If you’ve been reading this blog for a few years, you know the journey I’ve gone through: In October 2011 I left a startup job (making $60,000/year) to freelance and build and sell products. 2012 was an amazing year where I built this blog, wrote two books, and doubled my income.
So what happened in 2013? Well, it’s the year that the benefits from what I built really started to snowball. I launched two books (Authority and The App Design Handbook, iOS 7 edition) and my other books continued to sell well.
Enough summary, let’s jump in starting with the money and products.
Income Report
Consulting
Just last year a large portion of my revenue came from consulting. In 2013 I didn’t do any and that felt really good! I may do some more in the future, but for now it feels really good to not have any clients. I have a little consulting revenue to report, but it is all for work done in 2012.
Consulting revenue: $12,917
Now on to product sales.
Note: all book sales numbers are after credit card processing fees.
The App Design Handbook
Launched September 9, 2012
The App Design Handbook was the book that started this entire journey for me. Most of its sales happened in 2012, but in 2013 it sold $19,247 through my site.
- Gumroad: $19,247
- MightyDeals: $2,911
This fall I worked with Jeremy Olson to launch a new edition for iOS 7. That book was a runaway success ($36,000+ in 24-hours) and has continued to sell well.
Launched November 6, 2013
- Second edition: $55,410 (split 50/50 with Jeremy Olson)
- My share: $27,705
My total: $49,863
Designing Web Applications
Launched December 12, 2012
Always my bestseller, Designing Web Applications continued to do well this year. Despite receiving the least attention it made the most money. Here’s the breakdown:
- Gumroad: $66,542
- AppSumo: $8,091
- MightyDeals: $3,138
Total: $77,771
Authority
I launched Authority in May of this year and have been pleasantly surprised by the sales. It hasn’t sold as well as my design books, but product marketing isn’t the main focus of my audience. It was a super fun book to write and made me $66,478 in 2013.
I only promoted it on my own site, so all those sales came through Gumroad.
Total: $66,478
Workshops
I taught two workshops with Brennan Dunn in London and Boston. London we sold out 25 seats and had a really fun time with a big group. Boston we didn’t market very well, so we just had 6 attendees. It was a totally different vibe and I actually enjoyed it more with just a small group around a conference table.
- Building Profitable Audiences – London: $3,867
- Building Profitable Audiences – Boston: $1,000
- Designing Web Applications: $2,892
Workshop total: $7,759
Not bad for getting paid to speak and travel! Next year I expect that number to be significantly higher.
Building Profitable Audiences (Community)
Just a few weeks ago I launched a community for people who have read Authority and are taking action. It currently has 20 members, each paying $100/month. So it made $2,000, but that will continue to be monthly recurring revenue.
Already the community is growing strong and I’m excited to see what each of the members do in 2014.
Total: $2,000
ConvertKit
The ConvertKit numbers actually surprised me with just how low they are. Other times I had been looking at projected numbers or what had just been invoiced. But this shows exactly what I made accounting for refunds (there were quite a few).
- Preorders: $3,826 (after fees and refunds)
- Recurring Payments: $10,998
Also none of this is profit. I spend every penny ConvertKit makes back on product development.
Total: $14,824
iOS apps
Even though they don’t make me much money, I still sell apps on the App Store. Though I sold OneVoice (more on that later) which makes up the majority of my iOS revenue. In 2014 I will just have Commit making me money, so I don’t expect meaningful revenue checks from Apple going forward.
- Commit: $3,730
- OneVoice: $7,341
- OneVoice Sale: $13,000
- Fluent: $42.64 (Haha!)
Total: $24,113
LegendThemes.com
In an attempt to get rid of old projects I sold LegendThemes.com on Flippa. Because of all the themes that were packaged with the sale I probably could have sold for more, but that is still more money than I ever made from the site.
Sale: $1,000
Summary
Total all that up and it was not a bad year! I could quote higher numbers by including gross revenue, but this seems more accurate. With a few minor adjustments (some of these numbers don’t include the last week of the year) this is the number I’ll be reporting to the IRS.
2013 total revenue: $256,725
2012 total revenue: $145,471
I didn’t quite double revenue, but that’s a whole lot better than the 5% raises I was getting at my last job.
