3 Examples of Online Businesses you can Start Today and Scale to 6-Figures

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It is time to get our hands dirty!

So far on this blog, we have discussed many things about making money and building wealth.

At first, we began with an overview of what wealth is and what it takes to make some serious money.

Later on, we discussed about the proper mindset you must have in order to increase your chances to become rich.

Then, we talked about how to escape the rat race and why entrepreneurship is essentially the best approach we have to build wealth fast.

Of course, entrepreneurship is a huge topic and there are several concepts to start and experiment with. That is why we focused on evaluating a business idea and starting the right kind of business.

Finally, we aimed our attention to online ventures which offer significant advantages, especially for rookie entrepreneurs.

Now, it is time to get more technical and review some internet based business concepts that can be started today with minimum to low capital.

All of those have the intrinsic ability to scale, and the potential to make you a millionaire in a short time if you stay the course.

I have been personally involved, in one way or another, with all of them and I will present below my thoughts and insights for each one of them.

Note: Before we get started, please read all the articles linked in the text above, so that you have a good grasp of what we are going to talk about.

Alright, let’s do this!

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First, here are some requirements that all the ventures fulfill:

  • Zero to low capital demand
  • No strong business experience needed
  • Low to medium complexity
  • Potential to scale to 6-figure annual revenue

Business #1: Online Media

This is just a fancy name for saying that you are the owner of an online web property. You might have heard similar terms for this, such as blogging or website building.

Of course, media could also include video or audio based assets, but for this analysis we will focus on the text format only.

At its core, this business model involves building an online property, attracting or generating traffic to it and then monetizing it.

This is the type of business that I have the most experience with, since I have owned, co-owned, operated and monetized several web properties over the past few years (and still do), ranging from 4 to 6 figures in annual revenue.

online-business-examples_02_website

Here is how it looks in bullet points:

  • Build a valuable online asset
  • Generate traffic towards that asset
  • Monetize the generated audience

The first step here is to build an online asset that provides value to a specific niche of the marketplace. This will consist of setting up a website, providing content in the form of articles or tutorials, and perhaps offering auxiliary services like an Insider’s Newsletter (hey, hop on to mine here).

For example, if you are a dog enthusiast, you could create a website about dogs and puppies, write well-researched articles on the various dog breeds, giving away free guides on dog training and ultimately building a vibrant community of dog owners.

At this point, I can’t stress enough the fact that the property you are building should be of high quality and provide mass amounts of value. During the recent years there has been an explosion in the number of websites, so you need to offer high quality in order to stand out from the crowd.

After your website is up, and while you keep adding content and new features, the next step is to attract or generate traffic. This will enable you to slowly build an audience of people that like and trust you or your brand.

Here is a list with the different types of traffic:

  • Organic
  • Direct
  • Social
  • Referral
  • Email
  • Paid

Depending on the web property you are building, some of those will make more sense.

In the dog website example, you should expect the majority of your traffic to come from search engines (organic) and social media (e.g. Facebook, Pinterest etc.).

After you have established a decent amount of traffic, it is time to get something back in return for your efforts. That is when you experiment with monetizing your online asset.

Thankfully, monetization of web properties is pretty straightforward and the available options are quite known and established.

Here are some general strategies for web monetization:

  • Display Advertising
  • Affiliate Marketing
  • Lead Generation
  • Online store
  • Subscriptions
  • Sponsored Content

Again, depending on your niche and type of website, some of those will make more sense. The great thing is that you usually be in a position to implement almost all of them.

Assuming that you remain involved in this industry for quite a while, you might accumulate a number of web properties. After you scale things up, you can start thinking about the greater picture, and that is the creation of an online media company, with all the brands you have created under its portfolio.

Now, let’s examine this type of venture using the NECST framework.

Need: This is a bit tricky. As I mentioned, the world is currently abundant with websites and content. That is the reason why you should strive to find a specific niche that is currently underserved and at the same time provide high quality content so that you can stand out.

Entry: Unfortunately, this is where this business model is losing points. It is fairly easy for anyone to build his own blog or website, and that is exactly what has happened over the recent years. Since there is a lot of noise in the marketplace, you need to have a Unique Value Proposition (UVP) in order to be able to attract a loyal following.

Control: In general, you are mostly in control of your own business. There might be a dependency on search engines like Google for incoming traffic, but this can be mitigated by diversifying to other channels too and by building a mailing list you own.

Scale: Solid points here. In essence, with this approach the world is your playground. Depending on the niche and the Total Addressable Market, this model can scale extremely well. Since the overheads of running a website are quite low, scale is your greatest ally in achieving profitability.

Time: Solid points here too. A website is an asset that can live and operate without your involvement. It can serve your audience 24/7, without your presence. Your time can be totally detached from the underlying business.

