The entrepreneurial bug often bites when we need money the most. You have the idea, you have the drive, but at the moment, you don’t have the funds to start your business.
Or so you thought.
It’s easier than ever to launch an online business with very low start up costs. It seems like nearly everyone you meet has some sort of side-hustle going on, and that’s because there’s a very low barrier to entry when it comes to starting an online business.
In this post we’ll:
- Cover the most common types of online businesses that people gravitate towards
- Break down the basics of the most common business types
- Look at the 3 business types that are often the most profitable
- Find out how to get started in one of the three most profitable business models
What types of online businesses exist?
Honestly, the options are limitless, but most people tend to gravitate to one of the more common options.
Not all online businesses are created equally though, and depending on your goals what works for one person might not work for another.
I’ll break down the 7 most common online business ideas that you can start for cheap, and then discuss what I believe the most profitable three are.
Online coaching is a common entryway into entrepreneurship. Online coaching usually means trading your time for money and meeting either 1-on-1 or in a group to walk clients through a specific topic.
To be an online coach, all you really need is something to teach and a solid marketing plan. Coaches can cover topics from health and fitness to meditation and art creation. If you’ve got a skill, you can coach other people and make money from it.
Coaching online is great because you can reach a larger audience than you’d be able to locally, and you can automate large parts of your business.
As far as a marketing plan goes, this is where people tend to have to make an investment.
Whether you decide to create a website, sign up for an email management system, or market solely on social media, you will need to spend a few dollars instead of going the completely free route.
Here are the potential investments a coach might (but doesn’t necessarily need to) make:
- A professional website and hosting - ~$250
- An email management system - ~$25/month
- Social media automation - ~$10/month
- An HD webcam for video calls with clients - ~$50
Nowadays, just about everyone has a blog, and it’s not too difficult to make money with a blog, either.
You can monetize a blog through ads, affiliate links, or working with brands to promote their products. Blogs can be very profitable, but it can take months or years to build enough influence to make any real money.
With that said, if you’re willing to put in a few months of profitless leg work, you can build the foundation to a successful blog and passive income.
I’ve been earning money through my blog for several years now, and have found that bloggers can expect to make around 1% of their average page views. If a blogger gets 50,000 views a month, they’ll make around $500. So if you’re able to devote yourself to driving traffic, you can end up making a fair amount of money each month.
It’s not a perfect formula, and one that blogger Amy Andrews came up with, but if you’re earning using ads and affiliate income I’ve found that it rings pretty true.
On the other hand, if you begin to partner with brands and do large sponsorships, your earnings can be much higher depending on the scope of the partnership. You can find sponsorships on websites like Social Fabric.
Plus! Having a blog is beneficial down the road. We’ve talked in the past about launching your online course using your blog, so if you ever decide to sell a product, you’ll have a marketing site already built and a loyal audience already ready to buy.
Here are the potential investments a blogger might (but doesn’t necessarily need to) make:
- A professional website and hosting - ~$250
- An email management system - ~$25/month
- Professional headshots and images for your blog - ~$150
- An email management system - ~$25/month
- Zapier, for making all your platforms work together - ~$20/month
- A professional quality camera - ~$300
- Photo props or outfits for shoots - ~$100/month
- A professional quality camera - ~$300
- A professional website and hosting - ~$200
- UpWork fees - between 5% and 20% depending on your overall earnings
Creating and selling your own online product
You knew I was going to get to this one. Online courses and other products are a great way to earn money quickly if you’re serious about starting an online business.
With strategic audience building you can build a targeted and warm audience while creating your online product. By the time you’re ready to launch, you’ll already have a group of people primed to buy.
But more on that later.
For now, let’s talk about why online products are so profitable. In short: Depending on the price of your product, you only need to make a few sales a month to be extremely profitable.
If you can get 20 people to pay $200 each month, you’re making more each year than the median of American workers.
Here are the potential investments an online product creator might (but doesn’t necessarily need to) make:
There’s a joke out there that every teenager with a camera is an Instagram model now, but the thing is, it’s not a bad business plan.
For perspective, social influencers, especially on Instagram, can make five figures on a single sponsored post. Even influencers with just a few thousand followers can make several hundred dollars per post.
Social influencers basically accomplish these three things:
- Grow their followings to establish influence
- Create a curated or “themed” account to attract sponsors
- Get paid to promote sponsors
Anyone can be a social influencer. Heck, your pet could be a social influencer. My friend Stephanie is a social influencer herself, but her following is a fraction of her roommate Atticus’s.
Stephanie has established relationships with brands like West Elm and Book of The Month Club all through her hedgehog’s account.
