The Case AGAINST Freelancer Royalty Deals

A lot of freelancers believe royalty deals are the “holy grail.” Especially in the world of freelance copywriting. That’s because royalty deals allow you to make recurring revenue — with unlimited upside — all for no extra work. But there’s also a dark side to royalty deals that almost no one talks about. And that’s what I’m going to reveal today…

A little over 2 years ago, I started focusing on signing clients to royalty deals.

At the time I had more-or-less maxed out my bandwidth. And when I looked at the copywriters who have the type of career, income, and freedom I want, I noticed that a big portion of their income came from royalties. Since royalties give you effectively unlimited upside. Which means in theory you can multiply your income without working more.

Sounds great, right?

There’s just one problem.

The Problem With Freelance Royalty Deals No One Ever Mentions

Scaling a funnel is hard. Especially in the last 8-10 months, when email performance has taken a nosedive and Meta has jacked up their ad rates.

So even though I’ve closed a bunch of royalty deals over the last 2 years, none of them have turned into meaningful cash flow yet.

The first one converts to the client’s own email list, so it at least pays me a little something. But it has not been able to scale on new customers.

For the second one, I have not yet been able to beat a long-time control. (Although I’m still trying.)

The third one got paused and probably won’t see the light of day.

And the fourth one showed signs of life at first, but it has fizzled out since then.

Even worse, I parted ways with a long-time retainer client in February. And they made up 40% of my income last year.

Which means not only did my plan to drive my growth with royalty deals fall short. I also lost a big portion of the monthly recurring revenue that allowed me to keep my income up while I took my chances on these royalty deals.

Not exactly how I drew it up. And hopefully it can serve as a cautionary tale if you decide to pursue your own royalty deals.

But I’m also happy to say the tides may finally be turning.

Finally, Some Good News

My most recent royalty project went live a few weeks ago. And the early results are exceptional.

One of our first affiliates said “this is the best offer we’ve run to our list since February.” And we have other affiliates who are getting a 3.5% conversion rate and $2.00 for every click they send us. Plus we did more than $5,000 yesterday alone, just with early test traffic.

So it looks like now — more than 2 years later — I finally have a royalty partnership that is poised to produce real cash flow for me.

The Harsh Reality

Part of me wants to say some type of cliche motivational quote. Like, “so just be consistent and you can achieve your goals.”

But that’s not true. If you apply consistent effort to the wrong strategy or business model, you will still fail.

Which is why I’m trying to balance my emotions here.

I am optimistic, excited, and relieved that it looks like this could be the breakthrough I have been working toward for more than 2 years.

But I am also disappointed with the fact that I was not able to sustain my previous income up to this point. Because it means I didn’t do a good enough job to diversify my revenue streams and mitigate my risk.

And it would have been much better if I now had this significant royalty opportunity on top of my previous monthly recurring revenue. Since that would give me even more leverage to decide where the best use of my time is going forward.

So that’s why, at least for now, I am continuing to pursue other clients. I do not want to bet all of my growth on one opportunity — no matter how promising it is.

And if the royalty partnership turns into a massive payday, I can always start to wind down other projects.

But if it doesn’t turn into a massive payday, then I still have the next batch of projects to contribute to my growth.

Make sense? Because that’s what I’ve got for you today.

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Thanks for the freelancing guide and the emails that you've been sending out — the 30-second referral method is so stupidly simple, that it's genius!

Connor Inch, Freelance Copywriter