The rise of digital entrepreneurship: Tips for how to start a business online.
Learn about the tools you need to start a new business from home.
Get ahead of the competition.
Entrepreneurs are known to go against the grain, even when times get tough. Whether they are dealing with cash flow challenges, unpredictable customers, or other entrepreneurial adversities, their determination to turn their skills or passion projects into full-blown careers knows no bounds. Their dedication has paved the way for new generations of entrepreneurs to continue the mission to meet a need in the marketplace. The same principles guide entrepreneurs today, but a different tool kit may be necessary in order to stand out and succeed.
When COVID-19 triggered major economic downturns, high unemployment rates, and a collective push towards digital transformation for surviving businesses, “COVID-preneurs” pushed on with their dreams of becoming their own bosses at a record pace. According to the Peterson Institute for International Economics (PIIE), the number of new business applications (or applications for new Employer Identification Numbers —EINs — via the IRS Form SS-4) in the US shot up by 23% from January to September of 2020 compared to the same period of 2019.
To break this down even further, the US Census Bureau reported that there were 1,559,950 new business applications submitted from July to September 2020 alone. Compared to the 859,345 new applications submitted during the same period in 2019, this 82% increase in 2020 was the largest year-over-year spike ever recorded. While these numbers might seem perplexing, there are several reasons why entrepreneurship was on the rise during the height of the pandemic — and continues to be well into 2022.
What is a digital entrepreneur?
An entrepreneur is someone who is self-employed, often taking financial risks to operate and promote their business. Operating a business is no easy feat, and adding in a digital element can add to the workload. However, the digital world has made it easier for up-and-coming entrepreneurs to get their names out there.
Digital entrepreneurs are self employed with the addition of operating via digital platforms. They rely on Information Technology (IT) and digital media tools to find potential customers. These tools have given digital entrepreneurs the opportunity to promote their business outside of their local community. It saves the money they would need to spend on a physical office space and replaces it with a more affordable online store front.
Digital businesses include e-commerce, blogs, online courses, and other digital spaces for products and services. While all entrepreneurship requires a little leap of faith when it comes to finances, digital entrepreneurship offers a venue that is less likely to break the bank. The digital entrepreneur has greater flexibility in working where and when they want.
Digital entrepreneurship vs. entrepreneurship.
Digital entrepreneurs differ from other entrepreneurs mainly in the way they display goods and services — and the level of financial risk involved. Traditional entrepreneurship usually requires physical space in which to operate. Although these folks might use online sources to promote their goods and services, they don’t rely on that medium. And physical resources can often be more expensive than digital ones.
Another difference is in how they build a client base. Typical entrepreneurs depend on networking to build brand awareness. To maintain a steady client-base, the entrepreneur must build long-term customer relationships. Digital entrepreneurs, while also needing to build a client-base, don’t always need to go out in person to meet prospects. They can use online tools to reach specific target audiences and answer questions verbally.
For a digital business with a large global reach, it just isn’t possible to meet every client in person. While digital entrepreneurship offers greater expansion opportunities, this digital growth can create challenges for customer experiences. Digitization in all business functions can become more challenging the larger an organization is.
People have high expectations for larger businesses, so it’s important to pay close attention to ease of access for consumers. For example, can customers easily search for products or services they are interested in? Are you checking the help forum or comments on your site and answering customer questions in a timely manner?
Both traditional and digital entrepreneurs take risks and can reap tremendous benefits from their hard work. Both require building a network of loyal customers to promote brand awareness. By continually exceeding customer expectations, both can create a loyal fanbase. Digital entrepreneurship requires all the hustle of a traditional business enterprise, but with the additional possibility of maintaining a larger client base and consistently updating and adding to a digital front.
Digital entrepreneur skills.
The digital realm is flooded with people trying to sell you something, so you might wonder how it’s possible to stand out in a flood of media. One of the best ways to gain new clients is to showcase happy existing ones. It’s easy for you to rave about your product or services because it is your business and you are (hopefully) very passionate about it — but people want to see proof of product quality. Plus, customer reviews and testimonials help to address any concerns.
Digital entrepreneurs must find ways to be both better and different from competing brands. By putting yourself in the customer’s shoes and thinking about their needs, you can create content that’s more likely to resonate with them. Another way to stand out is to offer something out of the ordinary, target a specific niche, and invite customer feedback. When you go the extra mile to connect to your audience, your business will earn authentic fans.