If you’re willing to get creative, you can be a social influencer without ever stepping foot in front of the camera. There are accounts like Men and Coffee that are curated and post solely other people’s content (with permission!) and have established huge followings and monetize their influence.
Here are the potential investments an online influencer might (but doesn’t necessarily need to) make:
Becoming a YouTube content creator
YouTube has always been one of the most profitable ways to make money online without having to know a thing about business.
When I was in middle school I used to watch other middle school girls share their beauty and makeup expertise, and now those same girls I watched a decade ago have continued on YouTube and make six figures monthly from the platform.
Now, not everyone who joins YouTube will be an instant success, so like with blogging, you need to be patient and dedicated to grow your following. YouTube also recently added new restrictions to monetization, so brush up on the requirements and make it your goal to reach them.
You can earn money on YouTube through ads running on your videos, affiliate links in the description box, and paid partnerships with brands.
The amount you make will be directly correlated to the amount of influence you have. Typically, YouTubers make more than bloggers even for equally sized audiences. This is for a number of reasons, but a big one is that video is more “shareable” and converts better.
You can also sell your own products—physical or digital—online. A popular website to do so is Etsy. On Etsy, you’ll find everything from artists selling custom family portraits to developers selling WordPress themes and crafty grandparents peddling crocheted baby booties.
Etsy is a little different than the other options I’ve mentioned because it tends to be a lot less passive.
Unless you’re selling something digital like a Wordpress theme or a meal planning template, every time you get an order you’ll need to fulfill it by creating the product, packaging it, and taking it to the post office.
For some people, that process is very rewarding, but others want a more passive business model.
If you do decided that Etsy is right for you, get excited! There is massive earning potential with the top earners in 2017 making millions of dollars.
And even if you aren’t in the seven-figure club, no worries. There are thousands of makers earning five and six-figure salaries on Etsy.
Become a freelance writer
If you have a way with words and a wallet crying out for some extra cash you might want to consider becoming a freelance writer. Freelance writing simply means you write for multiple brands without being tied down to any of them.
There are a lot of ways you can get started freelancing—whether you reach out to publications directly or build a portfolio and wait for customers to come to you. You can also sign up for websites like UpWork, though you should be aware that there’s a lot of competition there.
Either way, the more proactive you are the more successful you might be.
The average full-time freelance writer makes $42,000 a year, or $3,500 a month. Which is just under the median earning wage for employed adults in the United States. Not too shabby
The best businesses to start for cheap
After digging into the numbers and evaluating the startup cost and time, I figured that the tree top ways to earn money online with a minimal investment are:
- Creating and selling your own online product (are you surprised??)
- Creating and maintaining a YouTube channel
- Creating an online coaching business
Let’s break down how to get started with each.
I’ll break down the foundation you need to establish to get started earning with each. We’ll start with online products because they are the number one way to make money online quickly with very little startup fees.
Creating and selling an online product
Creating and selling an online product is great because you can create the product once and sell it over and over again for the next decade should you choose.
You can also recycle your marketing materials, sending the same emails to all of your new subscribers and recording and sending out the same webinars.
How to get started selling your online products for free:
You can sell just about any online product through Teachable and we have a free price plan with our most basic features—so you can get started even if you’ve got zero dollars to your name.
You can start with our free plan and build out your mini course to grow your audience. A mini course is exactly what it sounds like - a small scale course - that helps you build your audience.
Mini courses will cover one very targeted aspect of a topic in your niche, and might only have a total of ten module max. People either give their mini course away for free as a lead magnet, or they’ll charge very little for it.
We see so many people offering “mini courses” that could be stand alone products selling for hundreds of dollars because the creator got carried away. And while it’s incredibly generous to give away all of that for free, that’s not our goal today.
Creating a mini course is actually quite formulaic, too:
- Create ONE section in a Teachable course.
- Add course information as text lectures.
- Add a valuable download.
- Add images to your text if necessary to explain what you’re doing.
Try to use only one section, and try not to add more than 5–7 steps.
You can also use video in your mini course, but again, try not to get carried away. Instead, create a single introduction video and a single video in your mini course. Keep with text lectures and valuable downloads for most of your content. We’ll save the high-value videos for your main offer!
For more on getting started with your mini course, check out this blog post.
Once people have signed up for your mini course and you’ve began to grow your audience, consider creating and launching a full scale course.
Once you know what your online course will cover, begin creating the curriculum. Your curriculum acts as the skeleton of your online course. You’ll build everything around your curriculum, it acts like an outline.
Here’s an example of how I might create a curriculum. Notice that I’ve got a transformation and then listed the steps people will take to reach their desired result.