Expenses
I should add a quick note on expenses. First, those numbers don’t include expenses. Second, expenses were much higher this year. I spent over $20,000 on development, at least $30,000 on travel, $10,000 on equipment (computers, camera, lights, audio gear, etc), and then plenty more on miscellaneous business expenses.
And then… taxes. Which are brutal.
What went well
Enough about money, let’s talk about some of the other things that went on in 2013.
Speaking
In my 2012 review post I wrote that I wanted to do more public speaking. Auston Bunsen, the organizer of SuperConf in Miami read the post and invited me to speak in February. That made for my first paid speaking gig.
After that I went on to give an attendee talk at MicroConf in Las Vegas, and then Amy Hoy invited me to speak at BaconBiz in Philadelphia. I then hosted workshops with Brennan Dunn in Boston and London, and closed out the year by keynoting the Idaho Book Extravaganza.
Speaking is a great example of wanting to make an improvement and then seeing a big change. That should continue into 2014 since I already have two talks lined up in March and April.
Exercise
Last fall I joined a local CrossFit gym that I’ve been really enjoying. I find exercise to be a great break from everything I’m doing on the computer. Often when I am just not making any progress on projects I can head to the gym and fix the day with a great workout. It’s also really easy to track being able to lift heavier weights and do more pull-ups (I can now do 17 in a row!), which makes it more fun.
I also took up indoor soccer this year, which has been a blast! Growing up I never played organized sports, but I’ve made up for that by joining two soccer teams and playing twice a week in the spring and fall. Though I’d never played soccer before this year, so it’s been frustrating at times since I am so bad at it.
Then over the summer I played a lot of ultimate frisbee, which is always a good break from soccer when I want a reminder that there are some sports I’m good at.
Audience
In 2013 I really learned the benefits of having an audience. My list grew from about 5,000 to nearly 15,000 over the course of the year. I also learned a lot of new techniques (email courses promoted with guest posts) and some new channels entirely (Twitter ads).
I expect my email list to double again in 2014. I have some great things in place like a free book on the Gumroad home page that continue to drive new subscribers.
Writing
I continued my streak of writing 1,000 words (or the equivalent in another media) for each day. That means I missed a few days, but always caught up later. My streak continued past 500 days in a row and I am now at 510 days in a row. It’s still the best decision I’ve ever made. I plan to keep it going until I’ve checked off a few more major writing goals.
Though lately that has taken the form of video recording for a few new projects. Which I can’t wait to share in the coming year!
Travel
I had so much fun traveling this year! My favorite trip was a one week jaunt across Norway to help my friend Chris Guillebeau celebrate visiting every country in the world. The group I met during the trip was fantastic and I got to meet up with a bunch of old friends (who I also saw a couple months later at The World Domination Summit).
I actually made it to Europe three times in 2013. First to Norway for Chris’ birthday. Then to Germany, Austria (love the alps!), and the UK with my wife and son. And finally back to the UK (London) and the Czech Republic (Prague) in October for a workshop and MicroConf Europe. That was another great trip where the perspective gained from conversation over drinks one night more than paid for the entire trip.
Here’s the list of where I went (sort of in order): Costa Rica, Kansas City, Miami, Kauai, Las Vegas, Oslo, Bergen, Philadelphia, Munich, Salzburg, London, Oxford, Portland, Seattle, London (again), Prague, Vermont, New Hampshire, Maine, Boston, and San Francisco.
Flying powered gliders in Hawaii with Hilary’s brothers Philip and Daniel.
Another baby!
Oliver is going to have a baby brother, due May 8th, 2014! I always wanted to have several kids and so I wanted them to be close together in age. They’ll end up being about 2.75 years apart—which is more than I wanted—but that was out of our control.
It’s really exciting to be having another baby. I’m sure I’ll freak out a bit later. :)
What did not go well
Never as much fun as the previous section, but just as important.
Travel with Oliver
My wife and I have had many successful trips with Oliver taking him all over the world. Unfortunately we had our first bad trip. Now that he is getting a bit older (2 years old) it’s been harder to take long flights with him. Costa Rica went fairly well, but the longer flights to Europe were really challenging.
When we went in 2012 he was nine months old and slept most of the flights. This time we were lucky to get an hour or two of sleep on an eight hour flight. Not my idea of a good time.
