If you’ve read books like The Four Hour Work Week, the $100 Startup, or Rich Dad Poor Dad, you may know a little something about passive income. It does sound nice to be able to make money without your direct involvement or perhaps even during your sleep.

Unlike active income, you don’t have to trade hours for money when you make passive income. This makes it very scalable and a great asset to have.

Starting a passive business is something most entrepreneurs dream about. Running a business requires a ton of time and effort. While it does take time to build even a semi-passive business, it’s possible and others have done it. It all depends on your business idea and strategy. Here are 5 legitimate passive business ideas to consider.

Invest in Crowdfunded Real Estate

The real estate market is perfect for passive income. However, it costs money to purchase property, and you may not want to deal with tenants one-on-one.

With crowdfunded real estate, you can partner with a team of investors and put all your money into one big pot so you can own a piece of the property. Sites like Fundrise allow you to start investing with as little as $500. Their real estate investment projects generally offer an 8.8% – 12.4% annual return according to their website.

Realty Mogul is another crowdfunded investing site and their minimum investment is $1,000.

Buy a Profitable Website

Starting a blog or website can be a great way to build a passive income business. Only it takes A LOT of time and effort upfront to start generating an income, let alone a passive one.

Instead, you might want to consider buying a website that is already profitable and making money. This will require an investment from you upfront but you will have a solid foundation to work with.

You’ll be making a passive income with the site right off the bat and you can work on growing it over time. Flippa is a great resource to find profitable websites that are for sale.

Create an Online Course

You don’t have to be a teacher or have a fancy degree to create and sell a course. If you have some expertise or valuable experience to offer, you can create a digital course to sell for extra money.

With sites like Teachable and Udemy, you can easily create, host, and sell your course online. There will be a good amount of work to complete before selling online courses becomes passive income.

You’ll need to identify your audience, narrow down a topic, outline and create the material, then decide how you’re going to market and sell it. Still, I know plenty of business owners who make a six-figure income each year selling courses.

Once they create the material and set up all the marketing funnels, the income becomes quite passive and only requires some ongoing maintenance.

Shipping E-commerce Business

A common passive business idea is to sell items online with a digital store. You can create a drop shipping business and sell items for a living. To do this, you’ll need to set up an e-commerce store and allow customers to purchase products from the manufacturers on your site.

When orders are placed, the manufacturer will need to ship the product to the customer. That way, you won’t have to deal with handling the packaging and shipping process all on your own.

You’ll be responsible for legalizing the business, choosing the products, and coming up with a brand if you wish. Again, this business will require a lot of upfront work to get the website up and running and select the products. You may even want to hire someone to help with marketing and building an email newsletter to make more of the business passive.

Buy a Laundromat

I always thought about how cool it would be to buy a parking lot in a major city as a passive income business idea. Parking in the city can add up so if someone were to open a lot that charged less than the competition, they’d make a ton of passive income.

Then, I realized buying a parking low in the city can cost millions of dollars. So the next best idea would be to buy or start a laundromat.

Laundromats are nice from an owner’s perspective because customers do basically everything themselves. You may need a few staff people to do maintenance on the machines and restock supplies, but you don’t really need to actively work on your end to make money.

Start-up costs can still be high if you’re looking to build a business from scratch. This is why it’d be best to buy an existing business.

Have you ever thought about starting a business to generate passive income? Which one of these passive business ideas do you like best?