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Starting a Business

How to Start an Online Business

Starting an online business can be can be fun and exhilarating. It’s like taking life by the horns and going for it!

Among the staff here at Cash Blog, we’ve got a lot of experience with each step of the business-building process. We’ve been there and done that, and we can help you understand how to start an online business.

Come Up with an Online Business Idea

If you are still trying to find the right business idea, here are some insights that could help.

First: it helps a lot if you base your online business around something you love and are an expert with. For example, if mountain biking is your passion and you know it inside out, that might be a good place to start.

What we’ve found through experience is 1) if you don’t love what you’re doing then it’s going to be hard to stick with it long term, and 2) if you know a topic inside out, then there is likely a need in the world for someone with your expertise.

Sometimes it can be surprising to people that their expertise is coveted by others. Sticking with the example of mountain biking, it may be that you love it and you’re around mountain bikers all the time and all your friends are experts. Maybe you’re not even the most knowledgeable in your friend group.

But whether it’s apparent to you in your every day life or not, there are others who are not experts at mountain biking and who covet the expertise you have. As far as how much demand there is for your expertise, that can vary based on what the topic is. But in general, people can’t be experts at everything and therefore anything you have expertise in will be coveted by someone who is looking to gain expertise in that area.

Your expertise is a huge part of the value you can offer with your online business!

Second: Within the realm of your expertise, maybe you’ve noticed ways where other online businesses don’t adequately meet your needs. If you can address this need with your business, then it might allow you carve a niche for yourself in the industry. It also makes you different than others, which can be a key to business success.

Sticking with the mountain biking example, maybe you’ve noticed that online retailers of bike parts use plain vanilla part descriptions and they aren’t personalized enough. Or maybe you noticed there isn’t a service out there that teaches you in one set of tutorials how to start from square one and go on to become an expert at mountain biking.

Basically, if you have ever felt that there is any sort of lack in the field of your expertise, that might be where you can carve a niche for your online business.

Choosing a Business Name

As your business idea is starting to come into focus, then you get the fun task of choosing a business name.

It can be helpful to use a business name generator tool like this one. You can populate the tool with some keywords that are relevant and it will spit out lots of ideas. Most of the ideas will not work, but you might get some inspiration from it.

Before you get hooked on any given business name though, make sure that the domain name is available for it! For any online business, it’s imperative that you have a domain name that ties to your business name.

In fact, what we like to do is have our Namecheap domain name search engine open while we think of business names so that as each idea pops into our minds, we’re checking to see if the domain name is available. Domain name availability can be a huge factor in choosing a name for your online business.

Choosing an Online Business Model

Ok so now you’ve got an idea for your business and you’ve got a name in mind. It’s a good time to figure out which business model you are going to use.

Ecommerce Website

Are you going to sell merchandise online? Then an ecommerce store is probably the way to go. This is the type of business where you list products for sale and when a customer orders an item, you have the item shipped to the customer.

There are a lot of platforms out there that are designed to make it easy to set up an online ecommerce business. We made a list of the best ecommerce platforms that should prove helpful.

Note: these days, with ecommerce businesses, you don’t necessarily need to warehouse the products yourself. Many manufacturers or wholesale distributors will warehouse the products for you and ship them directly to your customer on your behalf.


If you are not going to sell physical merchandise, maybe you are you going to sell information. If you are an expert at something, you can take your knowledge, articulate it, and publish it on a website to sell it.

One way to do this is to create an e-book. This allows people to pay a one-time fee for access to the information you published. This might work particularly well if the content you write is entirely in the form of text and pictures (no videos) and if the information doesn’t change over time.

Check out our guide about How to Create an Ebook for tips to get started.

Online Subscription Business

Another way to generate income from selling information online is to create a subscription-based business. This is one where people pay a recurring fee each month or year to have access to your expertise.

This might work well if a lot of your content is in the form of videos. It might also work well if there is an ongoing community element involved with your service, or if you are providing ongoing expertise on a regular basis.

The key thing you need is a website that has a login feature (such as a WordPress site), as well as a payment processor who can manage automated subscriptions (such as Paypal), and then you can load up the login section with all the content that people would be paying for.


One other way to sell information online is to publish it on your own blog.

Earning revenues on blogs typically comes in a different way though. Instead of charging people to access your information, instead you give it to them for free and you charge advertisers to get in front of your audience.

If this is up your alley, then check out our guide about the best blogging platforms.


Forming a Business Entity

Ok, so at this point, you’ve got a name picked out for your online business, you have the domain name secured, and you know what business model you plan to run. It’s time to form an actual legal business entity.

You can’t collect revenues if you don’t have a formal business entity. You can’t set up a bank account without it either.

Another important aspect about starting an online business is deciding whether you need liability protection. Starting an online business already comes with risk in the form of your time and any money you put into it, but if your business somehow ends up inadvertently harming someone else, then the risk could be immense if you don’t have the right entity type.

There are different types of business entities, and for each one there are differing rules and regulations in each state. Popular entity types include sole proprietorships, LLCs, and corporations.

Choosing which one is right for you isn’t always easy. This article isn’t intended to offer you any sort of legal advice, but we can at least break down a couple of typical generalities between them. Keep in mind that these may not hold for every state, so you still have to check with your state to be sure of the differences.

Cost: Sole proprietorships are the least expensive to set up typically. LLCs and corporations typically have annual fees required.

Liability: Sole proprietorships don’t offer any personal liability in case something goes wrong with your business. LLCs and corporations typically do.

Taxes: Corporations require their own separate tax returns, whereas for LLCs and sole proprietorships the income and expenses will flow through your personal tax return. That said, some types of corporations (S Corps) have income that flows through to your personal tax return even though they require their own tax return as well.

