Should You Start an Online Business?
For someone planning to start or expand a business, the web can be a gold mine. Every year, you hear about:
- Companies like Google and Facebook raking in billions
- Developers striking lucky and becoming millionaires with a single hit like Angry Birds
- Even kids hitting $150,000 in sales from selling bow ties
Tools and resources abound for the aspiring entrepreneur, and business startup costs are lower than ever. With nearly 4 billion people online, the opportunities seem endless.
But there’s no shortage of disappointments either. For every 10 businesses that launch, we’re told, almost 9 fold within five years. We hear about guys who quit their day jobs for online ventures that crash and burn. The grand, golden web can just as easily be a tar pit that swallows you whole.
Should you even take your chances?
When Doubt is a Good Thing
It’s okay to be apprehensive about your online business. There are tons of self-proclaimed gurus out there who’ll swear up and down that making money online is easy — that you have nothing to worry about, and you just need to follow their five, ten, or twelve-step program to start earning a million bucks a month. But you and I know it’s not that simple, and anyone who tells you otherwise is — yup, you guessed it — definitely out for your money.
Here’s a secret, though: those questions you have, the mix of terror and excitement that roils your gut when you think about taking a chance on the internet?
Those are good signs. They mean you’re ready to go from dreaming about a successful online business to rolling up your sleeves and finding a way to make that dream happen.
The truth is that questions follow any new project or venture, online or offline. Doubt is natural, but as long as you stay cool and ask yourself the right questions, that doubt can go from crippling obstacle to valuable guide.
Are you scared of ending up in the tar pit? Harness that anxiety, channel it into answering the following questions, and let those doubts bring you closer to striking gold.
Ask This: Am I filling a need? Do I have a market?
Not That: Will this work?
No business venture is ever guaranteed success, and “Will this work?” is a vague ask that doesn’t give you much to work with. Asking if there’s a demand and a market for your product or idea, on the other hand, gives you a more concrete benchmark for gauging whether or not your business can take off.
When Ben Kaplan started designing the meet-up app Wigo, he was trying to answer a need: arranging a night out with friends took too much time and effort. Five months after becoming publicly available, Wigo had over 100,000 active users and a $14 million valuation.
One look at Wigo’s userbase explains how: the app was in use in 73 schools and requested at over 1,200 college campuses. In other words, the 23-year-old Kaplan and his friends weren’t the only ones having a hard time making party plans, and Wigo solved the same problem for thousands of college students all over the country.
Kaplan only set out to solve a personal problem that others happened to share, but you can be more deliberate about targeting a common need. These are just some ways you can measure potential demand:
- Checking popular search terms or keywords to see what people are looking for
- Scanning threads on relevant forums or online communities to get an idea of your target customers’ preferences
- Conduct surveys to find out what customers expect of a product or website like yours
- Offering pre-orders or even putting your product on a crowdfunding platform like Kickstarter
Ask This: What’s the competition doing?
Not That: Will I even survive?
Internet behemoths like Amazon are well-known for dominating the market and devouring the competition, and chances are, there’s already a giant or two in your chosen niche. Do you even bother?
The answer, in most cases, is still yes. The web is broad enough, and mature enough, that no profitable market or niche is empty. You will always run into competitors. By taking the time to see what the competition is like, you can pinpoint their strengths and weaknesses, and it will be easier to see how you can set yourself apart.
Distinguish yourself, and you’re one step closer to a sustainable online business.
Ask This: What are my first steps?
Not That: What do I even do?
Looking too far ahead (“I can’t start without a detailed, ten-year business plan”) or too close to the ground (“We can’t work on anything else until we have a domain name”) can kill your business before it even starts.
To keep from being overwhelmed or losing sight of the big picture, jot down the essentials for getting your business up and running. That list can vary depending on the business, but here are some items you might include:
- Setting a reasonable but profitable price for your product
- Securing your supply chain (especially if working on a physical product)
- Estimating how long your capital will last and how you can augment that
- Establishing a solid marketing campaign
Ask This: How much am I willing to give?
Not That: What if I can’t do it?
Dictating your own hours, working from home, maybe even skipping the part where you change out of your pajamas—being the boss of your own online business can sound like the ultimate dream job. That picture skips over many crucial details in the everyday life of an online entrepreneur, though.
Here’s the deal: Building a profitable and sustainable business takes work. Escaping the rigid schedule of a 9 to 5 job may sound like heaven, but don’t forget that you’re trading it in for the double-edged sword of unbounded time. Sure, you can start your workday around lunchtime if you’re not an early bird. On the flip side, you can’t clock out at 5 and “leave it to IT” if you’re the sole owner and your website just crashed. Likewise, you’ll have to create your own schedule, and how you prioritize tasks or allocate your time will have a big impact on your business’ day-to-day performance.
All of this becomes more important when you’re starting out alone and with limited resources, which is often the case. To ensure that your business has a stable foundation, you’ll have to go above and beyond, especially in your first couple of years.
It’s easy, but often unhelpful, to wonder if you can even do it at all. Instead, dig deep and ask yourself: what are your boundaries, and how much can you give to make the business work?
Ask This: How long can I wait?
Not That: Where’s my money?
A successful online business doesn’t just take work; it needs time, too. Nobody is a smash hit on their first day. It takes time to put your name out there and generate, say, regular traffic and a social media presence. From there, it can take a bit more time before you get a steady earnings stream.
You’re looking at anywhere from one to three or more years until your business can chug comfortably along and support you fully. Many self-described online business gurus claim that you can get rich quick, but that’s rarely the case—at least, not if you want a truly sustainable business.
Keep in mind, too, that billion-dollar revenues are just one possible form of success. You don’t need a “visionary” app or website to make a living online. You might not launch the next Facebook, but you can definitely get healthy returns from building trust with customers, cultivating a following, and establishing yourself as a reliable provider of valued products, services, or content.
What’s It Going to Be?
It’s true: tech billionaires are, well, one in a million. You probably aren’t going to be one of them. For every Facebook, there are hundreds, if not thousands, of failed businesses on the internet.
In that landscape, it’s only natural to have doubts. Giving in to those doubts, however, is a surefire way to get nowhere. Instead, why not use them to boost your chances of succeeding?
Remember, there’s a wide spectrum between the Zuckerbergs of the world and the cautionary tales who flame out in their first month. Harnessing your doubts and turning them into productive questions can help you navigate that space. Your answers might not lead you to a billion-dollar gold mine, but they can steer you to a promising spot that can, with time and effort, blossom into a beautiful garden of your own.