After that experience—and now that we have to pay for Oliver’s flights—we are going to stay a little closer to home for a while. I took a few trips since then, but Hilary and Oliver stayed home.
Meet crocodiles in Costa Rica in January, 2013.
We do have another trip planned to go sailing in the Florida keys (takes two three hour flights), but other than that we are taking it easy on travel. It’s much less stressful to travel with family (like on this sailing trip) so we may do that for the next couple trips.
OneVoice sale
In an attempt to focus on my products that serve my audience I decided to sell off OneVoice and LegendThemes.com. Two products that made a tiny bit of money, but didn’t serve my core audience at all. I listed both on Flippa. LegendThemes ended up selling for $1,000, which I was quite happy with.
For OneVoice I was contacted by a buyer outside of Flippa. He offered a quick deal for $13,000 (I actually screwed up that negotiation. Ask me sometime how I lost $1,000 in 5 seconds). After a nice quick deal everything started to go downhill. The payment took about 2 weeks to get sent and clear my account. But I got it. That’s when things really got weird.
Despite all my attempts to deliver the app, the new buyer never transferred it to their iTunes account. Who pays $13,000 for a product and then never accepts the transfer? Whatever.
But to make it worse about a month after the sale iOS 7 came out and OneVoice needed updates in order to work with the new version. The new buyer knew this, and kept saying he was going to transfer the app over and use the developer to release a new version. But it never happened.
I actually wasn’t sure how to respond. I responded to individual emails from customers that still were sent to me, but I remained entirely on the Facebook page. Despite still having access, I didn’t legally own anything. I was quite worried about the legality of posting to a Facebook page and email list that I didn’t own anymore.
Finally after hearing too many stories of the broken app from customers—and realizing the new owner wasn’t going to update it—I got a developer working on the fix. I thought the new owner would be good for the money, but if not, I promised the developer I would pay him.
Eventually an update was released, customers got a working app, and unfortunately the name of the app is forever tarnished. The app still sits in my iTunes account and the new seller has not transferred it over. Overall it was a stressful situation that still has be confused. Hopefully it will get resolved in 2014.
Sickness
This annual review was supposed to go out over a week ago, but I got sick. Then my wife got sick. Then my son got really sick. Those back-to-back illnesses made for a rough Christmas and meant I didn’t get any work done for an entire week.
Taking care of a completely miserable two year old is… well, miserable. I basically spent several days just walking around holding him. He would only sleep if he was being held, so that’s all my wife and I did. Luckily the illness only lasted a few days, but… wow. It was rough.
On the bright side, self-employment is awesome. I went into the doctor when I was sick and was asked if I needed a doctors note. That made me smile. When I responded, “No, I don’t.” the doctor looked a little surprised. I could have explained that I write books and a blog that make far more than a doctor’s salary, but it was easier to just say “I’m self-employed.”
That’s what’s great about self-employment: I was able to be completely out of it for a week and sales still came in. I still made money, I didn’t let anyone down, and I still have my “job”.
Taxes
Paying so much more in taxes was very painful. Not just because the dollar amount was so high, but also because I didn’t keep very good records so it took a lot of work to my taxes. Normally taxes are due on April 15th, but this year I filed an extension so that I would have until October 15th. Can you guess what day I sent in my final taxes?
Yep, October 14th—which was a holiday, so they ended up being postmarked October 15th. Turns out I’ll procrastinate as long as possible.
On October 14th I was sending it estimated payments (I had gotten behind) as well as the last payment for 2012, which meant mailing 5 separate checks (including state and federal taxes). I started to complain to Hilary about the waste of having to use so many stamps, until I realized the irony of complaining about $1.50 in stamps instead of the $60,000+ in tax payments.
Finances
Despite making as much as I did in 2013, I don’t have that much (relatively) in my accounts right now. The biggest reason is I spent a lot of money. Yes, taxes took up a lot, and we gave away a lot, but I still would have expected to end the year with a larger bank balance than I have.
Even though I promised myself this wouldn’t happen, my standard of living increased along with my revenue. At least for the most part I spent money consciously on things I care about like travel.
Looking forward to 2014
The first thing I am doing for 2014 is not planning for the entire year. Instead I am just making revenue and product plans for the first three months. I just can’t accurately predict anything a year from now, so I’ve learned to stop trying. Instead I’m setting actionable (and secret) goals to be completed by March 31st, 2014. As that date gets closer, I’ll start planning for the second quarter.
