Historians will look back at this period of time as an information revolution in the same way we look back at the industrial revolution. In the space of 30 years we have gone from basic communications to having a small portable device connected to a network capable of delivering answers to any question, maps, shopping and dumb selfies of our friends.
There have been more millionaires created from web businesses in the last 20 years than in every other industry throughout time.
In this article I am going to discuss ways in which you can profit from the digital revolution. This isn’t some guru course or build up to a make money from home seminar, just some common sense advice for aspiring entrepreneurs.
Add Value
If you can improve peoples lives on a grand scale then you will have 90% of a profitable business. The scale of the internet means we can reach people across the globe with few boundaries. Does what you are working on right now really add value to peoples lives?
Is there a product/service/website you could offer which:
- Makes the users lives easier
- Solves an existing problem
- Improves upon a current solution/process
- Make them feel better about themselves (self-improvement)
- Teaches the user a desirable skill
- Ticks off one of the Life8 basic requirement:
1) Survival, enjoyment of life, life extension.
2) Enjoyment of food and beverages.
3) Freedom from fear, pain, and danger.
4) Sexual companionship.
5) Comfortable living conditions.
6) To be superior, winning, keeping up with the Jones.
7) Care and protection of loved ones.
8) Social approval.
Your product could be an app, a website, a video series, a blog or a whole host of other options but does it add value to the user.
Ideas
Ad Revenue Based Models
Blogs, forums, content sites, video, journal, how to’s, community sites, social networks, search engines, apps
Subscription Based Models
Software, advice, coaching, health, social/dating, apps
Online/Offline Models
Ecommerce, drop shipping, directories, lead generation
Marketing Models
Affiliate marketing, mailers, advertising agency, traffic network, mlm network marketing
Marketplace Models
Connecting buyers and sellers, eBay, stock trading
Other Models
Kindle author, Fiverr services, gambling
Scale
The reason that so many millionaires have come out of web based businesses is that the online world is so easy to reach. You can produce content today and within 5 minutes it could be emailed out across the globe or put on banner ads and run across every continent. If your on this blog because you have a background in affiliate marketing then you are at an advantage because you are used to scalling campaigns across different countries and reaching audiences in far away places.
Some people look at money as a scarce resource. Really it is in abundance. 3,000,000,000,000 USD is traded in the foreign exchange markets every single day! £810,000,000 GBP was spent by British consumers alone this black friday. Money is in abundance, if you can create something of real value then it will attract money like moths to a bulb.
Passive Income
For many people who work in online industries the holy grail is to find a large source of passive income. Set it up and go sit on a beach while the dollars build up in our bank accounts. The make money in your sleep dream is actually very achievable online. While nothing is 100% set and forget you will find many more businesses online that can run themselves or be run by outsourcers to free up your own time. This not only gives you freedom to sit on a beach but it allows entrepreneurial minds to focus on the next thing without micromanaging an already successful business.
The passivity of any project should be seriously considered before you undertake it. There is no point in quitting your day job to work online and then finding you are stuck to a desk for more hours than you were in your previous job.
If something is taking up a lot of your time, can you outsource it? Can you break it into parts and then source those out to different virtual assistants? Could you partner with someone locally to run your business or sell the company allowing you to focus being the visionary for the next big thing.
Skills
While I’m sure plenty of people do make a living online without any computer literacy there are somethings that would make the whole process a lot easier. Education should be an ongoing investment in yourself. You don’t have to sign up to night school or invest in a get rich quick scheme. There is information available for whatever field you are interested just google it and start reading.
Basic Coding Knowledge
You can learn basic html and make your first website from scratch in less than an hour. All you need is Notepad++ and a “hello world html tutorial” If you can’t code there really is no excuse not to learn the basics.
If you have mastered HTML then the next steps is to learn about the positioning and styling of web pages using CSS. Once you’ve learnt that move on to basic programming languages like Javascript and PHP, databases such as MySQL, API’s such as Facebook integration.
There’s a never ending list of technical abilities which will help you develop your online business better.
Online Marketing
If you are on this blog then you are probably already pretty experienced in the field of online marketing. This gives you a huge advantage over your competition. Do you know how to setup Adwords and Facebook campaigns, place a retargeting pixel, mv test a landing page? Most of these things would sound alien to anyone else who was starting out trying to make a living online.