Now, let’s see how this business model fares in terms of initial capital required and overall complexity of implementation.

Capital: Building an online property requires a very small amount of money. You can bootstrap a project with only $500 and perhaps even less than that. When it comes to starting a business, there is hardly any other approach that is most cost effective.

Complexity: Another big winner for this model, since it is one of the least complex ways to launch a business and start generating revenue. It involves only a few moving parts and mainly depends on your own efforts. Some technical elements might be more tricky, but there is an abundance of free material online that can guide you through your early steps.

Overall, building web properties is one of the most straightforward and “newbie friendly” ways to start making money on the internet. It might take a while until you build a brand and an audience, but after this has been achieved, it can be a potent source of income.

Business #2: Digital Publishing

This business model involves publishing and selling digital books under your own pen name(s).

Let’s discuss the finer details of this sentence.

First of all, we will only deal with digital books here. Digital books have surpassed traditional books during the recent years, and this is a massive trend that is irreversible. This is where the world is heading to.

online-business-examples_03_ebook

Second, notice that I am not saying “writing” digital books, but rather “publishing” them. You should think yourself as a small version of a publishing house that has a stable of writers under its wings and is responsible for publishing and promoting their books.

Why? Well, one reason is that you might not be proficient in writing and that skill might take years to develop. But the main reason is because you, as an individual, do not scale.

Remember that the mindset behind all these ventures is that they will be able to scale to a massive magnitude. Something like that requires tremendous output of published books, something that an individual can’t realistically produce on his own.

Here is how the model looks in bullet points:

  • Choose a specific niche to get involved with
  • Have your ebooks ghostwritten by freelance writers
  • Publish a polished, high quality ebook
  • Market and promote the ebook
  • Gather royalties from the sales

As before, the first step is to find a niche that you are interested in and, at the same time, is not saturated. There is the flexibility to choose either fiction or non-fiction topics.

After you complete your market research and have decided on your niche, you hire one or more ghostwriters that will write the ebooks for you based on the guidelines and directions that you will provide them.

After the necessary back and forth with the writer, and after you receive the final draft, you proceed with the necessary checks (e.g. proofreading, editing etc.) and now you have the content of your ebook.

The next step is to bundle it in a well presented format. This involves getting a professionally designed cover that will attract the buyer’s eye. Again, this is a job that will be outsourced since you probably do not have the necessary design skills (if you indeed are a designer, feel free to do this step yourself to save some money).

You proceed by publishing your ebook to online bookstores, the most prominent being Amazon. Note that the end result should be flawless. Again, we aim for high quality here, not valueless garbage.

Moving on, there comes perhaps the most important ingredient of success for this business model: marketing. You go on and promote your ebooks ruthlessly by building your author’s online personal brand, collaborating with other writers and buy targeted paid traffic.

The final step is to enjoy the royalties from your book sales. Note that you do not directly sell the digital books, but rather you grant licence to the large bookstores to do that for you, and they pay you back royalties for your sales.

The big player here, as I mentioned, is Amazon. The online giant wants to dominate the online publishing landscape, thus provides several incentives to consumers to use their reading device (Kindle) and then up-selling them on the ebooks. This is the mega-trend that we are leveraging here.

Now, let’s examine this type of venture using the NECST framework.

Need: Truth is that the world is abundant with ebooks. For this reason, you need to find a niche that has sufficient demand and is not saturated. Look, people will always read books and they are in need of good entertainment. Your goal is to provide it to them.

Entry: One of the largest sticky points of the model. It is ridiculously easy for an individual to go online and publish a book in whatever topic they like. Thus, the online bookstores have been flooded lately by people who publish crappy books in pursuit of a quick profit. Eventually they will be purged out, but until then they cause noise in the marketplace. As I have mentioned, quality and consistency is what will separate you from them.

Control: This is where this model loses big time. In short, you are at the mercy of the online bookstores like Amazon. If they decide to change the rules, there is not much you can do other than adapt (if possible). This is the largest disadvantage of this model, and the price you pay for being able to tap into the vast audience that a marketplace like Amazon offers.

Scale: By abolishing control, you win massive scalability. Amazon and the other bookstores have hundreds of millions of customers, and you can have access to that enormous pool of consumers by licensing your books to them. People have managed to scale book sales to the tune of 6 figures per year with Amazon.

Time: Solid points here too. Your ebooks are mini-assets that work independently of your time. Sales come from all over the world, and during all day. Your time is protected and not bound to the underlying business.

Now, let’s see how this business model fares in terms of initial capital required and overall complexity of implementation.

