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Starting An Online Business – All It’s Cracked Up to Be?

forwardWhen I look back at my struggles to start a successful online business, it’s incredible I stayed with it long enough to see profits.

Maybe I’m a late bloomer but I didn’t make any money in my first year.  By the second year, although I was seeing a little income, it didn’t begin to cover what I had spent to that point.

It wasn’t until my third year that I hit on my first profitable niche business.

So why did I stick with it?  And was it worth it?

To know that, you have to know a little of my background.  I worked as an employee before starting a traditional self-employed business.  My family members weren’t entrepreneurs.  I, however, got the bug early and invested in real estate and built single family homes on spec.

But why would I leave a lucrative home-building business (fyi, I still do a little investing when I find a super deal) …only to spend years, without pay, to try and start an online business?

On the face of it, it looks kinda dumb.

Well, to be perfectly honest, although I loved building houses the first few years, it was only a means to an end.  After the challenge wore off, I continued because it was profitable.  Then I married my husband.  He wanted to take over and I said “Sure Honey!  You want the headaches, go for it.”

And there’s the first clue.  Headaches.

But let’s go deeper.  I want to explore how online business stacks up against traditional business and even employment.  Give you a “birds eye view” from someone who’s done all three.

Obviously, these three income models have huge variations.  Owning a Dominos Pizza is different from selling Avon which is different from building houses.  And working as a waiter is different from upper management at Dell computers.  Yet, even with these diversities, there are still universal parallels.

Do you have untapped potential to make a greater impact and a higher income online? Take the quiz to find out!

Employment – Pros and Cons

The major benefit to employment is that you don’t have to worry about where your next paycheck will come from, or how much it will be.  Even if you’re salary plus commission, you still have an idea of what you’ll make.

You probably don’t take your work home.  Once you leave, you’re done.  You can go home and chill without worrying about the business because it’s simply not yours to worry about.

If your company goes under or you get laid off you might get severance pay or at the very least unemployment checks to tide you over.

The downside to employment is that… well, it’s a job.

You give up ownership of your time and personal flexibility because you have to show up when your boss tells you to.  And where.. and do what you’re told to do.  Children sick?  Or you want to attend an event during work hours?  It’s an ordeal figuring out if you should even ask your boss for the time off, and if you should take a sick day or what.

If you are an awesome employee you might get promoted (with increased pay)  but not necessarily..

Bottom line: You are working for someone else’s dream, not your own.

Traditional Business Ownership – Pros and Cons

Working for yourself certainly affords more independence than employment.

You can have free time while your employees work, but that’s only if you have trusted employees to hold the fort down while you’re gone, and have the money to pay them.

My husband and I considered a Subway Sandwich franchise at one point.  The number one deterrent for us was having to deal with employees.  You know that expression “It’s hard to find good help?”  There’s a reason for that expression.  And when your employees don’t show up, guess who is standing in their place.  That’s right. You.

More considerations:

  • Liability
  • Keeping customers happy
  • Possible order fulfillment
  • Fixed market pool – there are only so many customers in your local area
  • Then there’s the cost.  A traditional business or franchise can cost several hundred thousand dollars and even millions.  If you borrow the money, you’ll personally guarantee with your assets, so if your business goes down you could lose your home, investments, bank accounts, etc.

It often takes years to see a profit.

Not everyone has the personality for the unpredictability of traditional business.  Then that old paycheck starts to look pretty good.

On the plus side, it is your business.  You get to make decisions instead of ask permission.  You decide the direction of how your company grows.

You get to pick projects and clients you’re interested in.. to an extent.  That depends on how much in demand you are, if you need to take undesirable projects or clients.

Still, with traditional business ownership, you do have a degree of personal choice and self-satisfaction. You’re the boss.

Online Business – Pros and Cons

Ahhh, now we get to online business.  And yes!  It’s my personal favorite but I won’t sugarcoat it because the reality is that it’s not for everyone.

Why I love online business (and why so many people get excited about starting an online business):

Super cheap to startup and maintain.  We are talking hundreds of dollars; not hundreds of thousands so there’s low risk money wise.

You can start an online business in your spare time while holding down a job.  Then quit the job after you start making consistent income.

