The Ultimate Guide To Starting an Online Business
By reading this Ultimate Guide you’re already taking the first steps on your journey to a Rich Life. This is only an introduction to the ideas and material you’ll find inside IWT. I started this site in 2004 while I was studying technology and psychology at Stanford. I’ve spent the time since testing and honing my Rich Life systems on thousands of successful students.
At IWT you’ll learn –
Buy all the lattes you want. A $5 coffee is not going to change your financial life. But learning how to automatically invest, how to select the right asset allocation, and how to negotiate a $15,000 raise will. I believe in asking $30,000 questions, not $3 questions.
Your Rich Life is yours. A Rich Life can be picking up your kids every day from school. Or buying a $1,000 cashmere sweater. It can be buying a round of drinks for your friends, or traveling for 8 weeks per year. You decide. Your Rich Life is yours. (Here are some of my Money Rules.)
There’s a limit to how much you can cut, but no limit to how much you can earn. I have readers who earn $50,000/year and ones who earn $750,000/year. We’ve helped tens of thousands of people earn more money by negotiating their salaries, investing, and starting businesses.
Spend extravagantly on the things you love, as long as you cut costs mercilessly on the things you don’t. I don’t believe in cutting back on lattes. In fact, I want you to spend more on the things you love. What if you could double your spending on travel, or eating out, convenience, or charity? I call those Money Dials and I’ll show you how.
The 85% Solution: Getting started is more important than becoming an expert. You don’t need to be perfect to take control of your money. It’s OK to make mistakes. Get 85% of the way there and move on with your life.
Investing should be very boring—and very profitable—over the long term. I get more excited eating tacos than checking my investment returns. You’re in control. This isn’t a Disney movie and nobody’s coming to rescue you. Fortunately, you can take control of your finances and build your Rich Life.
Money is political. You can simultaneously acknowledge personal responsibility and real systemic problems. This is a core part of the I Will Teach You To Be Rich philosophy. Housing is political. Healthcare is political. Voting rights are political. If you’re looking for bland tips on cutting coupons, this site is not for you. I consider it a tragedy to live a smaller life than you have to. So many of us have been raised to believe that money is something to be scared of. We use phrases like “I’m not good with money” or “Money changes people.” Yes, money does change people.
Money allowed me to dream bigger, to be more generous, and to be more adventurous. It can do the same for you. A Rich Life is lived outside the spreadsheet. What’s the point of all this saving and investing if you’re simply going to wait until you’re 80 to live? No thanks. I believe that once you’ve set up your finances, you’ll see that the most important part of a Rich Life is outside the spreadsheet—it involves relationships, new experiences, and giving back. You earned it. Welcome to your Rich Life journey, I’m excited to see what you do next.
The New Business Reality
Escape the 9-5 and start a business that pays you to live the life you want:
- Work from anywhere
- Make your own hours
- Get paid even as you spend time with friends and family
That’s not hype. It’s the new business reality.
To get started, you don’t need an MBA, venture capital, or special connections.
With a small amount of money and time, you can create an online — even automated — business that serves the roaring ocean of people on the internet.
Millions of people willing to pay you…if you can solve their problems.
Maybe you’re the person that friends come to for relationship advice.
Maybe you’re a wiz with Excel. Or have great taste in fashion.
You can turn skills you already have into a profitable online business.
Then scale it to earn as much as you want, automatically.
I know, because I’ve done it. And I’ve shown thousands of others how to do the same.
For the past 12 years, I’ve helped hundreds of thousands of people live a Rich Life using psychology, systems, tough love, and no-B.S. action steps.
Success story: Bryce Conway
The “frazzled entrepreneur” who went from $500 to $14,706/month and built a business that runs by itself.
* Watch founder Ramit Sethi on Netflix
* Get the NYT-Bestselling book
* Check out the hit podcast
And join over 800,000 readers getting our Rich Life Insiders newsletter:
Why Online Busines?
I started my blog in 2004 when I was studying at Stanford. Back then, it was just an ugly blog that no one read.
It wasn’t until 2007 that I created my first product: A $4.95 eBook that I was afraid to sell because I didn’t want to seem “salesy.” It was the first time I charged readers for my material. They responded by calling me a “sellout” and saying I “jumped the shark.”
Fast forward to today, that blog has become a multimillion-dollar business. We’ve launched over 18 successful products — including courses on career development, psychology, fitness, cooking, and freelancing. And we’ve built a business with over 30,000 paying customers.
But most importantly, the company I started has more documented success stories than anyone else I know of — more than 20,000 at last count.
I’m not telling you this to brag. But there’s a lot of horrible information out there about online business. Some of it is even dangerous. If you want to avoid it, you need to be able to trust the person giving you advice.
