How Does Pat Flynn Make Money? The Smart Passive Income Business Model Explained

Pat Flynn, creator of Smart Passive Income makes money by affiliate marketing, book sales, and course sales. He has also built niche sites that generate passive revenue streams. Additional income comes from podcast sponsorships, software, and apps. The smart passive income model purpose is to automate revenue generation.


What is Smart Passive Income?

Pat Flynn was being fired as an architect back in 2008. That is when he started to launch niche sites to earning money online. He first launched an ebook about the LEED exam (Leadership in Energy and Environmental Design). As he had studied for the same exam, he put together the info product. That is how he started to generate his first passive income. From then on, in 2008 he put together a blog – – where he shared his experiences and income reports.

How much money does Smart Passive Income make?

As of the year ending in December 2017, Smart Passive Income generated $2,171,652. Most of the revenues come from affiliate marketing; while the remaining are related to selling Smart Passive Income Info products. It also recently launched a software product called Smart Podcast Player, which in December 2017 generated $9,646.70 in revenues.

That is how Pat Flynn described first online business:

My passive income story begins in 2007, when I was employed in an architectural firm. I enjoyed my career and, in an effort to both improve my skills and my position in the company, I began studying for the LEED exam.

I needed an easy way to organize my study notes, so I bought the domain and started a blog. Each entry I made explored a topic that was likely to come up on the exam. 

and he continued:

In October 2008, I published The LEED AP Exam Walkthrough, an 89-page study guide available for $19.95.

The book sold 309 copies within the first month! Combined with advertising earnings on the website, the business earned a total of $7.906.55 in October 2008, and my life was forever changed.

The idea of creating a passive income business frees you up from the venture. In short, conventional wisdom wants you to be tied to your business. Instead, a passive income business is meant to set up in a way that you can almost walk away from it, and it will still generate a consistent stream of revenues. That is how Pat Flynn described this process:

Sales hit their peak in March 2009. Here’s the incredible part: by that point, I only needed to spend a few hours each month to keep the business running. I had purposely automated nearly every part of the business; and while I can’t completely walk away from it, I’m darn close. I spend 2–4 hours each month split-testing my conversion points, keeping up with the industry, and making sure that nothing on the site is broken.

Summary And Conclusions

Back in 2008, Pat Flynn was working as an architect for a firm in San Diego. He was laid off, so he had to figure out right away how to make money as he was also about to get married. He started a niche site, based on the LEED exam. He realized right away that to make money online; he had to bet on niches.

In October 2008 he started to share his experiences on Ever since, Smart Passive Income kept growing from $7,906 back in October 2008, up to its historical maximum at $321,642 in July 2017. In December 2017, 63% of total revenues come from advertising. While 25% comes from course sales. The remaining is software, niche sites, podcast sponsorship and book sales.

The logic behind a passive income business is slightly different from a traditional company. In fact, a passive income business is based on automating most of the processes until the maintenance required to run the business is minimal. Also, a passive income business can also be defined as a sort of lifestyle business. Therefore, it starts from defining the desired TMI (total monthly income), set up a digital business to meet those goals. In short, the passive income business caps its growth to meet the desired lifestyle.


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Gennaro Cuofano

Creator of | BizDev at | International MBA

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