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The Complete Introduction to Online Microbusiness

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Read Time: 6 mins
This post is part of a series called Kickstarting Your Online Microbusiness.
2013 Trends in Online Microbusiness

Let’s start with the dream.

Would you like to be the autonomous owner and operator of a small business? A business small enough to require only yourself and maybe a few contractors, but profitable enough to fund your biggest goals and priciest bucket-list items.

This Session will show you how. The web has made it possible to found highly profitable businesses with nothing more than some cheap hosting, a website, and a PayPal account. And, of course, a whole lot of hard work.

Unlike other business models, a microbusiness is a small, lean operation, highly profitable for its size. Because microbusinesses often require no staff other than the owner, or at most, a small handful of staff or contractors, owners can turn a profit doing work they love and avoid the usual trajectory from excited founder to jaded manager.

For the purposes of this Session, we’ll define an online microbusiness as an online business that can be operated by the owner alone, or the owner plus a few part-time contractors.

Here are some reasons why starting an online microbusiness could be awesome for you:

  • Autonomy. As the sole owner and operator, nobody tells you what to do (except, occasionally, your customers).
  • Flexibility. Your business lives on the web, and if the business is run by you alone, or you and a few web workers, it is a highly mobile unit that can be operated from anywhere in the world, at any time.
  • Compactness. Fewer (or no) staff means less time spent on management than most business owners, leaving space for you to be a jack of all trades and become skilled in many areas, from solving technical issues to marketing to customer support. Alternatively, you can specialize in your field of expertise and hire part-time contractors to fill the gaps, or take care of work you’d rather not be doing.
  • Easy pivot. The pivot is a concept from The Lean Startup by Eric Reis. It describes a significant change to a business model based on customer feedback. A web-based business with minimal staff, simple technology and few physical assets will find it much easier to pivot than most companies.
  • Greater freedom. Microbusinesses can be highly profitable and provide the owner with a wealthy lifestyle on revenues that would not allow a larger company to be sustainable. Because of this, microbusiness owners can pursue smaller, niche opportunities in their areas of passion, like teaching music, martial arts apparel or baseball swing techniques.
  • Less admin. Less staff, less assets, fewer big expenses means less admin required to run the business overall. Many microbusiness owners look after their own financial documents using software like Quickbooks, pay their own bills, and only seek legal advice as needed.

If all these things sound wonderful, a microbusiness might be the right business type for you.

Common Microbusiness Types

Online retail. With the help of ready-made online retail platforms like Shopify and Storenvy, the barrier to entry to online retail is lower than ever. Some microbusiness owners design and manufacture their own products. Others purchase and resell inventory from wholesalers.


Square36.com, an online retail microbusiness.

Self-publishing. eReaders, tablets and smartphones have, according to some, signalled the slow demise of paper books. The rise of digital publishing has created an opportunity for indie authors to earn a healthy living from their writing.


Designing Web Applications, an eBook microbusiness created by Nathan Barry.

Blogging. Ad-supported blogs are still one of the most common and effective types of microbusinesses. Once you’ve attracted an audience, there are a number of different ways you can generate revenue. From ads to affiliate programs to training and consulting to selling your own products, you’ll be able to find a model that works for your audience.


Six Revisions, a blog microbusiness by Jacob Gube.

Online training. Any valuable skill can be monetized through a teaching-based microbusiness. Training can be sold in the form of a video course, eBook series, web conferences, audio downloads, or 1-on-1 consulting sessions via Skype.


DJCoursesOnline, an online training microbusiness.

Web application. If you’re a designer or developer, or willing to hire people with those skills, building a web app that provides a valuable, automated service to clients could be the recipe for an excellent microbusiness.


Clockspot, an online software microbusiness.

Niche site. A niche site is a website full of in-depth content about small niches like setting up a food truck business, raising tropical fish, or long-distance running on a vegan diet. Niche sites are typically monetized with display advertising, such as Google AdSense.


SecurityGuardTrainingHQ, a famous niche site created by blogger Pat Flynn.

Affiliate. If you love using a particular product or service, you can often make an affiliate income from sales generated through your reviews and coverage.


PayMyStudentLoans.com, a microbusiness that makes money through commissions.

These are just a few of most common types of microbusiness, but there are many more.

A Microbusiness Case Study

An excellent example of a microbusiness is Music Teacher’s Helper, created by Brandon Pierce. The business premise: a web application to help private music teachers run their teaching studios. The application runs on a subscription model of three monthly plans of $14, $29 and $49 respectively. The more expensive plans allow teachers to track more students.

At last reporting the application was generating more than $25,000 a month in revenue. The full staff list: Brandon (the owner and creator), and a handful of marketing, programming and project management contractors working remotely. Because this small team of staff are remote, Brandon and his family are able to run the business from Costa Rica.


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Is a Microbusiness for You?

We’ve gone over the best aspects of starting an online microbusiness, but what about the negatives? Here are a few things to watch out for:

  • Running a microbusiness can mean that you are often working alone. Running a business from your laptop and interacting mainly with remote staff could be a recipe for loneliness if you're an extrovert. If so, you should think about running your microbusiness from a co-working space.
  • A microbusiness is not going to make you filthy, ridiculously rich. A company with few staff will run into scaling problems if it starts to become too big, problems that will require more staff to solve. A microbusiness could make you wealthy, but becoming mega-rich will require you to grow from microbusiness to fully-fledged company.
  • A microbusiness's success can be subject to factors outside your control. If the majority of your income is coming from one online microbusiness, a Google algorithm update that takes a poor view of your site could lead to a significant drop in income. Diversification can help you to weather such storms.
  • Low barriers to entry make it easy for competitors to take market share. Any successful microbusiness must be prepared to face competition, especially when the barriers to entry are low (for example, a niche site or blog). The more complex or difficult to recreate your microbusiness is, the tougher it will be for competitors to try to replicate.

If these things don’t bother you, then you’re ready to take the next step and start thinking about which kind of microbusiness will play to your skills, resources and interests. We’ll be covering this in the second part of this Session on how to kickstart your online microbusiness.

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