The Dark Side of Online Business
If you’re like me, you’ve seen a million sites promising to help you get rich quick. Or posting cheesy inspirational quotes about success while their own business struggles.
But some of the most dangerous information comes from the countless blogs that focus on the minutiae of starting an online business. The ones that say, “You have to start a podcast! And get on social media! And don’t forget to learn SEO!”
It’s overwhelming. Following that advice leaves you spinning your wheels, not getting anywhere. You’re stuck in Marketing Tactical Hell.
But it doesn’t have to be that way. You can start a business that’s genuine, authentic to you, and provides real value. Just like thousands of my other students. This guide will show you exactly how to get started.
Anyone can WANT something. Few will actually take action on it.
Who is This Guide For?
This guide won’t take you from zero to $100,000 overnight. Instead, it will show you the first steps in building an artisanal business that provides real value to your clients. We won’t be singing kumbaya around a fire. I’m sharing battle-proven strategies and insights discovered by our team of successful entrepreneurs, our students, and the friends we’ve made building this company from a tiny blog to a multimillion-dollar business.
You will find the material, tools, and mindsets to start a business that gives you:
What We’ll Cover in the Next Sections:
- Proof you can have a successful online business
- How to start a high-profit, low-cost online business
- Success mindsets: How to become the type of person who can have a 6-figure online business
- How to find your first profitable business idea (even if you have no skills, credentials, or experience)
- Technology toolbox: Simple tools to earn your first $10,000 online
- Next steps: From Zero to Launch
Proof You Can Have a Successful Online Business
In the past, people’s lives followed a traditional path: Graduate college, get an entry-level job, work for the same company for 45 years, then retire to a beach in Florida.
Those days are gone (thankfully).
You can create a website in minutes, start blogging, and share videos on YouTube that get seen by hundreds of thousands of people. With less than $100, you can start your business and have access to more customers than you could ever need. (This is exactly how my business started.)
You can start almost any kind of business.
And you can set up your business so that it’s completely automated. Your online business can keep working even when you’re not. You can earn money while you sleep — a game-changer.
But when you’re at square one and don’t even have an idea, it can look impossible. So let’s break it down so you can see how simple it really is.
The Math of Online Business
Let’s say you have a goal of making $100,000/year with your online business. Sound daunting?
You can do it. It’s not magic, it’s math.
The key is to stop thinking in terms of trading your time for money and start thinking of systems. That’s what an online business is — a sales machine that does the work for you. You front-load the work and keep profiting from it year after year.
If you have a $500 product and make just 1 sale a day, you’ll hit $100,000 in less than 7 months.
Even if you choose to do half of that, that’s $100,000 in 14 months — life-changing. And that’s just the beginning. The real magic comes when you add a second product. And then a third.
Check out this chart on how you can start with a simple $50 product and scale your business up to $100,000/year.
The best part of all this? YOU decide how big you want your online business to be. You can stay at $1,000/month or scale it to $10,000 or $100,000/month. It’s up to you.
Building a successful business isn’t magic, it’s math.
Personally, I chose to scale. So let me walk you through exactly how I went from earning next-to-nothing with a $4.95 eBook to $600,000 within a week.
Ugly Blog, No Comments, No Money, Ugly Barriers
I started my blog in 2004, but it was just an ugly blog that no one read
I didn’t know how to make my design look better, so I used a free pre-made template.
At first, it was brutal. Nobody left a single comment. But over time, things started to change. I started to get traffic. People left comments. And I even got a little media coverage.
On the other hand, I still generated $0 in sales. I had no idea what I could even sell. And I didn’t want to be “salesy.”
It’s one of the best things I’ve published, and totally free – just tell me where to send it:
Key Takeaways at This Stage:
- I started to see a little traction — a few comments, a little traffic, but I didn’t 01 really understand how to go from “here” to “there”
- I didn’t understand what I could do besides more of what I was already doing. And remember, I was making $0
- I decided “I don’t know” was not an excuse. I started to learn about different business models and started learning lots of different ways to go from “passion” to “business”
The Terror of the First Sale
The first thing I ever sold online was a $4.95 eBook. As you can see, I had a flair for names even back then.
I had such low self-confidence that I didn’t think anybody would buy it. And I was petrified they would call me a “sellout” for selling anything.
But you know what? This was a huge turning point. That first sale was one of the most exciting moments of my life. You begin to think, “If I can get one person to buy, I can get 10, 20, or 100.”
And if you can sell a $4.95 product, then you can sell one at $50, $500, $2,000, even $10,000.