After taking my course, people who are trying to start a blog will have beautifully designed websites and they’ll have a clear idea of what content to publish. They’ll feel confident about the direction of their site, and have ease when it comes to choosing which content to publish and promote. People who take my course will be able to:
- Choose and purchase a domain
- Set up hosting
- Set up Wordpress
- Choose a theme
- Create an editorial calendar
- Set up social media sites for their blog
- Create and promote their content
You’ll see above that I have seven main “milestones.” As a rule of thumb, we generally recommend choosing between 5-10 milestones.
If your course has more than ten milestones, ask yourself “why?” Is it because your topic really is so extensive, or should you break your topic down into multiple smaller courses? If there are too many milestones, you may want to go back and redefine your topic.
On the other hand, too few milestones might mean that your course would be better off as a mini course. Trust your gut.
Once you’ve defined your milestones, break them down into lessons.
As a rule of thumb, each lesson should cover one major takeaway and won’t take more than ten minutes to explain.
Let’s break down one of our example milestones into lessons:
- Milestone: Create an editorial calendar
- Lesson one: What is an editorial calendar and why do you need one? (8 minutes)
- Lesson two: Digital or physical planner? (4 minutes)
- Lesson three: Everything to include in your editorial planner (7 minutes)
Now all that’s left is to film! While not all courses require video, we do find that the majority of our course creators are at least a bit interested in including video in a few lessons. If you want to use video in your online course, check out this blog post.
Once you’ve began creating your course, you should also start building your audience. If you’re going to build an email list (which we highly recommend), MailChimp is free up to your first 2,000 subscribers, so I recommend signing up there.
When it comes to actual video production, use equipment that you already have. Don’t be fooled into thinking you need the nicest DSLR or a $600 microphone. You can get away with your cell phone or webcam.
Programs like Canva make creating beautiful marketing materials easy. Even if you don’t have a design savvy bone in your body, you can use their plug-and-play templates. Once you’ve created marketing graphics, turn to social media.
Accounts on the most popular sites like Facebook, Twitter, and Instagram are all free so long as you’re not looking to pay for ads.
Start a YouTube channel
YouTube certainly isn’t for everyone, but if you’re interested in being in front of the camera, it can be an incredibly lucrative career.
You get paid via ads depending on how large your audience is, but you can also partner with companies to promote products that you love. In the future, you can also harness the content you’ve already created and your audience on YouTube to create and sell online products.
The key to being successful on YouTube is being consistent and creating high quality content. Unlike with online courses, you probably can’t get away with just filming on your webcam. But even a high quality cell phone camera can make the cut.
How to become a YouTuber for free
Obviously, you’ll need a YouTube account if you don’t already have one. YouTube accounts are easy to sign up for, and they’re free.
From there, decide on what type of content you’d like to create and start creating. The only way to really find success on YouTube, though, is to consistently show up with great content. Even the people who seem to have been overnight successes usually have been working at it for months and finally have a video go viral.
Once you’ve reached your threshold for video views and subscribers, you’ll be eligible to monetize your account via Google Analytics.
You can also monetize by partnering with brands. On websites like FameBit you can apply for relevant sponsored video opportunities, some of which come with a five figure paycheck.
Become an online coach
Online coaching is great for people who really want to work hands on with their customers. Online coaches exist to help people solve problems they may be having or improve certain areas of their lives.
Coaches are limited in the number of clients that they can take on, so they’re able to charge premium pricing. So even if they’re only working with 8 people a month, that could easily translate into $5,000.
Getting started coaching is probably the most difficult out of the three options because first you really need to establish yourself as an authority.
People will buy courses from someone even if they aren’t quite familiar with them, because selling a course establishes somebody's authority off the bat. People are more skeptical with coaches.
I recommend building up your reputation on just one or two social media sites. Depending on your niche, I would recommend Instagram, Quora, Twitter, or Facebook.
How to get started for free:
Sign up for relevant social media sites and start sharing niched content. Engage with others in your industry and answer people’s questions. Your goal here is to get your name out there and build people’s trust.
Once you’ve established a bit of authority, start pitching your coaching services. You can sign up for a free Teachable account, and sell your packages through us.
Teachable makes handling transactions easy, and you can create a beautiful sales page without having to fuss with a lot of technical know-how. If you want to sell coaching packages on Teachable, set up your sales page and make the only lesson an introduction video and a link to relevant resources your clients will need.
Whether there is a private facebook group or a calendar to sign up for coaching sessions, make Teachable the one stop shop for your clients where they can find everything in one place.
Do you have an online business? Let us know what it is in the comments! And as always, if you have any questions let me know and I’ll get back to you.