Congratulations on deciding to start your own online business! As you embark on your new journey into entrepreneurship by running an online business, you may have a number of questions! I’ve done quite a bit of reading on this subject in pursuit of my own dream of starting a business, and thought it may be of value to share what I’ve found with the rest of you. While every person’s entrepreneurial situation will be unique, my hope is that this post will guide you through the steps to start an online business using the wealth of information available on the Internet. Where possible, I will show you steps to start an online business nearly free of cost!
Step 1: Know Thyself
Just as the Oracle told Neo in “The Matrix,” the first part of starting your own business is to do some soul searching. Here are a few questions that you may want to answer on paper to help keep your focus:
- What is the true reason you want to start your Internet-based technology business? Do you have an incredible idea? Is it to have better control of your work/life balance?
- Who will your customers be? How will your online business make money?
- What is your primary goal with the technology business?
- Will starting a technology business truly move you towards your goal?
- How much time are you willing to invest in starting your technology business?
It’s important to know what you want (your goals) and how you’ll get there (your plan). To start, you can contact your local SCORE chapter for information on starting your own business. They offer mentoring programs and a number of online workshops. When I was doing research, I also found a few worthwhile books on Amazon that can help you on your path to entrepreneurship. Whether you’re still deciding what you want to do, or want a reference that will give you even more detail behind the steps to starting a small business, the following books at Amazon will help get you started:
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As a quick note, Part 2 of our “Steps to Start an Online Business” series will cover some sources for ideas of online businesses you can start.
Step 2: Do Your Paperwork
Form Your Business:
One of the first critical paperwork steps to starting a small business is to determine the legal entity type of your business (Five Cent Nickel also has a great explanation of legal entities). In the United States, small businesses generally start as a sole proprietorship, limited liability company, or an S-corporation. Which legal entity you choose is up to you and is dependent upon your own particular circumstances. If you have questions or need advice before starting your own business, I recommend talking with your local chamber of commerce or a lawyer. However, once you’ve decided which entity is best for you, you can file the paperwork (federal and state) rather inexpensively by using services such as Intuit’s MyCorporation or BizFilings.com. MyCorporation and BizFilings can also help you obtain your Federal and State Employer Identification Numbers (EIN), which are needed for tax purposes.
Get Your Licenses:
Depending on where you’re running an online business, or your business model (i.e. what your business does), you may need to obtain the proper permits and business license(s) from various government authorities. The permits and licenses required vary by location, and there are plenty of resources available on the Internet to help you figure this out. After all, you want to make sure all the legalities are satisfied before starting your own business. Again, if you have questions or need advice, I recommend talking with your local chamber of commerce.
Get Ready to Get Paid
One of the greatest parts of running an online business is getting paid, right? If you’re starting your own business, it’s important you separate your personal finances from your business finances. While this certainly makes things easier at tax time, it may also be required (for instance, to maintain liability protection) based on the legal entity you’ve chosen. Chances are there is a bank (or credit union) in your home town that offers checking and savings accounts for small businesses. Some account features you should keep on your radar:
- A zero dollar ($0.00) required minimum balance. This is particularly important if you’re trying to bootstrap your business (i.e. start it with little to no money).
- No monthly maintenance fees.
- Free online bill payment.
One important note about bank accounts for your business: If you plan to sell a product, make sure you find an adequate merchant services provider so you can accept payments. While this may be offered by your bank, make sure you shop around. Erica Douglass (Erica.biz) endorses iPowerpay as a full-blown merchant services provider, and has used it to process payments for the information products she’s created. I’ve used PayPal and Square to process low volume, low value transactions without any issue to date. Some other options for processing payments include Intuit GoPayment, Amazon Payments and Google Checkout. Make sure you read the fine print (fees, maximum transaction limits, etc) and choose a merchant services provider that fits your needs and/or will grow with your business.
Step 3: Build an Internet Presence for Your Business
It should seem logical that the next of our steps to start an online business involve building your business presence on the Internet. As a new (and possibly non-tech) entrepreneur, it may seem like an impossible feat to get this step rolling. However, I have great news – it’s not as complicated and complex as you may think. While there are literally hundreds to thousands of ways to accomplish the tasks I’ll be presenting, I’ll be focusing on the few most popular options that have been recommended to me or that I’ve used personally.
One observation I’ve made in doing research this past year is the concept of a business website has gone through a huge evolution. You can definitely attribute this change to the boom in social platforms and media sites (such as Facebook, MySpace, Twitter, etc). As such, I caution you to truly consider that a blog may be a great way to put your business on the Internet. While you may *think* you simply need a website of a few static pages thrown together, consider that a website built on a blogging platform (WordPress, Blogger, etc) will allow you to initially start with those few static “pages” and then easily transition to regularly updated content which engages your customers. Consider the article “Do Small Businesses Still Need a Website” at Small Business Labs before moving forward with this step.
