Top 10 Lessons on How to Make a Living on the Internet
“Don’t ask what the world needs. Ask what makes you come alive, and go do it. Because what the world needs is people who have come alive.” — Howard Thurman
Editor’s note: This is a guest post by Pat Flynn of Smart Passive Income.com. Here’s what I like about Pat — he goes above and beyond and he keeps things real. I first stumbled across Pat while doing some research about really making a passive income online. I think it’s a skill more people will need as the world we know changes under our feet. As I read through Pat’s posts, it was clear that Pat lives and breathes his passion and he genuinely wants to help people succeed. I like that … I like that a lot.
I also like Pat’s bio … “I didn’t win the lottery, I don’t drive a fancy car, and I’m not a millionaire. What I do have is a beautiful wife, an awesome baby boy, a loving family, awesome friends, and a line of work that allows me to spend all of my time with them.” … Pat is leading an extraordinary life and loving it along the way and that is success in action.
I have to say, this is truly one of the most amazing posts I’ve read on how to make a living on the Web. I’m blown away. Rather than a step-by-step approach, it’s a set of timeless principles and patterns. Pat has distilled an incredible set of insights that he’s learned from actually making money online and walking his talk. Without further ado, here’s Pat on how to make a living on the Internet …
This post is not intended to be a step-by-step guide on how to make a living on the Internet. Think of it as a compendium of the lessons I’ve learned since starting a number of online businesses – lessons that I hope will be far more useful to you than any “system” I could possibly teach. The fact is that there are thousands of different business models one could choose from if you do want to make a living online, but it’s the core principles and motivations behind them that determine whether or not it will be successful and long-lasting, or just a waste of your time.
Lesson 1: Internet Business is Not For Everyone
This might seem like a weird first lesson to you, but it’s absolutely true – Internet business is not for everyone. Although I feel very fortunate to be living how I am today, working from home for yourself does have its drawbacks:
- You Make ALL of the Decisions: Yes, this is the very reason why many people begin to work for themselves – to become their own boss and not answer to anyone else, but people fail to realize that this involves making business decisions that before (working 9 to 5) you would never even have to expend energy to figure out. With things like taxes, legal matters and healthcare, it can be too overwhelming for some to handle.
- Your Schedule Isn’t Set in Stone: Again, this is exactly what you want, right? A flexible schedule with the ability to work when you want? Yes, but a lot of discipline needs to come along with it in order for this to work. One problem that many Internet entrepreneurs have, including myself at times, is having the discipline to stop working and enjoy life. There is always more work that can be done, and it’s really easy to just step into the home office or open up the laptop and continue working.
- It’s Harder to Get Into Work Mode: Along the same lines, there are many distractions at home and online that can stop an Internet entrepreneur from doing work that needs to be done. I’m sure you can think of a few yourself.
- No Co-Workers: Having co-workers to talk to and become friends with is probably what I miss most about working 9 to 5. Luckily, there are things like Twitter, Facebook and Skype that help me stay connected with people while working from home, but talking about Monday night’s football game isn’t quite the same anymore.
I do love working from home, don’t get me wrong, but its not exactly all fun and games. It may or may not be the right thing for you.
Lesson 2: Strive to Make the Internet a Better Place
With whatever you want to do online, if you’re not doing something that makes the Internet a better place – if you’re not creating something of value that people can appreciate and say, “This makes my life better”, then you’re not going to see any long-term success. I’ve experimented with a number of various methods to make money online, and what has always given me the best results and the most ROI for my time and money (not to mention what gives me the most fulfillment) are those projects and websites that actually help people – businesses that if for any reason were to disappear tomorrow, people would notice. My website at greenexamacademy.com, for example, helps people study for a small exam in the building and design industry. One day in 2009, my servers went down and my website was unavailable. That day, I remember receiving over 50 emails from people who were using my website asking me when it was going to be back up. This just shows the kind of value I was providing, which is a good reason why this particular business has consistently earned thousands of dollars for me each and every month for over two years.
Lesson 3: The Passive Income Business Model
As I mentioned before, there are several ways to make money online, but the business model that I’m about to share with you is the one that I use because of how much work is needed by me in order to make things run.
Here’s a flow chart of how things basically work, starting from the top: The driving force behind all of this is automation. As you can see, the only part of the equation that YOU are involved in is at the receiving end of a payment. Things can happen without you having to do anything, as long as it’s setup properly.
