What Are the Things I Need to Start an Online Business?

By Zoe King

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Last Updated On:

May 3, 2024

If you’re asking: “what are the things I need to start an online business?” then hang on because I’m about to show you everything.

In this guide, I’ll show you:

The blow-by-blow detail of exactly what you need to launch a business online — together with a comprehensive table of the list of requirements
Quick funding sources for starters
How to start an online business on a shoestring with the potential to generate hundreds of thousands of dollars.

What are the things I need to start an online business?

Before we dive deeper into the content, here’s what you need to understand:

The cost of starting an online business may not necessarily be a one-size-fits-all scenario. It may vary for every business based on factors like business model, tools requirements, education, marketing strategy, and so on.

Why? Because all online businesses are not the same.

For some, the startup costs could be so low you’d make jokes with your dog about it. For others, it could be high enough to mess with your life savings.

However, there are certain requirements that are common to all online businesses.

Common Requirements for Starting a Business Online

To answer the question “What are the things I need to start an online business?” here are the common requirements:

1. Business idea

The first thing you need is to answer the question: “What kind of business do I want to build?”

Your business idea is so important. It is the core foundation upon which the whole business is built.

Nail it and you’ll be on your way to building a failproof business. Choose the wrong idea and you’ll be wasting your time and money on a dead-end project.

2. Skill or knowledge

You don’t need a degree to start an online business, but having at least one skill or investing in some form of education is essential for success.

Whether it’s seeking guidance from a coach or mentor, dedicating time to learning from free online resources or enrolling in an online course, the choice is yours.

Additionally, continuous learning is essential for staying up-to-date with industry trends and adapting to the ever-changing digital space.

3. Gadgets and devices

To bring your online business to life, having the right gadgets and devices is crucial.

A computer is the primary tool for most online entrepreneurs. It’s where you’ll manage your website, handle communication, and execute various tasks.

Depending on the nature of your business, you may also need additional gadgets such as a smartphone or a camera.

Investing in the right tools will enhance your productivity and efficiency.

4. Internet access

A stable and reliable internet connection is non-negotiable.

Your business operations, from communication to online transactions, depend on a consistent and fast internet connection.

Invest in a service provider that meets your business needs and provides uninterrupted connectivity.

5. Website (domain name and web hosting)

Every online business needs a website, or at least some form of digital storefront or virtual office for converting interested traffic into buyers.

To build a website, you’ll need a domain name (this is your website’s address, e.g. www.example.com) and web hosting (this is where you store your website’s files and data).

For an unparalleled web hosting experience, Cloudways takes the lead as the most reliable choice, providing cutting-edge, performance-oriented cloud hosting solutions. When building your website, consider using them together with Divi or GeneratePress to make your website stand out.

If you’re exploring alternative options, Kinsta and Scala Hosting also stand out as excellent choices, offering robust solutions for your hosting needs.

6. Professional email address

Having a professional email address is highly recommended for online businesses. Why? Because relying on a free email service like Gmail may not be sufficient. Many contacts and customers tend to view emails from generic or random addresses as less trustworthy, diminishing their credibility.

Ensure your professional email address follows a format like yourname@yourbusiness.com. This not only presents a more polished image but also instills confidence in your communications, fostering a sense of professionalism and reliability.

Cloudways also offers Rackspace Email add-on for reliable, fast, and secure email hosting. With this, you can create professional email addresses easily.

7. Payment gateway

If you’re selling products or services online, you’ll need a payment gateway (or payment processor) so that customers can pay you for your offerings.

This service allows customers to pay via credit cards, debit cards, PayPal, bank transfers, and other acceptable means of payment.

Ensure that your payment gateway complies with industry security standards and protects both your business and your customers’ financial information.

8. Marketing

If you’re going to see results, you need to market your business.

As I usually tell my students, marketing is what stands between the starting point and getting your first paying customer. And you’ll need to do lots of it.

Both organic and paid marketing strategies are important. Organic marketing involves optimizing your website for search engines (SEO) and building relationships through social media engagement. Paid marketing involves running ads on search engines, social media platforms, or other relevant websites.

9. Software and services

Depending on the nature and scope of your online business, you may need to invest in certain software and services to help you get the job done.

Head over to our Tools page to see the software and services that are relevant to your business.

10. Time and patience

Building an online business takes time and patience. It takes time to build an audience, generate traffic, and convert visitors into customers.

You’ll need to put in your time daily or very regularly to see results.

Just like any other business, an online business requires dedication and hard work.

Online Business Requirements Tables

The tables below answer the question: what are the things I need to start an online business?

Shoestring List

The Shoestring List consists of the core requirements for launching a new business online. It’s possible to start making money with just these tools but to expand, you’ll need more.

REQUIREMENT	RECOMMENDATION
Gadgets/devices	List of topnotch laptops on Amazon
Internet access	List of quality internet solutions on Amazon
Domain name (URL for your website)	Namecheap
Web hosting	Cloudways or Kinsta
Professional email address	Cloudways comes with Rackspace email add-on for creating professional email address
CMS/website building platform	WordPress.org
Payment processing	Stripe, PayPal, Payoneer, Verifone, or any relevant one
Online courses and education	SHiFTCADEMY

Bells and Whistles List

Apart from the requirements listed above, there are other tools that you may need based on the “bells and whistles” you want to add to your business or based on the kind of business you’re building.

Thumb through the list, pick what you need based on your business idea, and then do the math for yourself.

