What do Innocent Drinks, Moonpig and Not on the High Street have in common? The founders of each of these businesses started them as a side hustle in their spare time. Here’s how you can too.
Whether you’ve reached a ‘what now?’ or ‘I don’t want to be doing this when I’m 70’ moment, or you’re driven by a practical need to boost your income, starting a money-making sideline around the day job has a lot to recommend it.
With continuing economic difficulties and job insecurities for many, it’s no surprise that the gig economy is booming and so many of us are looking for flexible ways to supplement our main income. “Digitisation and changing consumer habits over recent years have seen a boom in side-hustles, with people launching an enterprise alongside working in employment or being in education,” says Martin McTague, national chair of the Federation of Small Businesses (FSB).
Just under half (43%) of Brits had a small business as an additional source of income in 2024 and the number of us setting up on our own to supplement a full- or part-time income rose from 33% to 40% last year, according to research by Enterprise Nation. It estimates that side hustlers typically spend 10-20 hours a week on their venture, working around the day job and topping and tailing their normal working day with an extra couple of hours during the week. And those extra hours can really pay off: the average income from side hustles is £207 a week or £900 a month.
The rise of the female founder
As well as supplementing income, there are other motivators that spur would-be small business owners into action, with making money out of a skill or hobby (38%) and ‘fulfilling a dream to become your own boss’ (24%) coming out top in an Enterprise Nation poll. The same research shows that over half of women who start a side hustle say they do so to get a better work-life balance. Frustrated by the lack of flexibility and feeling unheard in traditional workplaces, many women are leaving corporate roles, says Catherine Morgan, entrepreneur and author of Why It’s Not About The Money. “This is fuelling a wave of female founders who want a healthier work-life balance and inclusive cultures,” she says.
Currently, around 49% of men and 37% of women are earning extra income through side gigs, according to Finder. The surge in digital opportunities mean that it has never been an easier time to work remotely, allowing founders to structure their work around life, not vice versa. “These women are not just building businesses, they’re completely reshaping work cultures, collaboration, empathy, and purpose-driving missions. It’s a powerful trend that’s changing the face of entrepreneurship,” says Catherine.
Setting up a business alongside other employment might sound daunting but bear in mind that enjoying the financial and emotional stability from another job while you get started could be the ideal scenario. “This allows you to explore your business idea without the immediate pressure of generating income from it. The emotional safety net provided by a steady salary also enables you to take more calculated risks, be more creative, and focus on projects you’re truly passionate about,” says Catherine. So what’s stopping you?
Your side hustle basics
Ask yourself these five important questions before you start your side hustle.
1 What’s my thing?
Start by identifying your passion. Ask yourself: What do I know most about? What am I the go-to person for? Retail activities like selling second-hand clothes on Vinted or upcycling furniture for eBay or Etsy are the most popular side hustle (24%), according to Sage, followed by consulting or freelance writing (15%), tech-related jobs such as app development and web design (12%), and health and wellness jobs like fitness and nutrition consulting (8%).
Whether its baking, dog grooming or sharing digital skills, the sweet spot, says Catherine, is where passion meets practicality. “The key is to channel that passion into creating something people actually need or want. It’s about solving real problems or fulfilling genuine desires. When you nail this combo – a product or service you’re passionate about that also resonates with your audience – that’s when the magic happens,” she says.
“There is plenty of variety in the start-up space,” says Emma Jones, founder and CEO of Enterprise Nation, “and pretty much every idea and start-up can be started in your spare time. At a recent event I hosted, the ideas ranged from a new app to help people who are 70+ to keep their brain active to a tooth jeweller!”
Test out your idea by talking to potential customers. Use friends and family as market research; there are also lots of free online tools that make it easy to create surveys, such as Typeform and JotForm.
2 Is now the right time?
Setting up a business alongside other employment might sound daunting but bear in mind that enjoying the financial and emotional stability from another job while you get started could be the ideal scenario. “This allows you to explore your business idea without the immediate pressure of generating income from it. The emotional safety net provided by a steady salary also enables you to take more calculated risks, be more creative, and focus on projects you’re truly passionate about,” says Catherine.
3 How much money do I need to launch my own business?
You may not need as much money as you think to launch your new venture. “It’s easy to get started on a budget with low or no cost tools available that can help you with everything from market research to making sales and building a brand. As customers are looking for new products and services, this is opening up opportunities for people to start ‘niche’ businesses to service new demands,” says Emma.
4 Have I got time in my already busy life?
It’s important to be realistic about the amount of work involved in running a side hustle, but the key to success is proactively blocking out time for it.
Take a typical week and fill in a timetable of how your days are filled (family/work/household admin/fun/exercise/sleep). This will help you identify where the windows of opportunity are for cracking on with the side hustle.
Melanie Bryan, founder of Whynotchange’s biggest tip for time management is to manage your distractions: “Turn off your phone and email notifications. Things don’t require an instant response in most cases. Ultimately, you can either manage your time or everyone else will manage it for you.”
5 Who are my core customers?
It pays to spend time early on researching your audience, their behaviours and spending patterns, how best to engage with them. Find out more about the market and emerging trends, how your product/service will fill a need and your unique selling point.
You don’t just need to know who your target audience are, you need to know what marketing channels they are most likely to respond to (email, social platforms, PR, word of mouth, events). “Start spreading the word among friends, family and contacts like previous employers or colleagues. If relevant, ask if they know anyone who might need your product or service,” says Emma.