Choose a domain name:
This is probably the most critical decision you’ll make when building your Internet presence. It is potentially the first chance you’ll have to make your brand memorable to a potential customer. You may be surprised as you go through this mini-step that there is quite a bit of competition for domain names, so don’t get discouraged if it takes you awhile to find a great one. As mentioned in Problogger’s “How to Choose a Domain Name,” some things to consider include:
- Keywords in your domain name – will the domain name help with search optimization?
- Brand-able domain names – will it fit your the brand you’re developing?
- Future-proof domain names – can the domain name grow with your business (new niches, products, etc)?
- Length – is it easy to remember? Hyphens and shorthand (such as “2” instead of “to”) may confuse your customers.
You can hunt for your perfect domain name via registrars such as GoDaddy. However, if you’re looking for a cheap way to register your domain name, hold off on purchasing the domain name directly from GoDaddy (or other registrars) as you can easily do it (for less money) as part of the next step.
Note: Erica Douglass wrote a great article about choosing the best domain name for your business. In her article, she references some bad experiences with GoDaddy. While I’ve not had any difficulties with my own site, it is something to consider ahead of time.
Sign up for Hosted Services via Google Apps Standard Edition:
I may get some hate-mail for this bold statement, but I recommend you sign up for Google Apps Standard Edition versus any other hosted email/collaboration solutions. While there are numerous options available for small businesses (Microsoft Office Live, Zoho, web hosting providers, etc), Google provides a quality service that is rapidly innovating. Google Apps (Standard) is FREE for up to 50 people (except the price of your domain name registration – around $10/year), but gives you so much more than email. You’ll be able to collaborate on documents, chat, share contacts, and build basic websites. Google Apps Standard customers are also eligible to use products in the Apps Marketplace (some free, some paid), allowing you to extend the functionality of Google Apps even further (Payroll, CRM, etc). Plus, if your small business grows beyond that 50 user limit, you can easily upgrade to Google Apps Premier for a small yearly fee.
To help you along, I’ve created an eHow article which will walk you through How to Setup Google Apps with a New Domain Name. A quick note – while integration with Google’s other services is planned, you’ll currently need to manage some of the other Google services (Picasa Web Albums, Reader, etc) with a separate Google ID.
UPDATE: Sign up for Apps-Integrated Third Party Applications:
I recently wrote about Cloud-based Solutions for Vacation Rental businesses. In the article, I detailed a number of products (most of which were free) to help with your other business functions (accounting, marketing, etc). I highly recommend you look into some of these cloud-based back-office business solutions and build your business support processes from the start. This way, by the time your business is successful and taking off, you’ll already be comfortable in the management of your business.
Sign up for Social Media accounts:
Using your new email address, be sure to obtain accounts for sites such as Twitter, Facebook, Picasa or Flickr, and YouTube. These will be key to spreading news of your new business and brand to the Internet masses. Just take a look at “The New Rules of Marketing and PR” (image to the right) to get an idea of how impactful these resources can be. More on this later is covered later in the article, just know the importance that you obtain these accounts early so that you can work them into your website design, etc.
Determine Your Website/Blog Hosting Strategy:
If you’re looking for the cheapest possible way of creating a site, you have three options: Google Sites (part of your new Google Apps), WordPress.com, or Blogger. The site builder in Google Apps is ridiculous easy to use (drag and drop), but the sites definitely “look” basic and unpolished. They also don’t include features to make your site interactive and ready for social media. On the other hand, WordPress.com and Blogger are blogging/content management platforms that make it easy to build a site with rapidly updated content. The templates in these sites can be easily tweaked to create a fairly polished look.
If you’re starting your own business to potentially monetize a website, you should not use WordPress.com. Rather, you should create your website within Google’s Blogger. Blogger’s terms of service do allow you to add revenue streams such as Chitika, Adsense, and Amazon into your blog. Also, Blogger includes tools to help you easily create Adsense ad blocks within your site layout and Amazon Associate links in your posts/pages.
If you’re feeling more adventurous and you want more control of your site, a number of popular hosting companies provide one-click installations for popular content management systems such as WordPress, Joomla, and Drupal. Hosting companies offer different features, so you’ll defininitely want to shop around to find the best hosting company for your situation. Here are a few that I looked at when I was researching for my own website: FatCow, BlueHost, HostGator, GoDaddy, and HostPapa.
