Starting a business is hard. When you’re working for yourself, you have to manage the planning, the pitching, the promotion, the rejection, and the actual logistics of running a real business. And after that, you still have to make a profit!
If you’re reading this, you’ve probably decided that the benefits of working for yourself outweigh the risk—and risk can be motivating! But before you dive headfirst into online business, you need a good idea.
Not just an idea that makes sense in the market—an idea that takes advantage of your unique skills and gets you excited about working on it, because you’re going to be working on it a lot.
Three years ago, I started my first business, a company that let people “send handwritten cards from the comfort of their keyboard,” and earlier this year I launched my second one, an on-demand mentorship platform for aspiring entrepreneurs, coders, and creatives.
Coming from a business and consulting background with no real coding or design skills, when I first got started, I had trouble figuring out what sort of online business I could actually start on my own. What was I qualified to build my brand and business around? What niche made sense?
To help you come up with a valid business idea and choose your niche, I chatted with business coach Claudia Mayer, who runs Coaching by Claudia. Together, we honed in on a few simple exercises that can help you choose a niche and craft your brand based on your strengths.
If you’re curious about how to launch your own course, check out this guide, How to Teach Online in 2017. You don’t have to recreate the wheel or start from scratch. See what strategies 100,000+ online schools are using to run an online business.
Step 1: Review your skills and strengths
The first piece of the puzzle is pretty simple—figuring out your strengths and detailing the ways you’ve been most helpful to others over the course of your career.
For this section, take out a pen and piece of paper and jot down a list for each of the following categories.
(After that, we’ll review the list, asking a few high-level questions that should help you pull out the things that are your most unique core competencies.)
- Every industry you’ve worked in as well as the jobs or roles you’ve had for the past decade.
- The main roles and responsibilities you’ve had in these jobs. What did you spend the most time doing?
- The primary hard skills you’ve built up throughout your career. What are you an indisputable expert in? This could be software like Photoshop or Excel, or more conceptual fields like Business Strategy or User Experience
- The types of customers you’ve helped throughout your career. Did you primarily help businesses or individuals?
- The primary benefits that you’ve delivered to these customers. What was the main deliverable your customers or clients walked away with at the end of the day?
- What successes have you had? Be specific -- state relevant tangible numbers. What are your success stories? What were your main clients’ position before working with you and how was their situation improved after working with you?
From this list, you should be able to see common threads and start narrowing your experience into a short list of the things that you not only love doing but are also the best at.
From there, Claudia suggests going one step deeper: “In my group workshops I go one step beyond this question by asking participants about one or two ‘peak experiences’—which are moments in their (professional or private) life where they felt very proud as a result of their achievement.”
Now that you have a condensed list of your strengths and past client successes, we can start talking about how to match your strengths to your life goals. This will help you double down on a niche you’ll be excited about in the long run!
Step 2: Clarify a few overall life goals and ambitions
There are many types of businesses, and your personal life goals will dictate the type of business you decide to start. Are you interested in creating a passive revenue stream so you can spend more time with your family, or do you just want to be independent, regardless of what form that takes?
The goals driving your decision should be front and center as you brainstorm business ideas and business models. Once you clarify how you want to work, figuring out the type of business you want to start will be much easier.
First, get away from distractions for a few minutes and imagine your ideal life situation. What do you value most? What is most important to you? A few guiding questions:
- How much time do you want to spend with your family or partner, with friends or on hobbies ?
- What role does money play in your life? What is your estimated net income you’d need to achieve your ideal lifestyle? (It doesn’t have to be 6 or 7 figures!)
- Do you want to work alone or start collaborating with other professionals who have complementary skills and/or networks?
- Do you like working on projects that require you to constantly work with clients or would you prefer to create your own product that you can sell from home, without having to worry about client deadlines or deliverables.
For reference, let’s look at Pieter Moorman, the founder of Growthcasts, a series of online marketing courses and resources. Pieter knew that he wanted to work independently and on his own schedule (he currently lives in Bali). He therefore built a business that generates a passive income stream so he can work just a few months a year and spend the rest of his time traveling and working on other personal projects that bring him happiness.
Step 3: Pinpoint where your skills, life goals, and passions intersect
Now that you’ve mapped out your skills and some life ambitions, it’s time for the final piece of the puzzle: figuring out what you’re passionate about! And if you’re not sure what you’re passionate about, don’t worry. Instead, think about what things make you curious to learn more.