People can arrive to your website, purchase a product and have it automatically delivered to them without having to lift a finger. What’s nice about doing business online, especially today, is that there are so many different tools, services and resources available that make this passive income model possible. And, if there are tasks in your business that do need the human touch, you can easily find someone else to do those things for you, on the cheap. On my site at greenexamacademy.com, I sell eBook and audio study guides that I created to help people pass the LEED exam. I purposely choose to only sell digital products because I can use a service like e-junkie.com to accept payments and automatically deliver these electronic goods without having to take the time and worry about going to the post office or shipping and handling. Furthermore, because my business is online, my “store” is open 24 hours, 7 days a week, 365 days a year and is open to the entire world. Just to give you an idea of what passive income can do for you, in March of 2009 I had worked a total of 8 hours the entire month. Most of my time was spent in Hawaii with my wife on our honeymoon and just settling into a new apartment. This month happened to also be my most profitable month ever, grossing $30,328.48. It’s an amazing feeling to know that you have businesses setup working for you, instead of the other way around. Obviously, however, you can’t take yourself totally out of the equation (since you may need to answer emails and deal with customer service), but you can get really close. As Tim Ferriss, author of The 4-Hour Work Week says, “I am not a tollbooth through which anything needs to pass. I am more like a police officer on the side of the road who can step in if need be…” What’s nice about this business model is that it’s something that you can setup in your spare time and continue to have while working a 9 to 5 job if you want. Also, since things are mostly run on autopilot, you can use that extra time to do the things that you want, whether it’s travel the world, stay at home with the family, or even work on setting up new passive income streams.
Lesson 4: Take Action
In other words – just do it.
We all have business ideas (or ideas that will improve our existing businesses), but ideas mean nothing unless they are put into action. We can plan as much as we want, but planning is just that – a plan. It’s the doing that actually gets you somewhere. I consider myself pretty lucky that I was laid off. It wasn’t a good feeling, that’s for sure, but looking back, my lay off (and the terrible economy which made it virtually impossible to land another job in the architecture industry) is what forced me to take that action. I really had no choice, which is why I think I’m where I’m at today. It can be tough to take action when it’s not totally necessary, which is why I use the following “mind hacks” to make sure I get things done:
- I always set a deadline. I find that I’m more focused when I work under pressure, and if I know something has to be done by a certain time, I’ll make sure that it happens. This goes for items both big and small.
- I get others to hold me accountable. Sometimes, all this requires is announcing or telling people what I want to do. This forces me to take action because I don’t want to say I’ll do something and not follow through.
Lesson 5: Take BOLD Actions
To expand on lesson #4, not only should you take action, but you should take bold actions that will make a big difference. It’s like in golf. When you’re putting, if you swing your club and hit the ball but it never even reaches the hole, you’re not giving yourself a chance to sink the putt. It’s impossible. If you take a strong stroke and your ball rolls past the hole, then at least you gave yourself a chance to sink the putt. Another way to look at bold actions is to compare it to some advice I learned from Ramit Sethi of iwillteachyoutoberich.com. He says that in the personal finance game, it’s always better to go for “the big wins”. He explains that being frugal and saving money by brown bagging your lunch or cutting down the number of non-fat grande white chocolate mochas you drink is virtually pointless. Although you will save money little by little, you can have more money in your life by going for the “big wins” like finding the lowest interest rate, negotiating down the price of your next car, or even starting your own business, and you can even still enjoy your non-fat mocha whatsits. When I first started doing business online, I was making money through advertisements on my blog, but it was after spending two months writing my first eBook study guide that I saw my income skyrocket from $250 a month, to over $8,000.00 a month. Then, instead of working on small things for my business, I took another bold action and added an audio guide to my product line. $1400 for a voice talent and another month later I took that product live and I began to see upwards of $15,000 to $20,000 a month. Bold actions = big results.
Lesson 6: Stop Worrying About Being Perfect
I have worked with so many people who are starting online businesses who take forever to get things rolling because they want things to be perfect, and what happens is they end up missing out on valuable opportunities or chances to really make some good money online. Like I said before – just do it! As long as your product, website or whatever it is you’re doing online has value and the message comes across clearly, all of that perfection stuff doesn’t even matter. Many people use perfection as an excuse. “I want things to be perfect” is just another way of saying “I’m too scared to really do this.” You don’t have to be perfect to be profitable! Get something out there now and you can worry about perfecting it later. It takes time for things to happen, so the longer you keep “making things perfect”, the longer it will take for you to see results.