REQUIREMENT	RECOMMENDATION
Premium WordPress themes	Divi or GeneratePress
High-converting sales funnels/market, sell, and deliver products and services	ClickFunnels
Email marketing and newsletter	GetResponse or ActiveCampaign or Moosend
Landing page and list building	ClickFunnels or Systeme.io
CRM and marketing/sales automation	ActiveCampaign
SEO and Content	Surfer SEO or Scalenut
Website builder/Web design	Divi or Elementor Pro
Course platform	Podia
Where to learn new skills	SkillShare
Print-on-demand service	Printful (integrates with Shopify)
Hire freelancers and Virtual Assistants	Fiverr
Holding webinars and online classes	Livestorm
Design works	Canva
All-in-one digital marketing	Systeme.io
YouTube SEO	vidIQ or TubeBuddy
Online activities protection and privacy	NordVPN
Password management and protection	LastPass
AI video creation	Synthesia or Invideo
Social media automation	Tailwind
Application and database hosting	DigitalOcean
Subscription billing and recurring billing automation	Pabbly
Repurpose content for multiple social media platforms	Repurpose.io

Funding Your Online Business

Now that you know the things you need to launch and build an online business, it’s time to discuss some easy-to-access funding options for your new web venture.

When it comes to funding your online business, it is not uncommon to consider traditional funding options like:

❌ Bank loans

❌ Association funds

❌ Government programs

❌ Credit cards

❌ Angel investors

❌ Microloans from nonprofits

❌ 401(k) and so on

While these options aren’t necessarily gross, the problem is that they are mostly not designed for the kind of online business you’re looking to start.

They’re designed for larger businesses (with large capital needs).

Compared to traditional businesses, starting an online business does not require a huge capital.

One recent study conducted by California-based Pepperdine University found that only 34% of small businesses received traditional funding through their bank, compared to 75% of larger businesses.

For new businesses, these traditional funding options are not without their limitations:

Almost all the banks will ask for collateral. But most new businesses don’t have hard assets they can pledge to back up a business loan.
Association money will almost always not be a reality without being a long-time member of the group.
Using credit cards for long-term expenditures can be very expensive.
Finding an investor means working your heart out only to share a large part of your earnings with them.
Most wantrepreneurs give up before they even get the money because of the intricacies and lengthy time involved in raising capital this way

In general, traditional funding options could take pretty long to materialize and aren’t designed for a one-man or small online business.

What options are available to you then for starting your online business?

Quick Funding Sources for Your Online Business

When it comes to funding an online business like the one you’re looking to start, I have found that there are a few channels that work best and fast:

✅ Using your personal savings: It’s a no-brainer that if you already have some money lying around somewhere, you can put it to some good use here.

✅ Getting help from family and friends: This is the only option on this list that is not totally self-financing because you’d probably have to pay back after some time. Nevertheless, it is more favorable compared to both unsecured and secured loans from banks and credit card companies.

✅ Liquidating your assets and possessions: For some people, if you look around, you might find one or two old or unused items that can be liquidated. Platforms like eBay make it easy to sell everything from books to household items.

✅ Starting with the tools you already have: Chances are that you already have the basic tools needed to bootstrap a business on the Internet — your computer or smartphone, Internet access, etc. You can pair this up with free tools and free trials

✅ Funding from a job: A day job can also be a sustainable source of funding for your online business. Using your salary to fund your venture allows you to maintain financial stability while gradually building your business on the side. This method is particularly advantageous if your online business is a passion project or a side hustle that you plan to transition into a full-time endeavour over time.

Also, keep in mind that the cost of starting an online business is usually more than just money.

It’s a Money-vs-Time Equation

Have you ever heard of a thing called “sweat equity?”

Here’s the thing:

When starting a business online, you’ll typically need to put in some money to ensure the business turns out all good. But it is not just money that is required. You’ll have to put in some time, too.

However, these two factors can often be traded off against each other.

Here’s what that means:

If you have limited time but ample funds to spare, you can outsource tasks to others, reducing your time commitment but increasing your financial outlay. Conversely, if you have limited funds, you’ll need to invest more of your time into building your business.

That is what is known as “sweat equity.”

For example, it might feel good to want to outsource your website design. But that’ll cost money, right? The other option is to use WordPress to design it yourself, and that costs time.

It’s a money-versus-time equation: you need both time and money to succeed, but one of those can be traded off against the other.

The key is to find the right balance between time and money that suits your individual circumstances and goals.

Funding Options for High-Capital Online Businesses

Launching a high-capital online business can be a daunting task, especially when considering the significant financial investments required. However, there are several effective strategies to secure funding and bring your entrepreneurial dreams to life.

Crowdfunding: Crowdfunding platforms like Kickstarter, Indiegogo, and GoFundMe offer an excellent opportunity to validate your business idea and raise funds from a passionate audience. These platforms allow you to present your concept, showcase its potential, and attract financial support from individuals who believe in your vision.
Leveraging Other People’s Resources (OPR): OPR involves strategically utilizing the resources of others to minimize your own capital outlay. This could be other people’s money, time, knowledge, systems, contacts, or even communication and distribution channels.

Conclusion

In this post, I’ve pretty much answered the question “What are the things I need to start an online business?”

As highlighted, the answer is not a one-size-fits-all scenario. The requirements vary based on factors such as business model, tool requirements, education, and marketing strategy, among others.

While the common requirements listed above provide a solid foundation, the specific tools and services needed will depend on the unique nature of the business you’re looking to create. It’s crucial to tailor your approach to align precisely with the demands of your particular situation.

In essence, starting an online business is a personalized journey, and the success of your endeavour hinges on the thoughtful selection of resources and strategies tailored to your specific business model and goals.