To keep up in an ever-expanding digital world, you need to maintain a presence across multiple platforms. However, being on 20 different platforms may not be realistic — or helpful. Do your research and see where your client base spends time online. For example, if you create college sports jerseys, an important demographic might be 18–24 year olds. For that group, Tik Tok, Instagram, or Snapchat might be the best platforms to focus your advertising efforts on.
Why digital entrepreneurship.
Throughout 2021, Google Trends recorded significant upticks in searches like “how to start a business,” “how to start a business at home,” and “how to start a business online.” Here are a few key reasons digital entrepreneurship is on the rise:
- Increased opportunities
- Unconquered markets
- Easy access to consumers
- Reassessing the meaning of work and life
- Remote work flexibility
For aspiring digital entrepreneurs, there are more opportunities to start a business than ever before. Opportunities include having easy access to relatively inexpensive technology, such as using a laptop to launch apps for small businesses. There are also fewer capital restraints when acquiring funding — such as easier access to small business loans (SBLs), crowdfunding, and eager angel investors — as investors and lenders want to encourage the founding of new businesses that might have previously been unable to qualify for loans under stricter guidelines. These would theoretically take the economic place of those businesses lost in the wake of COVID-19. New business owners will also encounter less competition due to pandemic-related business closures.
The opportunity for entrepreneurs to control their own incomes — rather than relying solely on fixed incomes from an employer — also plays a major role in their drive to run their own online business. Let’s face it — who doesn’t want to be their own boss?
Between March and September of 2020, as many as 163,735 businesses in the US were marked “closed” on Yelp. Roughly 98,000 of these businesses were deemed permanently closed, leaving large gaps in many economic markets. While some digital entrepreneurs were able to capitalize on these market gaps, many unconquered markets were discovered as well — especially those related to digital transformation. For many new entrepreneurs, this period of innovation included hyper-relevant activities such as creating software-as-a-service (SaaS) applications to support remote work, providing virtual workout classes while gyms were closed, or offering contactless delivery services for groceries or food.
Easy access to consumers.
According to a survey conducted by Statista Research Department in February of 2021, 46% of respondents said they spent five to six hours each day on their mobile smartphones. This data means that not only are consumers theoretically available to marketers for a significant portion of the day, but marketers are right there in consumers’ pockets. In other words, customers are more easily reachable than ever before, especially for resourceful digital entrepreneurs that can use social media and mobile-commerce (m-commerce) platforms to their advantage.
What’s more, e-commerce sales continue to increase, driving more entrepreneurs to sell their goods and services online. From April to June of 2021 alone, e-commerce sales as a whole in the US reached $222.5 billion, which was an increase of 3.3% from the first quarter of 2021. And in the projected future, m-commerce (mobile commerce) sales alone are estimated to reach beyond $432 billion, which is up from $148 billion in 2018.
Reassessing the meaning of work and life.
According to a Washington Post-Schar School poll, nearly 1 in 3 US workers under age 40 have considered changing their occupation or field of work since the start of the pandemic. For those who were unemployed due to the pandemic, the Pew Research Center reported that 66% seriously considered changing their occupation or field of work. This massive reassessment of work, or Great Resignation, can be attributed to the pandemic altering how people think about what’s important or meaningful to them, both in life and in their careers. For some, this was a direct path towards becoming a digital entrepreneur.
Remote work flexibility.
The rise in remote work flexibility during the pandemic was a stepping stone to digital entrepreneurship for many. Some people likely found that more time spent working from home allowed them to commit more time toward developing a business plan. In addition, many people who were able to work from home for the first time quickly realized it was their preferred way of working.
According to surveys from Morning Consult, 81% of employees in the US say they enjoy working remotely, 74% of remote workers say they are more productive, and more than 3 in 4 adults would rather apply for jobs that offer remote work options. Additionally, in a May 2021 survey of 1,000 US adults, 39% said they would consider quitting if their employers weren’t flexible about remote work. When looking at millennials and Gen Z respondents, that number was 49%.
5 things to consider first.