Work when you want; where you want.  As long as you have an Internet connection, you’re good to go.  So yeah, you really can work at the beach.  In fact, I just got back from Panama City Beach and my income continued just as though I was at my home office.. and I actually did very little work the ten days I was there.

No employees.  If you want help, outsource as needed.

If you make your income via digital or affiliate products, Google adsense, selling ad space, or anything other than something you have to personally fulfil, you have no fulfillment issues.

With affiliate products you don’t even have to worry about customer service.  If you have a diet site and sell Nutrisystem, the customer goes directly to Nutrisystem with questions or issues, not to you.

With digital products (like Write Like Freddy) you can multiply your success because you do the work once while reaping profits many times over as people continue to buy those products.

It’s fairly simple to have multiple businesses online so you can enjoy many interests.  For example, I have a blog that helps people start their online business, but I also have music sites, and a minimal-living house website.

Now the downside:

OK, here’s the truth of the matter.. not everyone can do this type of business.

If you have a hard time focusing, you’ll find yourself aimlessly surfing the Net instead of working.  Or worse, jumping from one idea to another, never giving anything a chance to develop.

Sometimes, because it is so inexpensive to start online, people don’t take it seriously.  You must put in time, work and effort.  Otherwise you’re wasting your time pretending to have a business.

Your business can grow at a snail’s pace if you won’t spend money to get the training you need, or products and tools that will help your business.  You don’t have to go into debt to invest in yourself, but come on!  Are you in business or is this a hobby?  Heck, sometimes people spend more on their hobbies, than they do on their biz.

There’s a lot of moving pieces and much to learn.  It’s easy to procrastinate if you’re not careful.

It can be lonely at times.  Creating a mastermind group helps.  As does attending events and networking.

An online business typically takes a while to see profit.  Yes, this is also true with traditional business but unfortunately with all the hype, business expectations are often unrealistically high with an Internet biz.  You have to be willing to work hard without tangible results at first if you expect to reap rewards later.

Like I said, I am partial to online business. ’ve been an employee plus I’ve owned a traditional business.

Nothing compares to the freedom and opportunity of owning an online business.  I’ve found the stress to be minimal in relation to traditional business.  It’s a level playing field with unlimited possibilities.. and a heckuva lot of fun.

So what about you…

Have you started your own online business?  If not, what’s holding you back?

If you do have a biz online, please share your #1 challenge and your #1 joy.

Untapped Potential Quiz

About Darlene Bauer

Darlene Bauer works online in the beautiful Texas Hill Country. She created BlogBoldly.com as a platform to help newcomers learn to build their own profitable online business.

18 thoughts on “Starting An Online Business – All It’s Cracked Up to Be?

  1. Awesome post Darlene! I’m in my first year of building my virtual coaching practice.

    My #1 Challenge: I would agree that it can get lonely at times plugging away in my home office, but I have found that being a part of mastermind and getting out to some in-person networking events really helpful.

    My #1 Joy: Seeing your hard work starting to pay off and the joy of helping a client move forward in her life.

  2. Hi Julie!

    Thanks for stopping by. 🙂

    “My #1 Joy: Seeing your hard work starting to pay off and the joy of helping a client move forward in her life. ”

    Yeah.. that’s definitely a big booster.

    darlene 🙂

  3. For many, online business often equates with social reclusiveness – they become internet hermits, ending up working at least twice as much as for a regular job. That is a killer downside for the regular – ‘social butterflies’ types of characters.

    Working and building an online business is extremely demanding of ones social & family life. At least in the beginning. Without strong family support is almost impossible to do it, unless you’re single…

    However, the perks once the business is up and running are WELL worth the sacrifice. I know from personal experience.

    Cheers,
    Steve ✉ Master eMailSmith ✉ Lorenzo
    Chief Editor # eMail Tips Daily Newsletter

    • Hey Steve!

      You said: “the perks once the business is up and running are WELL worth the sacrifice.”

      I totally agree.. and the thing is, EVERY business is a sacrifice.. for that matter, so it a job.. but as you mentioned the perks/rewards are well worth it.

      There’s no other business where you can work on your own terms like an online business.. and with the income potential and time freedom.

      ~darlene 🙂
      p.s. The reason I have a lady at the beach in my blog footer is because that’s one of my driving forces. To work anywhere.

  4. Darlene,

    Great post and thanks for it.

