How to keep your side hustle a secret
Nothing seems to hotter right now than entrepreneurship. Specifically…entrepreneurship for people with jobs. I mean why work for somebody else from 40 hours a week for some jabroni when you could work for yourself for 100+ hours a week!? We’re talking about having a side hustle here. Maybe I’ve been listening to too much GaryVee, but it seems a lot of the young-folks these days want to start a business in their spare time.
So what if you have this side hustle, but you don’t want your current boss to find out about it? That’s a questions we get all the time (three times counts as “all the time” right?).
There are some steps that you can take to keep your budding new business a secret. I’m going to skip the most obvious step of not telling your boss is posting all about it on social media. I’m talking about how to anonymously own your business.
Important thing to note pre-side hustle
If you are employed as a software developer, and your side hustle is developing software similar to that of your employer, you’ll probably be sad to learn that your employer likely owns the rights to whatever you develop on the side. Many employment contracts read that any intellectual property you develop while you are an employee will belong to the employer. Yes, even if you work on something after hours. Be sure to check what rights you have before you start grinding from 7pm-3am every day.
Set up an anonymous entity
The two main ways to anonymously own a business are to have a trust own the business or set up an anonymous LLC in a state that does not disclose the names of the owners. If you use a privacy trust to form or own a business, you’re going to have to have a third person helping you out. That person will be the “trustee” and trustee’s name will go down on business ownership records (if you form a business in a state that publishes the owners’ names). That’s usually a pain for most people because you either have to pay somebody to serve in that role or cajole a friend/family member to do it.
In my mind it’s a lot less hassle to just form an LLC in Wyoming and your name will not be known to the state (and therefore not published online). Another great state for private LLCs is New Mexico, however, state lawmakers there are starting to push legislation to require disclosure of ownership.
Trust or LLC, there are some easy solutions for keeping your side hustle on the DL. It just takes a little planning ahead of launching your side business.
Colin Ley is a Seattle asset protection attorney. He is also the co-founder of LayRoots along with his wife, Shreya Ley.