$600,000 Launch: IWT Gets More Sophisticated
Once you’ve realized you can sell, the sky’s the limit. For me the big change came when I launched Earn1K — this was my first crack at a really sophisticated course.
Like an awkward kid going on a date for the first time, we were kinda ready, but kinda not.
A big success isn’t the ceiling, it’s the foundation for the next leap.
My business had grown up and we had new capabilities, like our research knowledge, but we didn’t have things like a real video studio.
We actually had to BORROW a “studio” to record in! It was hilarious
The company’s employees would literally come in while we were recording and say, “Uh, we have a meeting right now. Can you go outside?” and we had to just stop recording and leave. Another time, we shot on 9th Street in San Francisco and a homeless dude started screaming right outside. Not great for video, I can tell you that.
But things were starting to take shape: People bought the course at $497, or 100 times what I had charged for my $4.95 eBook. We made $600,000 with that launch — our biggest to that point.
Interestingly, the day I closed the course, I immediately doubled the price, and I’ve never lowered it since.
People were getting great results with Earn1K, so I knew I was onto something.
Here’s what you learn by moving 100x up the value chain:
- The more you demand of your clients, the more they achieve. Turns out, people don’t just want the easy way out. Interesting…
- Some of the things you think are critical — like the visual look of your backgrounds — don’t matter as much as you think.
- But you’d better be BULLETPROOF on the things that do matter, like the quality of your material.
- You start to see glimmers of light that this could grow and scale.
If you simply look at my $600,000 launch, it could feel overwhelming. But now you know the background of what it took to get there. Baby steps, lots of mistakes, and a homeless dude on 9th Street.
Remember: Having Your Own Business is Fun!
Once you crack the code of online business, you can take what you love, bottle it up, and share it with the world — automatically — for years to come.
This isn’t drudgery. Imagine a life built around doing what you love.
There’s no substitute for the joy of sharing your passions with the world.
Or for the praise you hear on a daily basis:
“Your work so tangibly and obviously provided me so much more value than what I paid. To anyone who is hesitating before clicking buy on one of your products I feel like shouting ‘DO IT, DO IT NOW, C’MON, BUY IT NOW!'”
– Lawrence Lee
“I just wanted to say a big THANK YOU to you for the amazing material you’ve provided… The new perspective on life I’ve gained has been invaluable, and I’m definitely going to continue being a life-long student of yours.”
– Mihir
“Just wanted you to know that since I bought my first course through your site I went from a $78k job to a truly amazing $110k… Your material really has helped me more than any other thing. I can’t thank you enough! I will definitely be purchasing another product in the near future.”
– Danny
My goal in life is not to take a vacation. It’s to make an impact.
Success Story: Bushra Azhar
The working mom in Saudi Arabia who went from “no idea” to $130,000 in a single month.
If they can do it, so can you!
You can have your own success story, just like some of my other students:
It doesn’t matter who you are, where you live, or what industry you decide to work in. You can have your own successful online business.
Click here for 10 Profitable Business Venture Ideas (real examples + how to get started)
How to Start a High Profit, Low-Cost Online Business
Starting an online business is incredibly simple. All you need is a laptop and these key ingredients to make your first sale:
All You Need to Start an Online Business
But before you get there, you’ve got to decide what type of online business you even want.
There are 6 major online business models the average person can use. Some give you huge profit margins, take minimal time, and scale easily. Others require a lot of time, overhead costs, and are difficult to grow.
I’ve tested them all, so let’s walk through them real quick. Then you can decide which model is right for you.
Business Model 1 - Advertising
The most common business model is ads. Almost all of us have seen these. They’re little advertisements — usually Google AdSense — on the sidebars of a website.
Here’s how they work: As you get traffic, some people will click those ads. When they do, you get a few cents, or even a few dollars per click.
I tried this for IWillTeachYouToBeRich.com. But I quickly realized ads don’t make that much money. In fact, what I learned was that you need a huge amount of visitors, like 50 million visitors — or more — per month, to make a good income from ads. That’s a lot of traffic.
Back when I started in 2004, I decided, “If I can’t cover my rent with ads, why bother?” They’re ugly and distracting. Plus, I’ll end up spending more time optimizing the click-through rate on the ads than actually writing great content. So after trying that experiment for a little while, I checked the box and said I’m not interested in that business model.
Business Model 2 - Software
If you have the skills to create new software, then this can be a tempting option. The media loves to tell us stories about hot new Silicon Valley startups and the founders of tech companies who cashed out for millions after their company went public. So we think starting an online business means doing something similar.
And yes, you could quit your job, seek venture funding, and spend the next few years trying to build the next Instagram.
But let’s face it, for most of us, this isn’t a viable option. We’re not programmers. We can’t code. And we’d rather stab ourselves with an ice pick than try to learn any of that technical stuff (at least I would).