If you start on Blogger, you can easily move to self-hosted WordPress and import your content from Blogger. I personally went through this when I first started the MW2ML blog, as I started it on Blogger and later moved to self-hosted WordPress. If you’re still not sure which strategy works for you, ProBlogger has a lengthy, detailed article on choosing a blog platform and Mahalo has an even longer one (with Videos).
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Determine Your Telephone Needs:
Once you start your own online business, you’ll want to ensure you have a phone number for potential contacts and customers to call your business. If you’re an army of one just starting out, I’d highly recommend a Google Voice number. It is free, open to anyone (in the U.S.), and provides an amazing set of features to help you manage your inbound calls, voicemails, and SMS text messages. After all, you probably don’t want to give your home phone number or cell phone number out if you wish to maintain some work/life balance.
Note: You currently can’t port a Google Voice number to a different phone provider. While Google supposedly hopes to enable number porting in the future, it is something to be aware of. This means that down the line, you may need to coordinate a change in phone number with your website and business contacts.
If you need a little more bang (for a little more buck), check into Virtual telephony services such as RingCentral. These service providers can outfit you with Toll-Free numbers, Voice-over-IP, and Internet fax capabilities. Again, choosing the service which is right for you will depend on the needs of the business you’re creating.
Create your website/blog:
There are a number of resources out on the Internet which can show you how to setup a website or blog using your chosen hosting provider. Many of the blogging systems include built-in templates, and/or functionality to import them from any number of free or paid template download sites. Make sure you get all your content created and ready to go before moving to the next step! Also, be sure to sign up for Analytics (such as Google Analytics) so that you can track the source of your traffic and adjust your website as needed.
One of my favorite sites to get templates and logos created is 99 designs. Logo designs are $99, and full WordPress themes and web designs start around $500.
Here is a starting list of resources I used when setting up my own website:
- How to Create a Blog with Blogger – YouTube
- 31 Blog Post Ideas for Small Business – ProBlogger.net
- Jumping on the Syndication Bandwagon (RSS) – ProBlogger.net
- Optimize your 404 page – SmartPassiveIncome.net
- Search Engine Optimization (SEO) – ProBlogger.net
- Setting up your Blogger custom domain – Bloggerbuster
- Intro to Making Money from Blogs – ProBlogger.net
- 10 WordPress plugins for new blogs – ProBlogger.net
There are so many other resources I’ve used, that I can’t keep them straight! If you have a particular question about creating your website/blog, Contact Me and I will create or find a resource for you and add it to the list!
Step 4: Generate Awareness of Your New Technology Business
Get the word out about your new Internet-based technology business by utilizing any number of the items at your disposal. The “New Rules of Marketing and PR” book (shown above) will give you a great start. Other ideas are as follows:
- Tell your friends and family! This is the easy first step to building some recognition and getting referrals to your business.
- Run a small FaceBook advertising or Adwords campaign to build awareness.
- Find blogs about topics similar to your business, and actively participate/comment in the blogs (be sure to include a link to your business)!
- Create some interesting, whacky, or informative YouTube videos. Pat Flynn (SmartPassiveIncome.com) did a great series on YouTube tips and tricks.
- Create a listing in business directories such as the Google Places and Merchant Circle.
- Submit your blog/website to major search engines (such as Google, Bing, and Yahoo) by signing up for their webmaster tools.
- Write a “guest post” for another popular blog. This will quickly generate some traffic to the website/blog of your new business.
- Utilize Social Bookmarking sites to generate Buzz for your online business.
- Create a Facebook page for your business. Pat Flynn did an excellent write-up on Facebook as well!
Step 5: Do What You Do Best!
Once you’ve created a space on the Internet for your new Internet-based Technology Business, and managed to gain visibility/awareness for your business, it’s time to get to work! Focus on reaching the goals you set for yourself in the “Know Thyself” section! I’ve found a number of excellent resources available for technology startups which can provide guidance, networking, and/or access to software:
- Microsoft BizSpark – Software, Support, and Visibility for software startups.
- Microsoft WebsiteSpark – Visibility, Support, and Software for web designers.
- This Week In Startups – Great resource to find interviews of other startups/entrepreneurs and learn the tips/tricks they used in achieving success.
If you feel yourself in need of some motivation or additional help building awareness of your business/brand, there are a number of great blogs to read on the Internet which can help. A few of my favorites are:
As you embark on your journey into entrepreneurship and starting your own business, I wish you the best of luck and lots of success! Stay tuned for Part 2 of Steps to Start an Online Business where I plan to elaborate on “Step 1” by looking at a number of the ideas I’ve found for Online Businesses.
As always, if you would like any additional information on what I’ve covered in this post, feel free to Contact Me!
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