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Starting Your Web Based Company

Sometimes websites supplement an existing business, sometimes the website is the business. This advice is directed at those of you thinking of starting a web based business. Some of it might sound similar to our search engine optimization advice but that isn't entirely unexpected. For starters obviously success on the Internet is often tied to search engine rankings. Secondly at its core making a dent in the SEO world is pretty much the same thing as trying to make it in the business world. It's marketing aimed at search engine's and people, instead of just people, to try and impress more than the competition is.  

Unfortunately making it on the internet can be a good deal harder than making it in the real world. In the real world you can be the only widget store in the local mall. The Internet a giant mall that, probably, already has many stores that do what you want to do. On top of that, people know those stores already, and how to get there. Your store, on the other hand, they've never heard of, and it's being built in a new wing of the mall no one knows exists yet. The odds are stacked against you. 

From Humble Beginnings

One advantage over brick-and-mortar businesses is that you can keep your margins very low. It's fairly standard startup advice to assume you're going to have some lean times to get started. Without a building to pay for, and people to be there when you can't, you have the option to go ultra lean. A mistake people can make is assuming too soon in the process the website will be a smashing success. Yes, a website means anyone in the world can shop there, but they have to find you first, and they'll have 20 other options, even for fairly niche ideas. Don't hire people to manage this-or-that before there is something to manage. Be prepared to be customer service, the shipping department, etc, until it reaches the point where you just can't do it alone. Along those lines, don't quit your day job just yet either. Another advantage a web based business might give you over starting a brick-and-mortar company is that you don't necessarily have to be  "there" 40+ hours a week 8-5 M-F. That being said...

Websites are Hard Work 

They're not something you pay for, and then sit back and wait for the money to roll in. Maybe they won't be something you spend 40 hours a week on, but you're setting yourself up for failure if you think your only contribution is being the idea person, and someone else will take it from there. I'm not going to claim there are no businesses anywhere, online or in the real world, where someone went, "You know what would be great, a company that did _______," proceeded to hire someone to build a building/website, hired some people to run it, and then turned a profit 3 weeks later. However, I'm guessing those are few and far between. Be prepared for some long days and some nights spent reading search engine optimization blogs, pouring over your newest keyword research and your current rankings, updating your site's content and social network profiles, and other such things. 

Think Big By Thinking Small

Sometimes the only way to make it in a mall that has 300 million stores, which all have  a head start on you, is to be one of the 3 stores that sell something 100 people are looking for, rather than being one of 3000, that a million are. I can almost guarantee you that, while neither is probably a ticket to millions, you'd have better success selling covers to "pretty up" specific models of refrigerator water filters online than you would being the 20,000th person to try and sell rubber iPhone covers.  Furthermore, along those lines, someone selling customized rubber iPhone cases would likely find more success than someone that sold iPhone cases, coffee, books, gum, and laptops. If there's a key to "easier" success on the internet, in my opinion, this is it. Find a niche, fill it, and don't deviate from it. The role of internet "general store" is filled by people your site can't compete with. You might make a better ___ than the 2000 people before you, but people have to notice in the first place to know. If you're the only place on the internet  the small percentage of people on the planet who would think "man that water filter dangling back there is ugly, and I'm willing to spend some money to make it look like a city water tower, or something" can turn to, then your job of getting noticed is easier. 

Don't Panic

If you'll allow me to shift away from the mall metaphor; Every year in the world of sports the following plays out:

1) During the offseason all the experts claim that a team has to go through "rebuilding" in order to have long term success.

2) These same experts laud the team for cutting this/that player and for otherwise making moves that place thriving long term over rolling dice on short term.  For example, an NFL team deciding to go through the growing pains that almost every new quarterback has, because again, even though it will mean few wins and hard times in the upcoming season, and even though no one WANTS to fail now, sometimes it's inevitable, and the goal is longer term success. They'll say things like: "The team needs to let Joe Rookie play, even though he'll probably flounder, and bring the team down in the process. If they want to win championships someday, they need to tough this period out. He's the guy they need to let get his lumps in." And so on.

3) The season starts and, just as predicted, the team fails.

4) The same experts suddenly forget that the failure was entirely predictable, they themselves said it was necessary/inevitable, and to some extent a good thing...and freak out about how the team needs to fire the G.M./Coach/Quarterback/Everyone.  "Joe Rookie is really floundering out there, and is bringing the team down. You have to think the coach's job is on the line if he doesn't improve A.S.A.P."

5) (Optional) The team does succumb to pressure, abandon the plan, make some panic moves, and, for the most part, make things worse and for longer.

Remember when I said to prepare for some lean times? No one wants them, but almost everyone will have them. Brick and mortar stores generally claim 2 years as the guideline to profitability. Since the cost of "entry" is less on the internet (no building/staff) people might be tempted to think that's less, but they forget to account for the fact that it can be harder for people to just "stumble upon", and that you're competing with everyone everywhere that does the same thing. A real store is going to have a few curious people drop in in spite of what the store might be doing. A new restaurant is going to get SOME walk in patronage just by existing. Your website, on the other hand, won't. There's no "directory of every place new on the internet today" people browse, and even if there was, there'd probably be too many sites in there to be noticed anyway.

Forget "profit" for the first long while, you might go those first few weeks without a real/unprompted hit, and the first few months without a sale. Remember: this is the plan. It's not your desire, sure, but it's entirely expected. Avoid the temptation to "double down" on "it must be because my website doesn't do ____" situations. To be sure, there might be something easy to accomplish that really does have obvious avenues to more income. However, be sure you aren't making the move largely because your site, as is, isn't succeeding yet. It was always going to take time to get a foothold. Everything you pay someone to do for you is that much longer until you are turning a profit. 

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