Here are a few high level goals for 2014:
- Get a team and processes in place to run more of my business.
- Launch at least 3 new products.
- Give my existing products the marketing and attention they deserve.
- Continue to create new content every day.
- Take time off.
This post is getting really long, so I’m going to stop there. But before I sign off, I want to say thank you. Thank you for reading this blog and partially enabling this crazy, wonderful life I’ve been able to live!
If you want to follow along with my journey in 2014, sign up for my email newsletter below.
Very inspiring. Can’t wait to see what you do in 2014.
Taxes… man. That’s rough. I’m glad you broke it down, though. Everyone says how much revenue they bring in, but no one talks about how much they make/spend/save.
Keep it up!
-B
Congratulations on your successes! This is an awesome post and very inspiring. Thanks for sharing so many details!
Way to go on all your money making! Even though you did have some down points it sounds like you had a really great year. I’ve been following along and I really enjoy your content. Thanks so much for offering up so much of it for free in emails. I too got sick over Christmas, and had to work through it, because i design for a corporate retail company who only gives their employees one day off for christmas. I hope 2014 is an even more profitable year for you!
Thanks for the update Nathan! What an interesting life. I’m looking forward to meeting you in March at Pioneer Nation. Thanks for the inspiration!
One thing you left out w/ what went well is that you became a bona-fide ‘thought leader’ on many fronts inside the online marketing and digital products field in 2013 – not a small feat.
From outside observation(your blog, buying and using some of your products, reading guest blog posts, etc.), much of the momentum created in 2013 had its roots with finishing 2012 strong,if I’m not mistaken.
Though that is always the case with forward movement and momentum – it’s the compounding effect of previous efforts that creates a perception of ‘sudden success’ but it’s always far, far from it.
Congratulations on all your significant accomplishments and I look forward to following, learning alongside you(I’m 25 yrs into working for myself now) and supporting your product creation efforts when they intersect with my needs. :-)
That’s true. I think the public speaking is a sign of being seen as a thought leader. It just comes from teaching things as I learn them.
I always get inspired by your articles and stories.
Thanks for sharing the transparent yearly reviews.
Congrats on your success and sharing so openly Nathan, lots of lessons here. Having recently discovered you and having gifted the Commit app twice I look forward to the value you have yet to deliver.
Also, my wife and I are taking our two kids (2yrs & 10months) to India on Jan 16, hope it goes better than Oliver did to Europe!
Them’s a lotta taxes!
Nathan,
Congratulations on your incredibly well deserved success. I bought two of your packages this week and spent most of my holiday devouring them. I feel like (this week) I know you, but of course I do not!
As an aside, you mentioned in Authority about granting interviews when you are asked. Just so you know, that works! I stumbled across you on a podcast where you were interviewed. I won’t say which one because while I respect and admire the Podcaster, his style wasn’t for me – but I will be forever grateful to have discovered your work. I will be a customer of nathanbarry.com for many years to come.
Last but not least, that is just crazy about the OneVoice transaction. It must have been incredible stressful. Good lesson to have a clause in the contract that, until the App is transferred, you have the right to maintain customer relationships and FB page, etc.
Looking forward to keeping up with you in 2014.
Best,
Nanci
Wow! That is indeed a detailed update for a year! :) I wish I’d be able to write in such a clear way all this.
Thanks for sharing it, Nathan!
Very Inspiring Nathan! Thank you so much for sharing. I wish you many more blessings in the year ahead!
Awesome – love the breakdown. Congrats on a great year Nathan. Really looking forward to see what everyone else does in the BPA community for 2014 as well!
I always look forward to your blogs and after buying Authority it’s clear to me that you are the real deal. Fantastic job mate. Here’s to a great 2014!
Good work! What app do you use to track your writing streaks – it looks great!
Commit: https://itunes.apple.com/us/app/commit/id473527073?mt=8 (I made it)
Nathan,
Thanks for the write up. I’m really curious about your tax numbers. 60k on ~250k in revenue? Do you have an accountant? Are you running earnings through an LLC or company?
Thanks again for sharing!
-t
Yes I have an accountant. No, I don’t have an LLC. Still working on getting things setup properly.
