Scale Your Services For a Profitable Online Business
And let me remind you—services do not lock you into a lifetime of trading time for money. You can:
- Build systems.
- Raise your rates.
- Offer VIP days.
- Hire a small team.
- Turn a validated service into a product.
- Or add in strategy sessions that stand alone.
There are so many ways to scale services into something profitable and freeing. With that demand, cash flow, and practice selling, you’ll have way more energy and resources later to build that course, launch that membership, or create those templates—if you still want to.
And honestly, you can just enjoy your life as a service-based business owner. That’s what I want you to know.
If you have questions, loved this conversation, or even disagree with me, DM me—I’d love to chat. I know this is a nuanced topic, and people have strong opinions about it, which I actually love. But from what I’ve seen, constantly slamming on the gas and then slamming the brakes while chasing passive income is costing us real money. Especially when what we actually need is cash flow now, not a hope-and-pray course launch six months from now.
So thank you for being here, I appreciate you, and I’ll talk to you next week.
LINKS MENTIONED
- Learn more about working with our marketing agency here
- Listen to Colie’s episode about moving away from passive income
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