“Build it and they will come” They probably wont. You are going to need some cash to get the ball rolling with paid traffic or some skills to get the SEO and social aspects right to entice organic traffic.
Server Management
So this is a tough one, if you are over 30 and you don’t know what a server is then you could probably make better use of your time. If you are young and eager to learn get an old laptop or a VM and install Linux on it. Learn the commands, try installing a driver (always fun), look at setting up a web server, an email server. Its another one of those things that when it goes wrong you aren’t reliant on other people to fix it. And Linux is very good at being open and simply by using it you will have a better understanding of how computers and operating systems work.
Communication
As an affiliate I’ve been as guilty as anyone for not caring enough about my clients. For the majority of the traffic I run I am not interested in their problems or complaints. Communicating effectively will help you in the long run though, whether that be with our customers, your website traffic, your reps or your accountant. Communication is what the world wide web was built upon and whatever you do online you will need to communicate your message well.
Financing
The cost of starting a web business is usually minimal. Anyone can register a domain name and setup some wordpress hosting for less than £100gbp/year. Compared to almost every other industry this presents a phenomenally low barrier to entry. In the UK you can set-up a ltd company as well at very little cost.
If you are worried about risking a £100 you really aren’t thinking big enough. Admittedly most projects fail miserably and you probably wont see that money again but we’ll talk about that later.
Planning
Just because your business is online doesn’t mean you should treat it as a hobby. For every project I undertake which will take me more than a month to complete I will do a proper business plan. This isn’t for anyone else, I’m not trying to raise funding or show off my idea. It simply acts as a way of collating all your ideas in one place and putting some stress tests against them.
A simple profit and loss projection is invaluable at the planning stage of an online business. How many customers do you expect in week 8? What will the average revenue be? Will advertising costs be low enough to profit?
If you don’t know these answers then lay them out in a spreadsheet. I’ve included an example below of a spreadsheet done in Google docs which looks at the profit and loss projection for a subscriber based business.
Before you start building your project you should run some traffic, or at least do some kind of market research to find out if there actually is the demand you expect. Can you set-up a MVP (Minimum viable product) or a lead capture page and find out some basics such as conversion rates. This will give you a much more accurate picture when you are forecasting.
More than anything a business plan acts as a central store for ideas. I have not found a better way to collect up all my enthusiastic ramblings than getting them all jotted in a business plan. If you have a new idea for a feature at 3am you can type in a heading and go back to bed and it’ll be there in the morning to explore. If you think of a new potential advertising source, put it in.
I’m also lucky enough to have two people who will read these things and tell me how crazy I am being with the project. I heard a saying that if you tell ten people the idea you are working on and no one says it’s impossible then you aren’t setting your sights high enough. I prefer to listen to my peers as it’s easy to get caught up in a whirlwind of enthusiasm and miss obvious factors that could make a project infeasible.
Failure
When you start any business you need to accept that failure is a possible outcome. It’s like getting married, everyone thinks they’re going to be together forever, about 25% actually are. I think the odds for internet startups are probably even less.
The best entrepreneurs embrace failure. I personally have failed tens if not hundreds of times. In fact I’d say 80% of the projects I launch don’t work out the way I’d hoped, I simply pivot or move on. The key is you only need one project to really take off and you’ll never have to work again if you don’t want to.
If I was advising someone starting out I would say look at your first few projects as a learning curve. If you start one business a year and the first three fail you haven’t wasted your time and money you will have learnt in that process more than any business college could teach you. Successful online developers build/fail/build/fail/build/succeed/build/fail/build/fail/build/succeed/build… And so on.
You shouldn’t expect to make a million pounds on the first website/app/campaign you build. It’s like playing snooker and expecting to make a 147 break the first time you pick up a cue.
Getting Started
The first step is always the hardest. Committing to a project, quitting your day job or registering that domain. You will never get anywhere if you don’t start working on it. Ideas are two a penny it is execution that really sets apart great businesses from failures.
If you are considering starting an online business I could not recommend it enough. There is so much opportunity on the web that if you work hard enough for long enough you will achieve your ambitions.