And even if you can code, do you really want to deal with the never ending challenge of patching and upgrading your app?
Luckily, there are other options out there. You don’t need to create the next Candy Crush to have a successful online business. You don’t even need any technical or computer skills for the other online business models I’m about to show you.
Success story: Tom Miller
The tutor who made enough with his online business to quit his full-time engineering job — and now has more time to spend with his family.
Business Model 3 - Sell Physical Products
I’m wary of this business model because the profit margins are terrifyingly low.
Just to give you an example, we have a notepad that our designers created internally for IWT staff. We would have had to price it at around $50 — for a teeny little notepad — just to break even if we wanted to sell it. And after we shipped it to people, our profit margin would have disappeared.
I know there’s some money to be made in this space. But I prefer the profit margins offered by online products.
With online products, the profit margin is higher, and it’s much easier to scale. Physical products just introduce so many variables and costs that I’m not interested in them.
Business Model 4 - Affiliates
Here’s an example of how affiliates work: A blogger will write a review of “My favorite credit cards,” and at the bottom they’ll say, “You can sign up for the card here — NOTE: this is an affiliate link.”
If you click that link and sign up, the credit card company is going to pay that blogger an affiliate commission. Sometimes it’ll be $50 or $75.
Over time, that can actually add up to a lot of money. And there are affiliate programs for everything — from audio books to weight loss products.
For a long time, I avoided affiliates because I didn’t want people to think I was recommending stuff just to make money. I only wanted to recommend the best products.
But eventually I realized that my readers trusted me, they were already going to sign up for the accounts I was recommending anyways. So I decided to try putting an affiliate link in with one of my recommendations.
When I did — virtually overnight — I became ING Direct’s number one affiliate in the world. I was making more than $10,000 a month — just by putting a link on my site.
But I soon learned this wasn’t a great long-term plan. My click-through rates tailed off and I ended up having to spend all this time dealing with advertisers.
In the end, I realized it wasn’t worth the time, so I stopped.
Take the skills and experience you have inside you and package it into something that the world will pay for.
Business Model 5 - Online Information Products
Now, my favorite business model: Selling something you create. Typically, these are information products, like a video course.
You can create a video or written course that sells for $49 fairly quickly. But more expensive, high-end ones take a lot longer. For example, when we built Dream Job, we spent months on research, outlines, testing, creation, and design.
Online courses are low-risk, high-reward, and scale very well. You can use them to reach thousands of people all over the world. It’s become the crux of our business and now we generate over 95% of our revenue through our own products. I can’t recommend it enough.
Business Model 6 - Coaching
One of the fastest ways to start earning money from your online business is to offer coaching.
This comes as a surprise to a lot of my students. They join my program looking to create an online information product. But as they build their email list, people message them saying: “Hey, I love what you do. Do you offer coaching?”
There are a few great reasons to take them up on this offer:
- You can charge premium prices for one-on-one work or group masterminds
- You’re basically getting paid to do customer research. With coaching, you’ll learn their deep fears, desires, and barriers — information you can use to create an online product that thousands can use
- It’s a chance to get great testimonials to sell more coaching/other courses.
You don’t have to build anything or have a big audience to get started with coaching, and you can earn money quickly, while online courses let you earn revenue automatically and impact a broad audience.
If you can’t choose, do both.
Here’s something that will help. Click this link to learn how to get your first coaching clients — even if you’re in a brand new industry.
How to get your first coaching clients (even if you’re new to the industry)
Success Mindset: How to Become the Type of Person Who Makes 6-figures Online
You don’t need a ton of time to create an online business. You don’t need a Harvard MBA or some other fancy piece of paper. You just need a computer, an idea, and to overcome these 3 common fears:
“Why would anyone pay me? I’m no expert.”
“But I’m too busy.”
“But I don’t have an idea.”
In this section, we’re going to dismantle all three of those seemingly massive barriers, one by one.
Fear #1: “Why Would Anyone Pay Me? I’m No Expert.”
So many of us waste our time chasing mythical credentials. We wait for the right day when we suddenly have a certificate from some random organization giving us permission to go out in the world and do what we’re here to do.
And then what? Suddenly we find that degree didn’t open doors or bring in clients the way we thought it would. Now what are we supposed to do?
Let me be blunt:
I’m not a Certified Financial Planner, but because of my online business, I’ve helped more people with their money than most CFPs ever will.
I’m not a “certified career counselor,” but I’ve helped more people find Dream Jobs and negotiate their salaries than almost any of them will.
YOU DON’T HAVE TO WAIT FOR PERMISSION.