The practicalities of setting up a side hustle
Once you’ve answered these five questions, it’s time to get down to the nitty gritty. A business plan is always useful – even if you are starting very small. Not just about profit and loss, they can help you clarify direction and better understand costs in one step.
Set out a description and overview of your venture – its strategy, goals, plans for growth, the market you’re entering, who the competitors are and how you aim to make money. Fundamentally, it should answer the question – why will your business succeed when so many others fail? There’s no shortage of free downloadable business plan templates (check out the King’s Trust and Enterprise Nation).
Key aspects to cover include:
*Branding
Consider your brand’s logo and name carefully; it will be with you for years. “Your own name might be adequate for many side hustles. If you do need to devise a name, make sure it’s easy to spell and pronounce. Avoid complicated words or acronyms,” says Emma.
Check the name hasn’t been taken up by another company by visiting the Intellectual Property Office and search (for free) for registered trademarks. Also, secure your domain name asap.
*Set up & running costs
Be realistic when you estimate how much it will cost to get your side hustle off the ground in terms of set up costs (e.g. hardware, equipment and accounting software) and weekly running costs (insurance, tech, stock, marketing, taxes). Many start-ups fail because they ran out of cash or fail to raise new capital.
The best way to get a handle on costs is to talk to people doing similar things and then work on the basis that you’re operating on a bootstrap budget. “Our advice is beg, borrow and barter. Partnering with people who have an asset you need is a great way to save money. Think about what you can offer them in return,” says Emma Jones.
Your funding might come from a variety of sources, from tapping up your savings and getting loans from friends and family, to crowdfunding, bank loans and angel investors. Comparison sites such as money.co.uk are useful to check out who’s offering business loans for start-ups. There are also hundreds of government grants available, which can be a bit bewildering which is why joining a small business community such as the Federation of Small Businesses and Enterprise Nation is worth its weight in gold.
*Protecting your business
“Professional indemnity insurance is key if your side hustle involves providing advice or professional services,” says Laura Court-Jones, small business editor, Bionic, a comparison site for small businesses. “Public liability insurance should be considered if it involves interacting with the public – whether in client meetings, at events or in a physical shop. Product liability insurance is vital for any side hustle that involves selling products,” she says.
*Paying tax
However much (or little) money you think you will make in your first year, you’ll need to register for self-assessment with HMRC. It’s a legal requirement and should be done by 5 October following the tax year you started your business.
“Many people setting up side hustles will be new to the world of self-employment, so familiarising yourself with the tax landscape will be vital. You should be aware that if you earn more than the £1,000 trading allowance each year, you will need to pay tax in January and July each year, and make a balancing payment where required,” says Rosie Hooper, chartered financial planner at Quilter Cheviot.
“Set up a savings account where you can regularly squirrel away money ready to pay your tax bill when it is due. Being disciplined throughout the year and saving approximately a third of all your earnings will make the process far easier,” she says. If possible, speak to a professional financial planner to help you assess your overall position and make any necessary adjustments because of your new income.
You don’t necessarily need a ‘business’ bank account to run a side hustle but setting up a separate bank account will make it easier to keep track, particularly if you’re offsetting business expenses (e.g. travel tickets, phone calls or stationery) against your income. Some banks don’t charge fees for business accounts, such as Monzo, Starling and The Co-Operative Bank.
Ready to launch!
Walt Disney famously said: ‘The way to get started is to quit talking and begin doing’. It holds true for even the smallest of businesses. Once your service or product is ready, you need to let the world know. Make a list of all the places you could sell your service or product, from local Facebook groups to marketplaces like Etsy. It’s useful to attend networking events to build connections and generate leads.
You don’t just need to know who your target audience are, you need to know what marketing channels they are most likely to respond to (email, social platforms, PR, word of mouth, events). “Start spreading the word among friends, family and contacts like previous employers or colleagues. If relevant, ask if they know anyone who might need your product or service,” says Emma.
Q: Do I need to tell my employer about my side hustle?
A: Check your contract as some employers don’t allow second jobs or side projects or limit you from certain kinds of work (for instance if there’s a potential conflict of interest). “If there’s nothing in the contract barring you from running a side hustle, you’re under no legal obligation to tell your employer. However, it might be sensible to mention it to them. If that’s the case, explain that you remain committed to your full-time role and will only work on the business in your spare time,” says Emma.
Get support
*For a comprehensive rundown of all official support and advice available, visit gov.uk/browse/business/setting-up.
*Join a business community. For peer support, networking opportunities, advice, events, tools and services, check out the Federation of Small Businesses, relevant groups on LinkedIn and Enterprise Nation.
*The Startup Show to learn everything you need to know about setting up a new business on 25 January (Enterprisenation.com/startupshow).
*Kingstrust.org.uk (formerly the Prince’s Trust) has a useful list of where to get business advice
* Check out what own bank has to offer.
*Identify mentors! These could be people you know who are further ahead than you in the start-up journey or other inspiring women running similar businesses. Don’t be shy about asking to pick someone’s brain – most people are happy to be taken for a coffee!
*Find a financial adviser – get a recommendation from friends and family, or check out unbiased.co.uk, vouchedfor.co.uk or the FCA’s Financial Services Register.
Source: How to set up a successful side hustle
