If you’re new to the world of business and wondering what type of venture to start it can feel overwhelming. With so much advice out there how do you know where to begin? Many people talk about passive income ideas like e-commerce, dropshipping or selling digital products. Here’s the harsh truth these aren’t always the best options for beginners.
Starting a business takes effort and as a beginner you want something that is simple, low risk and doesn’t require a lot of money upfront. This article breaks down the Best & Worst Online Businesses to Start. We have grouped the different types of businesses into 3.
1. Product Based Businesses
These are businesses where you sell either physical or digital products such as puzzles, clothing or online courses via online stores, dropshipping or Print-On-Demand
Physical Products (D-Tier)
This entails selling items such as furniture, jewelry or gadgets. This includes dropshipping, ecommerce, online store and print on demand.
Pros
- You can build a recognizable brand and potentially earn a lot of money if the business succeeds.
- Big financial opportunity if done correctly.
- Freedom to do whatever you want.
- Very scalable.
- Results detached from your time.
Cons
- Requires high knowledge of traffic plus marketing and requires Money, Experience and Time to build an audience.
- Requires high knowledge of products or resources to figure out aspects like validation, packaging, messaging, pricing and logistics.
- High risk depending on your experience.
- Tons of upfront work required before seeing a profit.
- Requires initial startup investment.
- Can take months or years to become profitable.
- Lower profit margins.
Digital Products (C-Tier)
You can sell templates, e-books, courses, newsletters, tools or printable planners online.
Pros
- They are cheaper and easier to create than physical products.
- You don’t have to worry about shipping and they can be very profitable if you find the right audience.
- Very scalable.
- Great profit margins
- Many specific niches you can target
- Can be semi passive
Cons
- Because it’s easy to start many people are already doing this. The competition is high so you’ll need to stand out.
- Building an audience can also take time.
- Requires high knowledge of product
- High risk depending on the level of experience
- Can take months to start making money
2. Content Based Businesses
This type of business involves creating content to earn money such as starting a YouTube channel, influencing, writing a blog or hosting a podcast. We would advice beginners to do this as a side hustle before you build a good audience.
You can make videos on YouTube about cooking or blogging about travel.
Pros
- You can earn money in different ways through ads, sponsorships, digital and physical products or paid memberships. It’s also a great way to build an audience and become an expert in a field.
- Multiple income streams
- You can build a community of like minded people
- Fun, fame and fortune
Cons
- It takes time to grow your audience and you need to consistently create free content before you see any income.
- It is extremely competitive
3. Service Based Businesses
A service based business is when you offer your skills or time to help others. This is one of the best ways for beginners to start because it’s simple and doesn’t cost much.
Junior Freelancing (S-Tier)
This entails helping people design social media posts, manage emails or organize projects. You dont need alot of experience to start
Pros
- You don’t need to be an expert to start. Many businesses look for affordable help with simple tasks
- You can learn on the job as you get paid.
- It’s cheap to start since you’re just offering your time and effort.
Cons
- You’ll need to put in the hours to earn money
- It can feel like a regular job at times.
- Lots of time is used for pitching to clients in the beginning.
- You will take alot of time learning new skills
Mid-to-Senior Freelancing (A-Tier)
This entails becoming a graphic designer, web designer, agency founder, video editor, copywriter or virtual assistant.
Pros
- Once you’ve gained some experience you can charge higher rates. These skills are in demand and clients will pay well for quality work.
- Freedom to choose projects that interest you.
- Good income
- Its flexible
Cons
- It might take time to develop advanced skills and earn a decent income
- You’ll need to market yourself to find clients.
Tiered ranking system for starting a business for beginners
| S – Junior Freelancing | Community Assistant TT/IG Assistant (TikTok/Instagram Assistant) YT Assistant (YouTube Assistant) Tech Assistant |
| A – Mid/Senior Freelancing + Agency | Agency Founder Graphic Designer Video Editor Copywriter Strategist Website Developer Digital Business Manager |
| B – Content-Based Biz | YouTuber Influencer Podcaster Blogger Streamer |
| C – Digital Product Biz | Templates Printables Tools Paid Newsletter Workshops, Trainings, Courses Digital Events & Summits Paid Community/Membership |
| D – Physical Product Biz | Dropshipping Ecommerce Online Store Print-on-Demand |
Which Business Should You Start?
If you’re just starting service based businesses are your best bet. They’re simple, affordable and will teach you valuable skills you can use later if you want to grow or pivot to a different type of business.
Content based businesses are great if you’re passionate about sharing knowledge or building an online presence but they take longer to see results. Product based businesses while profitable for experienced entrepreneurs are usually too risky and expensive for beginners.