Paperwork: Corporations require a lot of formalities, like annual company meetings and minutes. LLCs require less, and sole proprietorships require almost none.

For online businesses, the entity types we’ve used most often are LLCs. For us and the state we live in, they’ve provided a nice blend of features. Not too much cost and work to maintain, yet they provide liability protection.

Setting up Email for your Online Business

If you have your domain in hand, you can go set up an email account for your online business. Not only will this allow you to start corresponding with people using a business email, but it will also unlock your ability to start tracking your website’s performance.

For us, the obvious choice for setting up an email is with Google’s Gmail service. At first you may think, “Hey I don’t want a Gmail account. I want an email that uses my domain name.” But that’s exactly what you can do with Gmail actually.

Let’s say your domain name is You can create a Gmail account that uses that domain name so that you can have email addresses like You can set up an email account like that by going here.

Setting up Website Tracking for Your Online Business

Once you have the domain name and you have the email account, now you can go in and set up Google Analytics. It’s free!

Google Analytics allows you to see all visitor activity on your website. There may not be much to see on Day 1, but as you build up the business you might get a lot of pleasure out of seeing what’s happening here.

You can see which pages people are visiting, how they got their, how long they stayed, and whether they bought anything. You get all the data you need in order to make informed business decisions. Here is a link to Google Analytics.

Building Out the Website for your Online Business

At this point you have your domain locked up and you know the business model you want. It’s time to build the website.

There are services out there that make it pretty easy to set up a website. Wix is one we like a lot. It’s almost like you can just cut and paste stuff onto the website like you would in a Word document, but even easier!

Shopify is probably the biggest name out there when it comes to creating an ecommerce website. They have all technical work done on the back-end, and all you have to do is populate the product information.

If you’re going with a blog, WordPress is the undisputed king of blogging software.

For some people, they don’t want to use a service like those mentioned above to create the website for their online business. There could be a number of reasons for this:

  1. It costs money to have the website run through one of those platforms, and once you build the site with one of them, you’re kind of sucked into their ecosystem and financially deterred from leaving.
  2. Even though these services are designed to make it easy to build a website, they still might require more work than you want to put into them.
  3. Since these services are “out of the box”, it makes it harder to customize them to stand out from the rest of the websites out there.

If you don’t want to use one of those softwares, you could instead do a custom build of your own website. If you aren’t already a programmer yourself, you could hire one to do it for you.

We like Upwork and have hired programmers from there before for some of our projects. What’s great about Upwork is that you have total control over the time spent. You can hire a programmer for 1 hour or 100 hours. You make the call.

No matter which route you take, you’re going to need a web hosting company. You can’t have an online business if you don’t host the website somewhere.

You can think of it like this: all the content of your website (images, text, videos) need a home. When you save the content for any given page, it has to get saved to a computer somewhere. That’s what the web host provides, and you can check out our guide for the best web hosting companies to find the one that’s right for you.

Marketing Your Online Business

Once you get your website up and running, it’s time to start getting the word out about your new online business!

One insight we all agree on: your website might never be truly “finished” or perfect. It’s always evolving. If you wait for it to be perfect, you might never actually get it off the ground.

So once you feel like it at least embodies what core concepts you wanted, then it’s a good time to start sharing it with friends and family. You could invite their feedback and expect that there will be constructive criticism.

For most of us here who have experience setting up online businesses, this stage of sharing with friends and family was a major one. It gave us a lot of valuable feedback. We were able to leave our ego at the door and focus more on hearing the feedback and using it to improve the business.

After you’ve incorporated that feedback, then you might be ready to start marketing your business. For a startup online business, our inclination has typically been to start with low-cost initiatives like these:

Join an Affiliate Program

This gives others a split of the profit if they help get the word out you. We like this approach because it allows you to generate new sales and profits without any up front risk. This is particularly good for business models that sell information.

You can check out our article about the best pay-per-lead affiliate programs to learn more.

Start Doing SEO

SEO stands for search engine optimization. This is the process of getting your website to show up for free in Google’s search results.

It’s a long term game, but if you keep planting the seeds the payoff can be noticeable over time. You can hire an SEO expert to give you guidance along the way. We like SEO Dude.

Join Facebook Groups

You can join Facebook groups related to your niche and start talking with people in there. If you have a link to your business in your profile, then normal conversations might generate leads. You can also try to help people who are expressing a need that matches a service like yours.


Doing some of these low-cost marketing methods might help you collect important stats, like which products are converting the best, and how many visitors are turning into customers, etc. This might give you enough ammunition to make an informed decision about paid marketing.

When it comes to paying up front for advertising of an online business, the opportunities are just about endless. You could do social media ads, Google Adwords, or just by any other sort of online ads.

The key with doing paid ads is to have a handle on your metrics. If you throw hundreds of dollars at a prepaid ad and you don’t have a way to track how it performs, then it might be a total waste. Early on especially, those ads can serve as a learning mechanism to teach you about your core audience.


So there you have it. Those are the key building blocks to setting up an online business. A number of us have followed these exact steps, and in some cases the end result ended up being a thriving business. You’re now well equipped to start this exciting adventure!




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Brian Renfrow

Brian Renfrow has more than 20 years of small business experience. He's been involved in entrepreneurial roles for more than 10 businesses since graduating from college with a degree in Economics.
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The content on is for informational and educational purposes only. It is not financial advice and we are not certified financial advisors. strives to keep its information accurate and up to date, but it may differ from actual numbers. We may have financial relationships with companies listed on our site. We may receive compensation for the placement of sponsored products or services. We work hard to write authentic and accurate articles.