Lesson 7: The King and Queen of Online Business
Content is King. Content, or what you write or publish online and in your products, is the driving factor behind any successful online business. Not only because original and desirable content matters to people, but because it matters to the search engines and their algorithms for what pages rank higher than others as well. You will hear many Internet marketers preach the phrase “Content is King” quite often. Not many of them, however, have taken on the idea that Design is just as important, but it is. Design is the Queen, and as we all know (especially if you’re married), sometimes the Queen has more of a say. This is why companies like Apple go over-the-top on the design of their products, because they know that there are people out there who really care about what something looks like, sometimes even more than what the product actually does. If you’re going to sell an eBook or audio product online, you should always include a high-qualty digital representation of the product on your sales page. There are companies out there (like coveractionpro) that are dedicated to doing just that – creating high-quality eBook and CD covers – because they know that design matters too.
Lesson 8: Specialize
When I ask people who their target audience is, the worst thing they can respond with is “everybody”. If you try to cater to everyone, you’re going to sell to no one. At most of the malls here in San Diego, there are at least 5 or 6 different types of shoe stores. There’s a store for athletic shoes, casual shoes, dressy shoes, walking shoes, and even one that sells only sandals. So why isn’t there one “all-kinds of shoes” store at the mall which could just tear the little competitors apart? Because it wouldn’t. Businesses know that the more you can cater to a specific type of person, the more likely it is that that person will buy from you. If someone is shopping for some serious basketball shoes, which store do you think they would visit: All Shoes Company, the shoe store that has all different kinds of shoes, or The Athletic Foot Company, a store that specializes in shoes for athletes. Of course, the Athletic Foot Company, since they would probably know more about basketball shoes and have a better selection than All Shoes Company. This “specialization” is even more important online, which is why you must really narrow down your niche and figure out exactly who your target audience is. There are over 6 billion people in this world, and you don’t need to build a business for all of them. In fact, you shouldn’t. Even a small, tiny niche like the LEED exam can be very profitable, and it’s even at your advantage to stay narrow, because you’ll run into less competition, both in terms of number of competing companies, and ranking in the search engines.
Lesson 9: Join a Mastermind Group
One of the smartest things I’ve ever done is join a mastermind group. For those of you who don’t know, a mastermind group is just a fancy term for a group of people with a common goal that meet (in person, on the phone, via Skype, chatrooms, meeting software, etc.) to share and learn to improve what they do. Think of it as a show and tell (and ask) for highly motivated individuals who want to get things done. In these meetings, members of the group share their ideas, questions, triumphs and downfalls. Members with questions get immediate feedback from the others, while everyone learns from everyone else’s experience and wisdom. I’m involved in two separate mastermind groups, both made up of other Internet entrepreneurs and business people who are all looking to improve what they do online. I’ve learned so much from these groups that I am confident in saying that if it were not for them, I would not be living like I am today. It’s not one single person, but rather the group as a whole that provide the advice and encouragement I need to get results. And, at the same time, I can give back a little bit of the knowledge that I know to help other people and their businesses succeed as well. You may know a group of people with similar interests who you may be able to get together with and start a mastermind group already, but if you don’t, and you’re interested, you might be able to find a group of people through Meetup.com or other online communities.
Lesson 10: Don’t Give Up
If you do decide to want to start something online, please understand that it will not be easy, and results don’t happen right away. There is no such thing as “get rich quick”, so don’t expect that. You will struggle and you will fail. That is what you can expect, and instead of giving up, learn from your mistakes and failures and just keep going. I’ve failed a number of times and I’m not afraid to admit that, but each failure brings me one step closer to a success. In all of my online businesses, I’ve wanted to give up at one point or another, but I’m really glad that I didn’t. Remember what your goals are, and take things one step at a time on your way there. And lastly, know that I’m not anyone special. I don’t consider myself an expert, and I only attribute my success to working hard, working smart and being confident that I could really make it happen.
BONUS Lesson 11: Always Over Deliver
To get even more results and leave a long lasting impression with your audience, one that will keep them coming back for more, you should always overdeliver on your promise. Always. Seth Godin simply describes this as “the free prize inside”. With my free eBook that you can get at ebooksthesmartway.com, I made sure to really go over the top with it. I’ve had people email me saying that I’m crazy for not selling it, and that it’s one of the best eBooks they have ever read (both paid and free). I did go crazy with it. I spent 2 months writing (and designing!) it to make sure that anyone who wants to publish, market and automate their own eBook could do it too. I went all out with it because I knew I was going to give it away for free, and that if I did that, people would be happy to pass it along and I’d be able to reach more people in the long run.
Before I go, I just wanted to say thanks to J.D. for allowing me to share a little bit of what I know and a bit of my story too. If you have any specific questions about my businesses or what I do online, you can leave a comment here and I will respond, or you can find me on my blog, Facebook or Twitter if you’d prefer that instead. I wish you nothing less than success. Cheers!