Capital: As I said, you can get started with digital publishing with literally zero capital. Of course this won’t get you very far, and if you are serious about the project you should expect to invest $1,000-3,000 to get the ball rolling and until you make the venture to be cashflow positive and sustainable on its own.

Complexity: This is the least complex business model. There are a few things that you need to take care of (e.g. communicating with ghostwriters, formatting the ebooks etc.), but all in all it is very straightforward. If you wish to get to the next level, you will need to delve into a bit of online marketing, but you can get started very, very easily.

Overall, digital publishing is probably the best way for someone with zero experience to hop onto the online world and start generating a bit of revenue. In order to scale things up, you will definitely need to start honing your marketing and business skills, but as a beginner you can get the ball rolling very quickly.

Business #3: e-commerce (Fulfilled by 3rd Party)

This is the traditional commerce of goods, revised for the new age. The business model involves selling physical items and goods under your own brand(s), where the actual fulfillment is performed by a 3rd party entity.

OK, let’s see what this actual means in simple terms. In essence, you create an online brand in a specific niche and sell related products via 3rd party online retail stores which take care of the actual delivery of the product. The big player here is again Amazon with their FBA (Fulfilled by Amazon) program.

Note that you are not actively involved with the storage or distribution of the products. You just have the general overview of the process and mainly focus on building a solid brand and marketing your products to your fan base.

online-business-examples_04_ecommerce

Here is how the model looks in bullet points:

  • Choose a specific niche to get involved with
  • Research products that are relevant to that niche
  • Source these items for manufacturers (mainly from China)
  • Forward the products to Amazon’s warehouses
  • Manage the selling of the products under your brand

As always, the first step is to find a specific niche to get involved in. The niche should be in a low-competition industry and not overly saturated. On a second level, you need to decide on specific products within that niche. Procuring physical items can be a laborious process, so you need to take extra care here.

The next step is to research online for manufacturers and/or wholesalers that are in position to provide you with that item. After you communicate with them, you white-label the products so that they are sold under your brand.

You then arrange the specific items to be sent from the manufacturer’s facilities to Amazon’s warehouses. Amazon then takes care of listing the items on their website, promoting them to their customers and, if there is a sale, sending the product to the customer. On top of that, they also take care of the customer support. Awesome!

What you have to do is orchestrate the whole process and build the online brand under which those products will be eventually sold.

For example, if you decide to get into the pet industry, you could create a website about cats and kittens, build the relevant brand and then start selling white-labeled products to the audience you have accumulated.

Now, let’s examine this type of venture using the NECST framework.

Need: In the modern world, there are thousands upon thousands of products that people need or want. Your job is to find products that have decent demand and not that strong competition.

Entry: The entry point here is the higher from all the models we examine in this article. The reasons are that a non-trivial amount of initial money is required, and that the process of sourcing and selling physical items can be quite complicated.

Control: Again, as with Kindle Publishing, since you are heavily depending on Amazon, you relinquish a big part of the control you have over your business. Of course, you can mitigate the risk by always playing by the rules, and by focusing on building your own brand (e.g. via your website, mailing list etc.)

Scale: This is the upside you enjoy by existing in Amazon’s ecosystem. In two words: insane scale. Amazon is huge and you can have access to their massive audience by listing your products on their website. This provides immense opportunity for monetization. It is not rare for FBA based businesses to reach 6-figures in annual revenue and sell for 7-figures.

Time: This business model is a bit more laborious than the other two, but after you get all your systems in place, you can remove yourself from the equation and have your time detached from the business. It’s all about proper systematization.

Now, let’s examine the capital requirements and complexity of this business model.

Capital: The e-commerce model can be quite capital intensive. You need to make orders for physical items, so you are going to need some upfront capital for that. Budget in for $3,000-5,000 in order to bootstrap the business and take it to a self-sustainable phase.

Complexity: This is the most complex business model from the three. There are numerous moving parts to keep your eye on, from manufacturers, to designers and freight forwarders. Unless you have a bit of experience under your belt, it is perhaps wise to get started with one of the other two models, online media properties or digital publishing.

Overall, e-commerce with Amazon FBA can be a potent income source. It requires a bit of business savviness, but if you crack the model, you have the potential to scale this to 6-figures in annual sales perhaps within the first 18-24 months.

Conclusion

In  this article we discussed 3 business ventures that require low capital but have the potential to scale to some serious revenue provided that you are committed to the journey and you pour all your “sweat equity” to your business.

All 3 ventures are internet based, because an online business can be much more nimble and flexible, and let’s face it, this is where the world is trending to.

Now, this was just a brief overview to get you a high level overview and not a comprehensive analysis. Stay tuned for the next Wealth Triumph articles where we will delve into more detail for each one of them.

Every week day I am dropping short-form value-bombs on LinkedIn. Connect with me now!

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