It’s easy to see why so many new entrepreneurs are venturing out on their own despite the troubled economic climate of the pandemic age — but it’s important to recognize that starting your own online business doesn’t come without risks, regardless of how strong your niche market might be right now. If you’re a budding entrepreneur who’s thinking about starting your own business, you must:
1. Understand consumer demand.
2. Deal with failed developments or investments.
3. Have access to the right technology and tools.
4. Learn to be a leader.
5. Prepare for financial risks.
01. Understand consumer demand.
Do your research to ensure consumer demand is there for your product or service before venturing out on your own. In addition, take note of any startups or online competitors that are selling similar products or delivering similar services. Not only does this help you narrow down who your main competitors are, but it will guide you in your efforts to create a unique product or service that stands out from the crowd.
02. Gather funding.
Often, entrepreneurs must use their personal funds (referred to as bootstrapping) to get their startup off the ground, which can be a daunting undertaking. In the beginning, it’s important for new entrepreneurs to push forward with the goal of accessing funding from other sources soon, such as from small business loans (SBLs), angel investors, or crowdfunding.
03. Deal with failed developments or investments.
Running a business and taking risks go hand-in-hand, but entrepreneurs often have to make risky decisions that could drastically affect the success of their business. This is especially true when advanced engineering, development, or scientific research are required to create a product or deliver a service. As an entrepreneur, you would assume all risks if a specific development or investment failed. Sometimes this can be difficult to avoid, but knowing potential risks that could lie ahead can help you create backup plans or contingency funds should things go south.
04. Have access to the right technology and tools.
Having the right technology in your toolbelt can set your business apart from your competitors. As a digital entrepreneur, you’ll need to have relevant resources at your disposal to tap into the current online market, learn how to stand out from your competitors, and conduct business professionally. These resources include technologies like digital marketing tools, automation tools, data monitoring and analytics tools, and document management tools.
05. Learn to be a leader.
Becoming a digital entrepreneur might be more than becoming your own boss — it also could mean developing into a business leader. This is especially true if you need to build out a team of employees (including freelancers or contractors) or collaborate with partners or investors to move forward with your plans and reach your goals.
Outside of having a specific vision and being able to articulate it to employees or stakeholders, it’s important to view your work or ideas as pieces of a larger puzzle. That is, entrepreneurial success often includes collaboration with other people. Always be open to listening to new ideas or feedback from those helping you on your journey, and stay committed to helping your employees develop and grow. It’s also important to maintain transparent communication chains with all parties involved with your business.
How to start a business online.
Now that you’re familiar with some of the risks involved in starting your own online business, it’s time to start preparing for a successful launch. Below, we will detail a few things you can do to minimize roadblocks and maximize sales from the get-go.
Adapt to new business models.
Business models are constantly in flux, especially as the world continues to adapt to the digital transformation brought on by the pandemic. New digital entrepreneurs need to stay on their toes to remain flexible, adaptable, and unique in a sea of online competitors. As e-commerce (including m-commerce) continues to dominate, entrepreneurs must seek out clever ways to reach their audience in the vacuum that is the internet. They can explore new channels for selling online, such as featuring products on social media e-commerce platforms or leveraging influencers or brand ambassadors to get their name out there.
Adapting to new business models could also mean tweaking initial product offerings or introducing new product lines to keep up with trends or consumer demands. However, it’s important to thoroughly understand what your business does and not stray too far from your purpose before switching up current offerings or adding new ones. Remember, the intention of your digital business is to serve a niche and serve it well — not to be all things to all people.
Don’t be afraid of new technologies.
Digital entrepreneurs have access to more technologies and tools than ever before, so why not use them to your advantage? Not only will they help you run your online business more efficiently and save you valuable time, but they will help you tap into key customer insights and trends. Some technologies that new digital entrepreneurs should adopt from day one include:
The pandemic spurred digital transformation, causing many businesses to begin their journey to the cloud to stay agile. For new digital entrepreneurs, having access to cloud-native platforms can benefit a business and retain developmental momentum. For example, you can easily store and backup company data, run intensive software for small business apps, and streamline how you share information all from a high-speed, elastic remote server. Additionally, several SaaS solutions — such as Office 365 or Adobe Creative Cloud — can help you enhance business operations and workflows.
Digital marketing tools
From social media and email campaigns to search engine optimization (SEO) and pay-per-click (PPC) advertising, having access to a wide range of marketing tools is the foundation for success when running an online business. While many startups don’t have the working capital to hire a full-blown marketing agency, there are several affordable digital marketing tools available that make it easier to manage each aspect of your digital marketing efforts and initiatives. For example, Sprout Social is a popular social media management platform that helps you streamline your social media marketing strategy.