We don’t have to wait for gatekeepers to recognize us anymore! This old idea of laboring for 30 years, waiting for some fancy Manhattan TV producer or agent to call us, and then “we’ll be successful” is archaic and wrong.
Stop waiting for someone to knight you. It doesn’t matter if you’re the world’s top expert. You just have to know more than the people you’re helping. If you can help them get results, they’ll happily pay you — and even recommend you to their friends.
Fear #2: “But I Don’t Have Time.”
If you work full time, have kids, or simply like having a vibrant social life, it might seem impossible that you could ever have time to start an online business. You’re overextended as it is!
I’ve worked with tens of thousands of people to start their businesses.
I’m talking about paying students who take this very seriously, not looky-loos.
And along the way, I realized one of the most important determinants of success is:
Will you put 5 hours/week into your calendar?
When people say, “I don’t have time to start a business,” they’re not thinking of some smoothly organized calendar system.
They’re thinking about the vague plans with friends sometime this weekend. About how they have to clean the garage. And about how they have that pile of papers in the living room they’ve been promising to clean up for 3 months.
Getting started is more important than becoming an expert.
I get it. But until you can step out of the day-to-day and take control of your time, you’ll always be reacting to the rest of the world’s demands on your time.
In other words, you could go another 3 years responding to emails, organizing piles of papers, and cleaning your garage…and still be treading water.
Or you can decide to start at the calendar level and carve out 5 hours/week — just five — to work on something life-changing, like starting a business.
Maybe you don’t even have a calendar. That’s fine — no judgment. But I discovered that once I put something on my calendar, it was “my time” and I protected it.
You know why I decided to start keeping a calendar? Because I was tired of responding to the rest of the world’s demands without making time for my own.
I know this is a simple suggestion — “add it to your calendar” — but it’s profoundly impactful if you actually do it and stick to it.
When you take control of your time, it’s a total game-changer. No more sighing. No more piles of “stuff” you promised to do.
Besides, with an online business, you don’t have to be there constantly working on it. You can set it up once, automate it, then get paid automatically — while you do something else.
Fear #3: “But I Don’t Have an Idea.”
We all have something special that we’re unusually good at. If you and I talked for 20 minutes, I know I could find something you’re good at. Maybe you can teach dogs to do tricks. Maybe you’re a great decorator. Or maybe your friends always ask you to fix their computers.
When you say, “I don’t have an idea,” that’s really code for, “I’m waiting for a magical idea to fall down from the sky.”
Ideas are rarely found by thinking. They’re found by doing.
News flash: THAT WILL NEVER HAPPEN! Ideas don’t happen to you, you find them! I didn’t come up with the idea of I Will Teach You To Be Rich one night, staring out at the beach through a rain-drenched window.
And really, is the idea of a personal finance site really that compelling? (I’ll answer my own question: No!)
Success almost never comes from a mind-blowing idea. Success comes from a basic idea executed amazingly well.
Finding Your Successful Online Business Idea
If you Googled “business ideas” right now, you’d see thousands of ideas to choose from:
So that raises the question: If business ideas are so easy to come by, why is finding the right one so hard?
Answer: Because you don’t just need any old idea. You need to know if your idea:
- Is profitable (so you don’t waste your time)
- Is something you’re passionate about
Anybody can hand you a list of ideas and say, “Run with this. Bye.”
But our approach is decidedly different. We’ve developed a system that guarantees you’ll find a profitable business idea doing what you love.
I want to share that system with you today. And at the end of this section, I’ll give you a checklist you can use to quickly tell which of your business ideas are profitable.
Let’s get started.
Step 1: Start With Business Ideas That Suck
Here’s the most liberating part of coming up with business ideas: You have permission to suck.
There are no bad ideas, especially in the beginning.
Some of my early business ideas were terrible. And I’ve created more than 19 successful products.
Losers wait for the perfect idea to fall from the sky. Winners start somewhere, then improve the idea bit by bit.
For example, a few years back, I was certain my readers wanted a product on healthcare. After all, I’m an educated guy and I had trouble figuring out what health insurance to use!
We spent over $50,000 building a product, beta testing it with students, even writing copy for a launch.
But after all that testing, we realized that nobody cared. We learned that while people love to complain about healthcare, few want to do anything about it.
This taught us a very expensive lesson: Test your idea BEFORE you create a product, and you virtually guarantee it will be profitable.
Since then, we’ve developed a system to help you quickly identify bad ideas so you can avoid some of the costly mistakes that we’ve made.
It all starts with this simple realization: You have permission to come up with ideas that suck.
Got it?
Once you’ve internalized this idea, you’re ready to move on to step two.
