For those searching for methods to fill income gaps and build a sustainable financial future, starting a business on the internet is an increasingly viable option. Armed with a well-conceived plan and an entrepreneurial spirit, just about anyone can launch an online venture. And while there are times a leap of faith is called for on the path to success, operating intelligently and efficiently can help reduce risks and potential implications associated with establishing a new business.
Whether you or your clients have a promising concept, product or skill to build an online business around, consider these seven economical strategies for tilting the odds of success:
Maintain a Source of Income
When Money Crashers publisher Andrew Schrage went into business for himself by purchasing a small personal finance blog, he put his heart and soul into making it as profitable as possible. And, just to make sure he remained financially stable, he held on to his day job.
Following the dream of owning a business doesn't have to be the dramatic, all-or-nothing proposition it is so often portrayed to be. The beauty of starting an online business is that it can be done without an investment in a physical location, and with total control over the hours and resources an individual decides to allocate. It takes patience to build a thriving online presence, whether attracting an audience to a blog or gaining exposure for new products, so even a part-time source of income can be indispensable for keeping an online business financially afloat until the revenues start rolling in.
Consider the Strength in Numbers
Another wise thing Schrage did when he started Money Crashers was to form a business partnership with Gyutae Park, a like-minded individual who shared his vision of growing a thriving online community focused on financially responsible living. Having a business partner or multiple partners while building an online company not only can provide the moral support and inspiration to see a venture to profitability, but also to help shoulder the necessary investment of time and resources. When choosing the right collaborator, it's important to identify an individual who shares and understands the vision, possesses a complementary skill set, and is equally driven and accountable.
Utilize Low-Cost Tech Solutions
For nearly every big-ticket tech item available on the internet - whether it's a designer website, project management platform or business accounting software suite - there's a solution to be had for either free or at a nominal monthly expense. Before pulling the trigger on any sizable monetary outlay, due diligence should be performed to identify the availability of a suitable low-cost alternative. In the space of a day, with zero financial investment, it's possible to acquire a fully functional website with free hosting through SquareSpace, consolidate phone lines with a business number from Google Voice (including everything from conferencing capabilities to free domestic long-distance) and start managing invoicing and payments with Freshbooks cloud accounting.
Capitalize on Free Marketing Opportunities
Advertising online has quickly become big business, with billions of dollars spent annually in the US alone, but it's also ripe with free and low-cost methods of promotion. Beyond employing basic SEO best practices to start driving traffic directly to a website, a social media marketing strategy is a powerful tool for connecting to an audience of qualified leads and strengthening client and customer relationships. From setting up Google+ and LinkedIn business profiles, to building an active Facebook and Twitter following, social media is a cost-effective, sustainable and scalable vehicle for driving an online business.
Seek Investment and Funding
If additional capital is necessary to get the wheels turning on a new venture - and the likelihood or inclination to take out a loan is low at best - there are many places to turn both locally and online to procure the support needed. While countless personal businesses have been helped along with investments from friends, family and members of the community, there also exist public programs for grants and financing specifically tabbed for small business development. The Loans and Grants Search Tool on the U.S. Small Business Administration website is a helpful way to identify programs available for specific businesses, while soliciting financial support on a website such as GoFundMe has provided the means behind a number of inspiring startup success stories.
Consider Relocation
When real opportunity calls, it's necessary to answer in a clear and convincing voice, demonstrating the drive and desire to do whatever it takes to get over the hump. An online startup can be run out of a home or remote location - but the less spent on rent, a mortgage or living expenses, the more resources available to put toward building the business. Taking a page out of the playbook of larger corporations that strategically change physical locations in order to reduce overhead and maximize profitability, relocating to a less expensive neighborhood or region can supply the extra time and flexibility necessary to allow a prosperous plan to develop.
Operate Economically
While some startup costs are ultimately unavoidable, taking a comprehensive approach to responsible spending helps to keep expenses to a minimum. From opting to purchase used or refurbished essentials such as computers and mobile devices, to utilizing a community-based online forum such as Freecycle to score free items such as business furniture and supplies, a lean online business can break ground without breaking the bank. Bartering services, taking on interns or offering a stake in the company as compensation can help minimize payroll, while a free online job posting board such as oDesk is an effective source for helping small businesses connect with freelance employees willing to work on their terms.
Final Thoughts
For individuals hunting for new financial opportunities, operating an online business is a realistic means of independent job creation and increased personal incoming. By taking a lean approach to building an Internet business, an entrepreneur with limited capital can reduce financial risks while making a run at the American Dream.
What other tips can you suggest to those who wish to launch a small business with limited funds?
Brian Spero is a business owner and contributing team member of the personal finance resource, Money Crashers.