This could intersect with your previous work experience, but it could also look like a complete departure. Write down a list of 10 things that fill you with excitement or get you itching to ask more questions. These could be industries (virtual reality, social impact work, etc.), skills (teaching others, helping businesses become successful, etc.), or anything else in between.
Claudia uses the Japanese concept called ‘Ikigai’ when chatting with future business owners. Ikigai refers to your “reason for being” and falls at the intersection of your passion, your mission, your profession, and your vocation.
You’ve probably heard the phrase “do something you love and the money will follow”, and there’s a reason for that. People who focus on things they’re passionate about (especially when they combine that with their professional skillsets) never “work” a day in their lives. Adding market need and purchase power into the equation (we’ll cover that later on in Step 6) will help you focus on building a business with the necessary income streams, instead of framing it as a hobby-like side hustle.
If you’ve been following along, you should have a substantial list of your skillsets, your values, and your passions. From there, a few possible business ideas may be emerging. If not, don’t worry—the next few sections should be enough to get you churning out ideas!
Step 4: Identify your niche and your ideal client
Before we jump into the actual type of business you should start (service-based, digital product, etc.), let’s spend a moment mapping out your ideal client as well as what unique value you can provide to them that nobody else can.
Note: for a more detailed look at what it means to identify your ideal client, check out these posts:
Claudia has a fantastic 5 question process she uses to help businesses figure out who their client is and why that client should work with them…
- What is your ideal client profile?
- Who do you love to work with? Businesses? Individuals? Agencies? Startups? Decide on a specific niche of businesses and focus your strategy around appealing to that specific type of customer. You can always expand later, but focusing around the needs of one specific persona is the best way to get started and build a business that a niche group of customers love
- What makes your ideal client unique?
- What are their goals and ambitious? Their hopes and aspirations? Their challenges and worries? Their problems and needs? Talk to one of your old clients and hear about their specific needs!
- Why do they buy?
- To relieve a pain point? To learn something new? Just for the fun of it?
- For which needs do you have the ideal solution?
- This is where you can pair your specific skillsets with the specific needs and pain points of your customers
- What results do your clients get from you?
- This relates to the benefits and success stories we spoke about in the first paragraph.
Nathan Lively is a Teachable instructor and the founder of Sound Design Live, a business that helps people succeed in the audio industry. Nathan spent over a decade in the audio engineering field before deciding to start his own venture. Looking at his skills and the major problems he had worked hard to overcome throughout his career, he realized he could deliver significant value by focusing specifically on people trying to build careers in the audio industry (a field in which he had deep expertise). By helping people in a niche that he himself had years of experience in, he was able to build a clear client profile and solve for a very specific need.After identifying your ideal customer and figuring out how you can help them, you’ll be ready to figure out how you actually want to deliver your product or services to customers. More on that next...
Step 5: Choose a business type
Like I mentioned earlier, there are many types of online businesses that you can start, regardless of whether you know a line of code or have spent a minute learning design (although I strongly recommend you learn those things too, since a beautiful site is a great way to stand out—that’s why I launched RookieUp, like I mentioned!).
A few business models:
If your experience or passion lies on the tactical side of things, starting a business where you sell physical products might be right up your alley.
- See what products people create on Etsy and Amazon to get an idea for the huge variety of options in the e-commerce space.
- Similarly, you can attend local handmade markets or events and ask vendors which products are most popular. Events like Renegade Craft Fair are held in various locations in the US and UK and are a great place to start your research.
Digital products (like online courses) are a quickly growing area of the e-commerce world, and for good reason. Once you create them, they continue to earn you income with very little additional effort on your part, and each time someone purchases your product, your production cost will be next to nothing.
- Digital Downloads - If you want to build a business based on your existing industry or professional expertise, you might want to consider creating downloadable products. These come in many forms but here are a few common examples:
- E-books and other downloadable resources and tutorials are a great way to earn income while sharing your professional knowledge. Amazon lets you self-publish books easily and gain access to millions of readers instantly.
- If you have a creative background, you should search marketplaces like Creative Market to see the options available to you if you want to create digital assets that you can sell to other aspiring designers. A few popular products are design textures or packs of Photoshop assets.
- Services - If you enjoy working with clients and want to build an independent career where you sell your time and expertise, you might want to consider a service-based business.
- B2B Consulting services - business consulting, strategy consulting, design consulting, etc.
- B2C Coaching services - life coaching, career coaching, startup coaching, etc.
- Freelance services (doing actual project-based work for clients, like building websites or offering in-person yoga training).