Step 2: Ask Yourself These 4 Questions
It’s relatively easy to sit and come up with a list of random ideas. But without the right framework, you can’t tell if these ideas will ever hold any weight.
That’s why we use this simple exercise to get the ball rolling. The first part of this exercise is to ask yourself 4 questions.
Question #1: What do I already pay for?
I lead with this question because a lot of us can’t even fathom the idea that someone would pay them for something.
But when you think about it, we already pay other people for tons of random stuf
For example, maybe you pay someone to:
When you start to make your list, you’ll quickly see that you pay other people every day.
That’s why I start with this question. It opens your mind to what’s possible.
So take a second — right now — and think of about 3-5 things that you already pay for. Write them down on a sheet of paper and move on to the next question.
Question #2: What Skills Do I Have?
What are you great at? Write those things down.
Remember, there are no bad ideas here. Your list of skills can include anything you want.
- Are you good at cooking?
- Do you speak Spanish?
- Are you an Excel wiz?
As you make your list, you’ll start to see what people might pay you for
Success story: Nagina Abdullah
The busy working mother who was afraid to sell — and went on to make over $10k/ month helping women lose weight.
You have passions and experiences in you that people will pay for. What’s simple to you is a big pain in the ass for someone else.
If you’re great at cooking, maybe you could be somebody’s personal chef. If you know Spanish, you could become a tutor. If you’re amazing at Excel, I know plenty of people who would gladly pay you to create some charts for them — right now.
I want you to push yourself to come up with a list of at least 10 skills you already have. Write down anything that comes to mind. Don’t filter any of your ideas.
Once you’ve got at least 10, you can move on to the next question.
Question #3: What Do My Friends Say I’m Great At?
This is important to think about because it can be very revealing. Maybe your friends are always saying, “Wow, you give amazing relationship advice. You’re the only person I come to.” Or, “Your apartment is so organized. I wish my place looked like this.” Or, “OMG, you’re always wearing the perfect outfit! I’m so jealous.”
You could turn all three of those things into successful businesses.
Sometimes it’s easy to forget we have these skills because they come naturally.
That’s why I include this step.
If you find yourself thinking, “Ramit, I do not have any skills,” go ask your friends. It might seem a little weird, but I bet they’ll give you a list of at least 3 things you’re amazing at — right away.
Add these ideas to your list. Shoot for at least 3-5 ideas and feel free to ask a couple of different people if you want.
Trust me: There are things you’re great at that you probably don’t even recognize.
Question #4: What Do I Do on Saturday Morning?
This last question comes from one of my good friends, Ben Casnocha.
He said, “When you’re trying to find a business idea, think about what you do on a Saturday morning before everyone else is awake.”
What are you reading? Fashion magazines? Fitness books? What are you watching? What one thing could you do all day?
Another way to think of this is: If you were locked in a room with your friend, what could you talk about for 3 hours straight?
This is a great way to expose ideas and passions. The things you would have a blast sharing with the world.
Writing these ideas down can go a long way toward helping you find a successful business idea.
By the end of these 4 questions, you should have at least 20 ideas written down. If you don’t have 20, go back and try asking yourself each question again until you do.
Once you get to 20, you’re ready for step 3.
Use the Demand Matrix to Guarantee People Will Pay You
A lot of people will just leave you there and say, “Make a list. Have fun!”
But I want to take it one step further. In our courses, we always test our ideas for profitability.
That way, we can virtually guarantee they’ll be successful.
And for that, I want to show you a tool we use called the “Demand Matrix.” Here’s what it looks like:
The Demand Matrix is a very simple way to take your 20 ideas from Step 2 and figure out which of them are worth your time.
Before we get to that, I want to explain how this chart works.
High End
Starting in the upper left-hand corner, you’ve got High End. Ideas that fall under this section are a great business option because you can charge a high price, but you’ll likely have relatively few customers. Think about companies like Rolls-Royce and Prada. They charge a very high price but have relatively few customers.
Your Golden Goose
In the upper right-hand corner of the chart, you’ve got Golden Goose. Ideas in this section make great businesses. That’s because these ideas have the potential to get a lot of customers and command a high price. Think of companies like P90x and Apple’s iPhone — lots of customers, pretty high price.
Mass Market
In the bottom right-hand corner, you’ll see Mass Market. Under mass market, you can still get a lot of customers, but you’ll only be able to charge a low price. Think of famous books you might read, like “The 4-Hour Workweek.” There are a lot of customers, but the price point is pretty low.
Labor of Love
In the bottom left-hand corner, you’ve got a Labor of Love. These are business ideas that have few potential customers and can only charge a very low price. Any business idea that falls in this category is doomed to fail — before it even starts. This is your weekend hobby that nobody would pay for.