Learning about your online business processes (such as the checkout process on your e-commerce website) and your customers is essential to success. Thankfully, capturing data about them is easy with data monitoring tools — especially those that feature machine learning. Data-monitoring tools like Adobe Analytics automatically monitor and report on data trends and provide you with unique, meaningful insights into the efficiency of your selling platforms and customer behavior.
Customer relationship management (CRM) software
Your customers are the bread and butter of your online business, so understanding who they are, how they operate, and what they want at every step of their journey is invaluable. CRM software allows for a more intimate customer-company relationship, which can help when you’re developing strategic ways to increase sales and encourage repeat customers.
If you’re a “solopreneur” who handles all facets of your digital business, incorporating automation tools into your everyday routine can help save you time, energy, and money. Many automation tools — think virtual assistants or financial management software like QuickBooks Online — can handle more mundane business-related tasks like setting appointment reminders or tracking expenses. Even tools like Adobe Acrobat for businesses can help you automatically view, create, manipulate, print, and manage PDFs, such as important business contracts or order forms.
Focus on digital marketing.
You might think that if you build it, they will come. When it comes to establishing a successful business online, that plan doesn’t often work out. All across the digital plains of the internet, consumers are constantly inundated with digital marketing campaigns from your competitors.
The marketing they encounter could include search-engine-optimized (SEO) product pages, paid advertisement campaigns on Google, keyword-rich blogs that answer common customer questions, or engaging social media posts on platforms like Instagram or TikTok. To succeed in that landscape, it’s paramount that you create a comprehensive digital marketing plan centered around your target audience.
Outside of simply launching an e-commerce website that features your products or services, be sure to optimize your product pages with keywords that your customers are actively searching for on the web. To further bolster your digital marketing strategy, try writing informative, keyword-rich blogs that answer your customers’ most pressing questions related to your products or services.
In addition, maintain a presence on the social media platforms that your target audience uses most often, run compelling ads on those platforms, and don’t be afraid to partner with social media influencers or brand ambassadors to help get your brand out there.
Leverage existing marketplaces.
As a digital entrepreneur, your e-commerce website doesn’t have to be the only place you sell your products. In fact, tapping into existing marketplaces — such as Amazon, eBay, Walmart, and Etsy — is one of the easiest ways you can grow your customer base and boost sales. Several of these marketplaces are built to streamline your marketing, selling, and fulfillment initiatives with intuitive dashboards, user interfaces, and tools.
As a bonus, larger consumer marketplaces like Amazon have a massive number of loyal customers who regularly visit their sites to buy goods. What’s more, many of these shoppers don’t even bother searching for products on search engines like Google. In fact, as of March 2020, it was found that 63% of online shoppers go to Amazon to start searching for products.
Make smart investments.
Making smart investments upfront is key to future-proofing your business for unexpected economic downturns. Fortunately, the push to all things digital has left many opportunities for new entrepreneurs to avoid costly expenses and make better investments.
For example, as remote work continues to gain a foothold in our economy, small business owners have access to a larger, more diverse talent pool — especially non-salaried freelancers and contractors. Consequently, businesses won’t have to invest in expensive office rentals or equipment for remote employees.
With the explosion of e-commerce, new entrepreneurs can also turn their attention and investments towards digital marketing channels, rather than solely focusing on traditional marketing efforts that might not generate a positive ROI. With digital marketing strategies like email, PPC, and content marketing campaigns, small business owners can more accurately track customer behaviors and touchpoints and adapt accordingly — saving them major marketing dollars in the long run.
Business with Adobe Acrobat.
Contrary to what you might think, now is the perfect time for digital entrepreneurs to start their own businesses online. The remote-work revolution has broadened access to financial opportunities for would-be digital entrepreneurs — meaning more people are setting out to become their own boss and fulfill their passions. If you’re ready to become a digital entrepreneur, starting your own online business is a great way to build a brighter future and achieve your goals.
Looking for a tool to streamline your document management workflows as you get your digital business off the ground? With an Adobe Acrobat business subscription, you gain access to a comprehensive home business PDF solution. Adobe Document Cloud services are included, so you can tackle essential PDF tasks like converting documents to PDF with the Acrobat Reader mobile app or in your web browser. You also gain an Adobe Sign subscription, which is a swipe-and-tap solution to collect and sign legal electronic and digital signatures on any device.