- Online course - you’re reading this post on Teachable’s blog so there’s a good chance you’re well aware of the quickly growing world of online courses.
- Online courses might be perfect for you if you enjoy sharing your knowledge on camera and want to teach others in a more personalized way than selling e-books.
- Successful online courses involve the creation of a series of structured video lessons about a fairly specific topic. As students follow along, they often interact with you and each other via message boards and private Facebook groups.
If you’re considering making an online course part of your business, read this first:How to Teach Online in 2017. See how 100,000+ courses are making money onlines.
Dustin Lee is a designer who founded Retro Supply Co, a business focused on providing resources, textures, and tools for people working in Photoshop and Illustrator. He started the business by finding some mid-20th century packaging in his grandmother’s house, and slowly built the business around the concept of providing beautiful retro-themed Photoshop assets and texture packs for other designers. Inspiration can come from anywhere, so always be on the lookout for ideas for your business.
Step 6: Identify the market demand
By now you should have a great list of potential business concepts you could be starting, as well ideas for the ways you can actually implement those ideas into tangible online businesses. However, you might still be curious whether there’s any demand for your services. You also might not yet be totally convinced that you’ve really nailed down the things about your future business that differentiate you from the rest of the market.
Here are a few more tips for identifying market demand and figuring out what gaps exist in your niche:
- Look at users’ reviews of existing products and courses. See what past customers are complaining about or wishing was featured in that product.
- Use Google’s keyword planner to see the competitiveness of the top products you’re considering focusing on
- Set up Google alerts for relevant keywords to observe the market, learn about competitors and share relevant content with your audience.
- Search for keywords related to your topic to see what your future competitors are promoting most heavily. There’s a good chance they’ve done a lot of the legwork on identifying customer needs and are positioning that front and center in their messaging
- Find relevant Linkedin or Facebook groups (or other online platforms) used by your ideal customers, and see which challenges they face, which questions they ask, which type of content/solutions they look for.
- Attend local business networking events and speak to attendees about their current business challenges stopping them from achieving their goals, their most common objections. What do you offer to help? Research if there is a gap between market needs and your skillset.
Step 7: Craft your unique brand
Now that the hard part is done, we’re ready to move on to something that’s a bit more exciting: creating your unique brand and identity. You should already have a pretty good idea of how you can differentiate yourself from the competition and offer something to clients that nobody else can, but we’ll share a few extra tips just for the heck of it.
Simon Sinek is an author, motivational speaker and marketing consultant who pioneered the well-known “Start with why” concept: ‘People buy not what you do, but why you do it’. Claudia uses this to help every client identify their unique niche. “It helps to differentiate between what someone does (for instance, graphic design and illustration), which is very comparable to others.
The second circle refers to how someone works (work style, approach) which is a bit more specialized (for instance, a graphic designer/illustrator who uses sketching to explain a concept in a visual way).
The third circle refers to why someone works (key values, beliefs, ambitions, motivations) which is unique and helps you connect with people (for instance, the visual concept graphic designer/illustrator who uses humour and jokes to make communication campaigns outstanding and memorable). To learn more, watch Sinek’s renown TED talk How great leaders inspire action.
Once you’ve identified the “why” (which you probably already did earlier in this article), define your engaging pitch. Having an engaging, inviting pitch will help ensure you have clarity of mind whenever you have a conversation with a potential customer. Claudia has a specific formula she uses to help people craft their pitch. Try these two depending on what your offering is:
- “I help/teach ________ (ideal client) to ________ (feature) so they can _________ (benefit).”
- I help ______ (segment) do _______ (benefit), even if _______ (most common objection).
According to Claudia, “this is a continuous process, as engagement with clients in the online and offline world will lead to revisions of this pitch. Early validation with real clients is the proven way to success, yet it’s a trial and error journey. Once you connect and work with your ideal client and get to the point where you’re offering a unique product or service, you will feel the right connection. So, don’t forget to listen to your intuition!”
I hope you’ve got a much more refined idea of the type of business you want to start. Starting my own business has been such a rewarding experience particularly because I spent time thinking about the market demand (a need for flexible online mentorship), my own passions (teaching others and connecting people), and my own life goals (being independent and building a product that’s truly valuable to people).
Tell me what niche you want to get started in below! I’ll answer every comment!
Make sure to get our guide, How to Teach Online in 2017. Get the full report on how to make money as online course creator (and bookmark it for when you need it later).