Find Your Business Idea (in 2 short steps)
Step 1: Brainstorm Session
Take 20 minutes to brainstorm at least 15 business ideas. Answer these questions to come up with ideas:
- What have I paid for in the past?
- What skills do I have?
- What do my friends say I’m great at?
- What do I do on Saturday mornings?
- How do I spend my free time?
Step 2: Plot Your Ideas on the Demand Matrix
The ideas that fall under the “Golden Goose” section will be the most profitable for you. (If you’re not sure exactly where an idea goes, make an educated guess.)
High End
This would be my 6-Figure Consulting System course. Since this course helps already successful business owners make more money, it has relatively few customers, but it can command a much higher price. Successful business owners are willing to pay a premium price to grow their sales.
Golden Goose
Our Find Your Dream Job course fits here. This is a program where I show people how to find a job they love. Obviously, the market for this is huge because 90+% of us have jobs. And because finding a Dream Job is something people really want, we can charge a relatively high price for the program.
Mass Market
This is where my book, “I Will Teach You To Be Rich,” falls. Books are great Mass Market products because lots of people buy them, but the price is relatively low.
Labor of Love
This is where we put all of our business ideas that will probably never see the light of day. Some examples might include an ironing course or a class where I teach people about spicy foods. Yes, those might be things that I love and am great at doing, but there’s not a big market for those. And any market where there are people, those people would not really pay.
See how it works?
It’s a great way to test your ideas for (1) profitability and (2) demand.
It’s not meant to be super scientific. It’s just a back-of-the-napkin way to find out if an idea has a chance of being profitable.
There are no right or wrong answers. To test for demand, just ask yourself, “Do a lot of people care about this?” If the answer is yes, then ask yourself, “Are people willing to pay a lot to solve this problem?” to figure out the price.
Quickly you’ll see where your different ideas fall on the chart.
It’s pretty simple, but I want to make sure you go through each step thoroughly. Getting this right up front can save you thousands of hours over the long run.
Simple Tech Tools to Earn Your First $10,000 Online
Some people only focus on the COST. Others focus on VALUE.
If you’re not “tech-savvy,” then you are going to love this section.
You’re about to get a step-by-step breakdown of exactly what to do and where to go to get your first website up and running. Then, you’ll get the list of technology tools and resources I used to turn a blog that sold nothing into a multimillion-dollar business.
This guide will save you a ton of time down the road. And show you how simple and easy building an online business can be.
Before I give you my recommendations, though, keep two things in mind:
- Don’t nickel-and-dime with service providers. Pay for the right service and move on so you can spend your energy on growing your business.
- Reliability is priceless. Cheaper services might save you $10 per month — until you really need them. Imagine after months of work, you finally score a guest post on Huffington Post, get a ton of traffic to your website, and then your site crashes. Those few bucks just cost you hundreds of subscribers and thousands of dollars in revenue. Pay a little extra and sleep well at night.
Create Your Website in 4 Easy Steps
Step 1: Your Domain
The first thing you need is your web domain, or URL. If you don’t have one yet, I recommend picking something simple and straightforward. Don’t make the mistake I made and create the scammiest sounding website ever: iwillteachyoutoberich.com
Here are some good examples to get your brain thinking:
To see if the domain you want is available and to purchase it, I recommend going to Hover.com.
Step 2: Web Hosting: WP Engine
Next, you’ll need to set up your web host for your website.
One popular hosting option is HostGator, though you can often get hosting through whatever site-build you use. For example, I recommend WP Engine for students building their site through WordPress (we’ll cover what site-builders to use later).
Since you’re just starting, you can go with low-cost options. For example, if you’re using WP Engine, then sign up for the Personal option. As your business grows and you get more traffic, you can upgrade to a higher level.
NOTE: Once you have a domain and host, you’ll need to connect the two so your domain points to your site. I won’t go into detail on that here, but if you get stuck, know that companies like Hover and WP Engine have excellent customer support and can help you.
Step 3: Build Your Website
Now that you have a place for your site to live online, it’s time to actually build it. I’ll break down some of the top site-builders to use shortly. But I recommend WordPress for most people. It’s what I use and fantastic if you plan to blog regularly.
Step 4: Web Design
Don’t worry, you don’t need to spend $3,000 on web design when you’re just starting. You can get some beautiful, professional-looking templates that do the job fine for much cheaper.
The free themes you see on a site like WordPress don’t look great. But for a little bit of money you can get a clean, professional look. One theme I recommend is Genesis at Studiopress.com.
The Technology Toolbox
I’ve created a comprehensive list of all the tools you’ll need to run an online business. Click here to get it.