    It has clarified my thinking about my business enormously.

    I am 61 and am hoping that my efforts online will result in enough “passive income” to be a pension plan for me. As my outgo is minimal and I have a simple lifestyle (and am a single man) this might be possible. I surely hope so as it is very unlikely that any other pension plan will come my way.

  5. It is absolutely possible Dan.. Yes, create your own pension plan.

    Have you picked a fav social media platform to interact with audience and let them know about your music courses and membership site?

    ~darlene 🙂

  6. Great post!

    Some people may think that those who run an online business (or work from home doing (fill in the blank)) sit around all day and eat chocolates or goof off. This is a misconception.

    I work harder than ever. I’m up earlier and sometimes don’t wrap up until 9 p.m. and/or 10 p.m. Plus, there’s the temptation to check my social networks and/or email throughout the day. This is a challenge. But it’s not the number one challenge. My number one challenge is doing everything myself. This is why I’m speaking with a couple of web designers because I’m tired of ‘tweaking’ my website. I would like someone redesign it. Tweaking my website doesn’t cut it anymore.

    The joy is the flexibility. If I need to run an errand, I can. If I need to take one of my two cats to the vet, I can. If I want to take the day off, I can.

    My recommendation is to “moonlight” while you work full-time and/or part-time. Try running an online business on the side before you quit your day job. If anything, you’ll have extra income each month. And who knows. You may end up quitting your day job.

    • Hi Darlene,

      Thanks for the feedback!

      I like my web template, Modern Blogger, designed by Lindsey Reil. I purchased it from StudioPress. I’m hoping a web designer can revamp my website using the Modern Blogger template. Or I can find a template close to it.

  7. I thought it was interesting that you said you built spec houses. Did that with my ex-husband. Loved it. Honestly, I’d love to do it again…the biggest problem there is that the housing market will ALWAYS fluctuate, so you have to have capital, and I don’t.

    I was recently reading (in the “One Page Business Plan for Women”) that it takes at least three years to start seeing a profit from your business (as you point out). I was frustrated because I thought, “I need to make money NOW.” Then I realized that, in a sense, I’ve already been in business for over three years. I launched my homeschooling website in 2010, but so far it’s only broken even.

    However (big however here) I was not actually selling any of my own products or services through it. The only money has been as an Amazon affiliate (not much money either). I started the site, really, as a way to be a blessing to people with the thought that maybe, somewhere down the road, I could use it to make an income.

    Well, now’s the time! I really need to start making an income and, fortunately, I have the infrastructure I’ve built so I CAN start selling my own products and services.

    I’m also going to launch a life coaching business to help women like myself who are in mid-life and facing major transitions. But right now I’m focusing on the place where I already have the mechanisms in place to reach people.

    One last thing, when I do get some capital, one thing I want to do is flip undeveloped property. As much fun as it is to design and build a house, it is a lot easier to buy property, improve it a little, and turn it around to make a few thousand dollars. Just a thought! 🙂

    • Hello Anne!

      Well, we have a lot in common as I homeschooled my kids too.

      darlene 🙂
      p.s. I’m starting a new section on my blog called “Grand Blogger Showcase” to highlight bloggers making $1000+ per month as an inspiration to show how bloggers are making $ (cuz there’s lots of pp who don’t realize it takes time.)

  8. Really loved reading your post Darlene. It relates with my personal journey of starting a Web Services and Online Business while being full time employed in the United Kingdom. I get feelings to break out and go full time with my business but still keeping it to make sure the finances are rolling in well and I secure a fair amount to clients for SEO and web services.

    As you have questioned, the top issue is always getting more clients and gigs to design websites. You can find my personal blog by Googling “FERNANDO BIZ” which attracts closer to 500 unique visitors each day.

    Thanks for sharing your experience and amazing ideas about starting an online business.

  9. I am fairly new to internet marketing and my biggest challenge is getting traffic. I do make some sales from the few visitors who stop by but nothing to speak of so to speak.

    I recently discoverer that I like making videos, and intend to do a course as soon as I earn enough to do a course.

    • Michal..

      We always can find time for what’s important to us.

      If this is truly your joyful dream.. schedule in a few hours a week to build your biz. Guard that time like a hawk, and begin. Today. Not tomorrow.

      darlene 🙂

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