Should We Invest in Internet Businesses?

Internet Businesses

Do you Remember the time when Internet businesses first came into existence with the 90s.com era? That was a time when everyone was investing in the internet businesses. Some of the investors were lucky enough to become rich but most of them failed. Internet was very new back then and it was not an ideal time for anyone to start investing without understanding the details.

The days have changed a lot. Internet is more or less 25 years old now and a lot of businesses have made millions on the back of internet. As it is an established medium now, is it the right time to invest in the internet based businesses? We will talk about that in this article.
Invest

Scalability

An online business can easily scale a lot more than a traditional brick and mortar. Being location independent, an online business can easily cater to a large group of audience. With more people being into social media, it is easier for an online business to target them with methods such as retargeting advertisement and SEO.

These benefits often result in immense scalability for an online business which also means that the business becomes a lucrative one to invest in. Scaling any business is not an easy task but the task is often a bit simpler when it is an online business. Buying a domain extension is a lot easier than setting up a new shop in another location. It costs low, it is faster in terms of time management and it is easier from the logistic point of view too.

Freedom

Many individuals get into the world of online businesses thinking that they won’t have to work from dawn to dusk in a cubicle as they will be able to work on their own hours. While that is not entirely true, it is true that you as an internet entrepreneur won’t have to stick to one place of work.

When you are operating your business on the internet, you do not need a fancy office to manage your day to day tasks. Your laptop and a Wi-Fi connection are often good enough for you. This is the reason that the whole digital nomad & entrepreneurship have grown massively in the last few years. Entrepreneurs are no longer limited to staying in one country. They want to have fun while they are working. When this means that they can go places and still work, it also means that they always work even on their vacation.

If you are interested in that lifestyle, investing in an internet business is something that you should definitely think about.

Low Overhead

It doesn’t require an expert to understand that when you are managing your business digitally, you won’t have to spend as much money like a traditional office based company. Some of the biggest companies of the world now do not have an office. One such example is Linux. Since the beginning, this company has never had an office and they do not plan getting one either.

This helps a lot to maintain low overhead and high margins. When you don’t have to spend on things such as office, electricity and even coffee, you save a good amount of money at the end of the month which goes directly to the profit of your company. Some of the biggest internet businesses have the lowest overhead rates in world. Also, it depends a lot on the product or service of your online business.

For example, if you are like Amazon who sells products, you will need warehouse to store your inventory. On the other hand, if you are an app company who sells games or applications, you do not actually need anything. That gives you a big advantage in terms of your cost management. Some of the most giant companies around the world do not have a lot of employees as they work with a core team and the support of freelancers from all over the world. These are benefits that you only get in an internet business.
Saving

Access to Global Market

This is a great benefit of an online or internet based business. Internet is one and internet is same everywhere no matter what’s the country or the town. Whether you want to operate in every town of your country or you want to operate in every country of the world, internet will enable that option for you.

It is only internet based businesses that allow you to operate globally. There are people who do not own any products but still manages to sell products from China to North America with the help of Drop Shipping and internet. Internet enables opportunity that no other form can in terms of reaching a global audience base.
Access to Investors

Access to Investors

It is easier for anyone to find investors online than to find them in the local area. Online businesses again have a wide range of opportunities as investors can come and join them from any part of the world. You can be operating an online business in Asia and you can look for investors in North America.

The investors won’t hesitate to invest in your company because of the business model. As the business is internet based, it is easier for anyone to understand the style of the business. If it was a restaurant in Asia then you would not be able to find an investor from North America for your business.

In short, this is definitely the perfect time to start investing in internet based businesses. However, like regular businesses, not all internet based businesses are great. You have to do your due diligence before you get into any sort of investment. Internet can offer you a lot of scams and you will have to be very careful on what to get into. It is always better if you have a good understanding of the industry that you are going to operate or invest into. That will help you in making your investment a great success.

1 COMMENT

  1. Great article man. I think this is going to get progressively easier over time, especially with the movement in crowdfunding and syndicates. Other geographies, like Canada for example, actually make it really easy for start ups to go public at a low cost and get access to equity. Very different dynamic vs the US

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