Top 5 Website - Builders for Beautiful Sites on a Budget
While I recommend WordPress for most people, the fact is that may not be the best choice for everyone. For example, if your goal is to sell physical products online, you may prefer Shopify.
Below is a more detailed breakdown of the options available to you.
WordPress.org is the most popular website-builder on Earth. It’s the engine behind everything from the New York Times, which gets millions of visitors every month, to tiny personal blogs, which barely get any traffic. (In fact, 48% of Technorati’s Top 100 blogs are managed with WordPress.)
(But before I explain it further, I want to make an important distinction: there’s WordPress. com and WordPress.org, and they are NOT the same thing. WordPress.com is a blogging platform that requires no software installations or downloads; just sign up and start using it. WordPress.ORG, however, is blogging software that must be installed on a web server, but allows full customization. For more information on the differences, check out this guide.)
Squarespace offers a host of elegant themes and allows users to build crisp, modern designs into their websites. It’s perfect for any online business that centers around image-driven content (such as food blogs and fitness).
Shopify is an awesome e-commerce platform for an online business’s storefront. Hundreds of thousands of merchants use this software as a way to grow their businesses and customer bases.
With over 63 million registered users, Wix is one of the largest website-building platforms in the world. It offers one of the best drag-and-drop builders available. This is great for anyone who hates fumbling with codes and finding plugins.
Weebly: Affordable and Easy to Set up
With over 30 million users worldwide, Weebly focuses on providing an intuitive sitebuilding software with a variety of free services.
Weebly is a great option for beginners who want to create a website for their online business as fast as possible. It’s easy to customize WITHOUT spending a lot of money as well.
Which One is Right for You?
OK, let’s do a quick recap to decide which website builder is right for you.
WordPress
Excellent option for bloggers and people looking to grow their business because of the fantastic features and the flexibility of the platform — you can customize it so many ways and even turn your site into a solid e-commerce destination with plugins such as WooCommerce.
Squarespace
Perfect for online businesses who rely on imagery – graphic artists, photographers, culinary experts, etc. — because of the modern style. Designed to showcase your products and services. Also, because of the drag-and-drop editor, it’s a great solution for creative types who want to avoid hassling with coding or customizations.
Shopify
The top solution for online stores because of their robust platform that handles every facet of e-commerce: You’ll have control over invoices, coupon codes, inventory, and customer interactions at your fingertips.
Wix
Great choice for the novice who wants to quickly create a website and doesn’t want to worry about future modifications. Their drag-and-drop site-building platform is superior to even Weebly, which makes the design process very intuitive. Once you make it, however, you’re stuck.
Weebly
Great option for the beginner who wants to create a website for their online business as fast as possible and wants flexibility in the future for customizations WITHOUT spending a lot of money.
Next Steps: From Zero to Launch
You’ve learned some of the key tools, mindsets, and strategies you need to create your own online business.
In Part 1 – We looked at the dark side of online business and learned how to avoid Marketing Tactical Hell.
In Part 2 – I showed you how scaling can take you from $0 to $100,000/year with your online business. Remember, it’s not magic, it’s math.
In Part 3 – We walked through 6 major online business models so you could see which model is right for you.
In Part 4 – We talked about the success mindsets of successful entrepreneurs and dismantled the three most common fears to starting a business.
In Part 5 – You learned how to plot your business ideas on the Demand Matrix to help you find your Golden Goose.
In Part 6 – We looked through the Technology Toolbox to identify the best tools to build your online business so you can get started right away.
Finally, you read the stories of my students who started from zero and created a successful online business that lets them live life on their own terms.
I hope this guide inspires you to get started creating your own online business. Whether you want a business that makes an extra $1,000/month, or $10,000/month so you can leave your full-time job and work from anywhere, you can do it.
And that means learning how to:
- Stand out from the competition (and make more sales even though you charge more)
- Create high-quality products that can help thousands around the world (from $49 eBooks to $20,000 masterminds)
- Grow your email list and create a sales machine sells for you 24/7
John Corcoran – “I’ve quadrupled my email list (to 25,000) and made well over $200,00 this year.“
I give away tons of free material about these topics. I even have a full course that takes you step-by-step from “no idea” to a successful online business.
Earnable is the ONLY online business program proven over 15 years, 50+ industries, and 42,000+ paying customers that covers the ENTIRE process of starting and growing your business.
You get access to all the exact strategies, frameworks, hands-on tactics, real-world examples, mindsets, done-for-you templates, word-for-word scripts, and hard-won breakthroughs you need to be successful. Join today and make your Rich Life a reality.
…but you don’t have to take the same path as everyone else. How would it look if you designed a Rich Life on your own terms? Take our quiz and find out:
