Like everyone has said, a side project is one that scratches an itch you have. Basically, what day-2-day functionality needs improving the most. And, do you have the capacity to improve it (or think you can)? From there, the side project is born.

My current side project stemmed from another side project actually.

I wanted to make (basically) an art version of Reddit, but much more robust. It would have cool apps that would make the artist's life much better. I had (and still do) a ton of idea on how to do that, so I started building. I've made many versions, but it still wasn't quite "right".

I have release it, but there was no traction (no should there be, its a crudely built website).

While building the latest version, the project became more and more robust. I had some cool components in it, one in particular and came to a fork in the road. Should I continue on with the Big project, or spin-off a component?

I chose the spin-off and thus my project Vidcap was born. I'm about a week away from releasing it after about a month of develoment. The goal would be to help people annotate their favorite videos to get more information out of it.

Will I ever go back to the other idea, artjutsu? Of course. Its still a passion of mine and something that I want to finish, but I think that Vidcap could be something that could help me achieve that goal (and help others) much more quickly.

If you'd like to take a look (before I post it on Show HN) be my guest - http://artjustu.com/vidcap/index.html?q=4