Irrespective of its size, scale, and nature, there are certain things that are must-have for every entrepreneur for the purpose of building a successful and profitable online business.
If you want to build a successful online business for earning passive income in the long run, make sure you are aware of these pre-requisites.
Let’s have a look at the most important ones – in order of importance.
1. Resources – Time AND/OR Money
It is the first and foremost requirement to build any type of business.
Resources include cash and time. You cannot create and run a business without investing cash and devoting time to it.
If you have the money, you can save tremendous amounts of time by investing in a course, thereby cutting the learning curve.
At the same time – by investing in training – you are skipping the trial and error process, which saves you time and money.
Learning from others allows you to go directly from Point A to Point B.
2. Essential Tools & Software
Some hardware tools & software are needed to work with speed and efficiently.
These include a computer/laptop and other gadgets. In addition to that, make sure you have fully-functional bookkeeping software installed on your system for record keeping and management (or outsource accounting altogether).
Here are what I consider must-have’s; all of which are relatively inexpensive.
- Virtual Private Network (Hide your location, bypass censorship.)
- Secure Cloud Storage (To back-up all your files.)
- YubiKey (To secure all your online accounts.)
- Google Analytics (To track traffic & visitors to your site.)
Do I need a Laptop/Computer?
It’s pretty common sense that you will also need a computer or laptop to work on your online business. An iPad or tablet won’t cut it. I wanted to address this topic separately as you might be asking yourself,
Should I get a lightning fast laptop (expensive) or a regular one (cheap) and invest the saved money elsewhere?
I recommend getting the fastest laptop/computer you are able to afford. As an entrepreneur, your time is your most valuable asset. An inexpensive model might be tempting, but you’re paying with time – losing 10 minutes here, half an hour there.
Over time a slow laptop/computer will lead to thousands of hours of lost productivity. You have to decide if that’s really worth saving a bit of money …
By the way, the same would apply to Internet speed. If your Internet is very slow, that’s the first resource you need to upgrade/invest in.
3. Website – Your Online Property
Your website (domain) is the foundation of your online business – it’s how people find you online. Getting your very own domain (that’s the URL) is inexpensive; here’s how to do that.
You could also buy an existing site (to instantly rank in the Google search results) or snatch an expired domain.
Every business requires a strong online presence in order to survive the cut-throat competition in the digital market.
Use effective SEO techniques and other marketing tools to grab the attention of one-time visitors and turn them into your customers.
4. E-Mail Marketing
I’ve talked in great length about the importance of email marketing. By capturing email leads, you are taking full control of your online business.
Your social media accounts could get terminated, algorithms change – your email list is the only thing you can keep forever and have 100% control over.
Many people dread email marketing thinking it’s complicated, or they’re simply not aware of it’s importance.
The reality is that email marketing is easy to set up (see here) and free to start out with! Mailerlite (the provider I’m using) let’s you collect up to 1,000 subscribers for free; beyond that, it’s just $10/month.
If email marketing is free, easy to set up and you’re still not doing it – you are not serious about building your online business.
5. Social Media
For the average person, social media is a way of staying in touch with friends and/or simply kill some time.
For the online entrepreneur, Facebook, Instagram & Co. are essential tools to drive visitors to his website. All of this platforms are important but I don’t recommend you manually manage your social media accounts.
Updating profiles, posting content … all of which can 1.) be very distractive and 2.) cost a lot of time. I recommend you either outsource those tasks to a virtual assistant, or better yet, use automation tools such as FollowLiker and IFTTT.
Specifically for YouTube marketing, you can choose between HootSuite, VidIQ and TubeBuddy. Not only to automate some of the tasks (posting videos) but also to get insights in regards to what is working (and what isn’t).
6. PayPal Account
PayPal still is the gold standard when it comes to online payments. Most people have a PayPal account which makes it very easy to sell products, receive and send money.
There are many PayPal alternatives, but PP is the easiest to start out with. You sign up and instantly are able to sell products/services via your website.
To be clear, this is to get the ball rolling and be able to receive payments from the get-go. Further down the road, you can reassess whether PayPal is right for you and if it’s not, switch to an alternative payment provider such as Gumroad, Stripe or 2Checkout.
7. Bank Account
When setting up an online business, you can start with a personal bank account under your name. However, if you are aiming to build a corporation, it is recommended to open a corporate bank account in the name of your online business.
One easy way of doing this is by running a location-independent online business via the e-Residency program.
A ‘real‘ bank account is required because while you are able to receive money to an electronic money account (such as PayPal), I don’t recommend keeping your funds there long-term.
8. Landing Page
Once all the previous steps are taken care of, growing your online business becomes a priority. By now you have a website, visitors and are able to receive payments.
If you have a product or service that you sell, the way you present it can make the different between not making money at all and having a stable passive income stream.
You could just use a regular site on your website to present your product/service. However, that’s not very effective. Instead, use a landing page.
A landing page is a page dedicated to one single purpose. Laser-focus, so to speak. That purpose can be to sell something, or get the visitor to enter his email address.
9. Outsourcing / Virtual Assistants
The final step of expanding your online business lies in outsourcing. If you want your business to grow at the fastest pace possible, you need to outsource the majority of your tasks.
There’s only so much you can do in a day – whether that’s writing an article, editing a video or working on your product.
If you’re not a designer but try to create your own website design or logo, you’ll most likely end up with something that looks very unprofessional (at best).
You never want to convey a lack of professionalism. All designs you use should exude one thing: Trust. That way people are more likely to pay for you/your products.
The only way to achieve that is by using professional designs.
10. Credit Card
An online business also comes with its own set of expenses. Right from buying a hosting package and domain name to paying for analytics and other online tools, you need money to pay for these expenses.
Some of these service providers accept credit cards only.
There are many ways of getting a credit card (depending on where you live).
Pre-paid cards are also an option the only downside is the convenience factor and that they make tracking expenses a bit more difficult.