Look into an S Corporation to potentially reduce self employment taxes if you want to do payroll.
Is it a CPA or a bookkeeper? A great CPA would have ensured you had a LLC in place and paid less taxes based on where your revenues are coming from. Income from books (created intellectual property) is taxed differently (more favorably).
I’m not a CPA, nor do I pretend to be one on the internet. :-) I know enough to say you may want to consider having someone else help you plan better for next year.
It just a high percentage considering passive income has much better tax break opportunities than earned income.
That aside, awesome year! Bravo!
Each of the properties you are developing should be there own entities so that you can maximize the expenses, and use the payments as dividend income which if managed correctly can be taxed at a much lower rate.
You should consider all your assets as a portfolio, and each can provide income as ROI rather than ordinary income.
Definitely talk to your accountant as you should be moving as much of the income as possible into long-term capital gains investment portfoils as soon as possible so that you can maximize your productive years and continue to enjoy your new freedom for many years to come.
Great post. Good luck in 2014 and Happy New Year!
Hello, Nathan, thanks for your review. It is very inspiring to me! Good luck in 2014!
Congratulations on what sounds like a very busy but really exciting year. Its your blog posts like these that are so inspiring to me. Best of luck for 2014 and hopefully I can join you in the self-employed world in the near future:)
Thanks for sharing all the details. You’ve had a great year!!!
Very decent of you to share actual numbers. Taxes are the devil.
Hey Nathan, thanks for being so transparent and sharing all of these details with everyone. It’s so helpful to hear what’s worked, what hasn’t, and what you’ve been measuring. You have a special ability to learn, reflect, and share with others that draws people in to want to listen to what you have to say (and to be a part of it, too!)
Here’s to a fantastic 2014–can’t wait to see and hear what’s around the corner for you and how you respond. :) I’m sure it will be simply wonderful. I’ll reach out to see if I can help in any way, especially as your new little one arrives in May (woo hoo!!)
Congratulations Nathan on a great year and some great products!
I wish more people your age would understand the tax structure and how it punishes success. I’m so tired of hearing about paying your “fair share” from the Occupy crowd. I’m sure it sounds like a super idea until you’re the one who actually works your butt off and earns a decent income only to have a huge portion of it confiscated. 2014…time for some tax planning.
Continued success!
Yep, I plan to make this year much better tax-wise than previous years. I actually have a CPA and should be making improvements.
Great post. I was trying to subscribe and I got an error. I thought you might like to see it: http://postimg.org/image/cmuy69a21/
Really great post nathan, I’m from italy and your great fan. I play soccer and make crossfit,too !! However I’ve a question for you: when do you come to visit Italy?? It is really beautiful!!
Silly question, but what app is that you’re using to track how many days in a row you’ve written?
Hi Nathan, first time to your site but this is a fantastic and inspiring post. Just a quick question: which app do you use to maintain your writing chain? The one with the big green button? I’d like to give it a try.
Ah, looks like it’s Commit! I should’ve checked that before asking..
Make a shell company in another country. Google, Facebook, Apple do it, and so should you.
Congrats man! Thank you for sharing these details.
Freelance can really be an option instead of working for big companies if I move to America.
Wow, really inspirational post. I am a designer/product manager with a great job but love the freedom that going freelance would provide. My wife and I are having our first son next year (also due May 8th, 2014 coincidentally) and missing the big moments is concern. Anyways, really great to see a detailed explanation of the pros and cons.
Thanks for the post.
Nathan, thank you for being one of the few stand up guys on the internet.
You are extremely humble and hardworking.
Much respect and thanks for the motivation!
Nathan: can you describe your business structure? Is it a sole proprietorship, S-Corp, or something else?
Thanks for this update Nathan. It’s really inspiring and I hope to have such inspiring year in my life too in 2014.
This post is awesome and very inspiring.
Thanks for sharing so many details!
Hope your 2014 will go well :)
Inspiring stuff, Nathan, thanks for being so transparent!
You have quite a diverse range of products now (training, ebooks, apps etc), so I wondered if you had a preference for one particular type and why?
Incidentally, I’m not sure your newsletter subscribe form is working — neither the one on this page or the one on your /newsletter/ page is letting me subscribe.
I really just have ebooks, 1 iOS app, and ConvertKit. Ebooks are my current favorite kind of product.
Nathan, congrats on a great year. Thanks for sharing. I’ve been following your journey for about 18 months now since I was Googling around for people who quit their jobs to run their own business.
Fast forward to now, I quit my job (I finish today), and I’ve got 30,000 words of (unedited) words for my first book where I’m following the Authority plan.
Thanks for the inspiration! All the best for 2014!
Congrats! What’s the book on?
It’s on how to become a WordPress Consultant on the side of a day job (niching down to ‘getting started’ rather than running a full agency) – The WordPress Business Kit.
I’m following the Authority method exactly. I hope to be a success story for you.
Now the hard part, getting people to agree to do interviews, editing and marketing!
I find writing 1,000 per day easy. Editing however is very difficult for me. Any tips specifically on editing would be appreciated!
Thanks.
Wow. Your story is very inspiring and encouraging.
I dream of not having clients and only products… that’s my goal for 2014.
Anyway, thanks for sharing and best of luck for the new year!
Everyone that thinks that is a lot of taxes, it is really only 24% which I bet most of you pay, if not more. It just hurts more when you see it as a lump sum (and as a percentage of $250k!!) Especially hurts in the US where you get seemingly little in return.
Great post, thanks for sharing all of that info!
New reader here. Great review mate!
As a personal finance blogger, I’m fascinated with numbers. We always say it’s not what you make it’s what you keep. With $60,000 in expenses and $60,000 in taxes, that still leaves you with $120,000 in income right?
Can you share how much your bank account actually went up and what you plan to do with your money e.g. invest, pay down debt, etc?
Cheers,
Sam
Nathan, I love your transparency, authenticity and detail!!! It builds trust and models what I like and want to do. Well done!
Audie
Hi
This post is really great and inspire me a lot to create my own product. This year I also write few books and sold on amazon.com. I think I will continue and looking in someplace to sell my book and product. I hope that I can make some team and grow my business as you do too.
Thanks
Man, this is incredible. Total focus. I know that’s what it took. Insane Intense Focus.
I know what it means to have a full plate (3 companies I’m personally involved with, a blog, and I just got married which includes a son ha!)
Thanks for the inspiration of focus with your post.
Thanks for sharing, Nathan! I’ve learned a ton from you this year, mainly about teaching everything I know and focusing on email more than social media to sell products. It’s especially inspiring to see your numbers for book sales, as I’m hoping to write a book myself someday.
Hey Nathan,
First time visitor to your blog, just found out about it from Tung over at CloudLiving.com.
This is an epic post and your blog is great. I’ve just started a new blog at http://www.nichehacks.com and one day I aim for it to be as awesome as this one.
It’s good to see someone REALLY delve into what they’ve done throughout the year not just online but offline too. Nice touch.
Keep up the good work.
Stuart
I just bought Authority today when I saw it on MightyDeals – I’d already heard of you from a friend a few months ago. So I jumped on the deal.
Really glad you wrote this blog post. It’s very inspiring. I’m looking forward to reading Authority.
Hey Nathan, I hear about you from your interview with Pat Flynn on the SPI Podcast. Thank you for sharing your journey and inspiring others to go forth and do what they love. Thank you for sharing your successes and your failures and reminding us that we are, after all human. Looking forward to hearing more from you in 2014!
Awesome.
I don’t remember anyone ever detailing their finances like that before, and it’s fascinating (and inspiring!)
Even your openness about how much each of your endeavours has made you is really interesting. I would’ve had no idea how profitable (or not) publishing an eBook or app would make.
For what it’s worth, I also went through the stress of sickness, due to our young daughters.. not least because our second daughter didn’t sleep through the night (even nearly) for the first two years. Every single night, she was awake for two hours, sleep for 30 minutes, awake for two hours, sleep for 30 minutes. For two full years. It’s a killer.
But, hey, at least you didn’t have to ring in exhausted to your boss!
Excellent site, and keep up the great work.
Inspiring stuff, dude. Only 9 months into the self-employed journey, so I am looking forward to doing my own review in a few months.
Unlike you I am still trying to map out the whole dang year. But with twins due just a couple of weeks before your’s, I’m forcing myself to just focus on the 1st quarter.
All bets are off when the kids get hear ;)
Good luck on ’14