10 Tips to Begin Your Start-Up Business Online

As promised, we are here with the follow-up blog story on 50 inspiring startups of 2012 with a handful of tips that will help you to start your online business. These tips could be a warning against mistakes people usually make or a guiding tip for online ventures.

10 Tips for Beginning Start-Up Business Online

Tip 1: You cannot copy businesses

Thinking of copying some ideas from the list of 50 inspiring startups? Yes? Because you think that doing so will give you the same proportion of success that the other person is enjoying. Right!

Start-Up Business Online You are very wrong. The reason that MLM businesses didn’t succeed after a certain level is because they were pulling the wool over people’s eyes saying you just have to copy the business model and wham, you are successful overnight.

It never happens that way. Whatever kind of business you want to do, it should be YOUR IDEA. Yes, you can take inspiration from others but the idea should be unique, something new.

If you want to do a start-up, you have to think from the mind of a consumer – the buyer. Would you buy product ‘XYZ’ if you were the buyer and not the owner? Think it yourself.

Tip 2: Don’t let go of employment

Start-up business is all about not being dependent on a boss to decide how much you want to earn. It is about becoming an entrepreneur. However, don’t let the excitement go in over-drive with wishful thinking.

You cannot make profits from Day 1. It takes usually about 3 years for a business to know whether it can survive of not. Year 1 is all hard work and struggle with little or no profits. Year 2 is break-even and Year 3 is when the business finally begins to make profits…generally.

So even if you keep 2 years margin to decide whether the start-up will work or not, how are you going to provide for yourself and your family? If you are employed, it’s best that you don’t leave it until you are stable enough in the business. I know that it means double hard work and leaving no stones unturned, but that’s the charm of being an entrepreneur. Isn’t it?

Tip 3: Find a support system

Your support system can be any of your family members or a mentor on a professional level. Start-up businesses cannot function alone. You need someone to guide you, motivate you in the lowest of low times, which you invariably will experience.

Whether you allow the mentor to take active interest in the business or just function as the creative / inspiring mind, is your call altogether. Moreover, if you are entering into a start-up with any family member, please ensure that the details of the partnership are clearly laid out to avoid problems in the future.

Tip 4: Research and expertise

There is no alternative to research and expertise which comes only through one’s personal experience and detailed knowledge of the chosen industry.

If your start-up is an eCommerce business, make sure that you are aware of your competition, prominent eCommerce brands, their investor relations, the product ranges and so on so forth.

You will see that a lot of your time is being spent on researching the business and it is good because the more knowledge you have, the better it is for your start-up business. To achieve this end, you can sign up with prominent business websites like CNN and Business Insider or buy niche market reports.

Do whatever you have to do for increasing your expertise over the select niche. It will definitely benefit you in the long run.

Tip 5: Convince the investors

If you had read the list of 50 inspiring stories, you would notice that I mentioned the name of many prominent investors backing those start-ups. How and why are they investing in these businesses?

First, the investors were shown a detailed business plan and/or a revenue model by the start-up founders. Second, they were impressed by the business, that is, its potential to make money.

If your start-up business plan can fulfill this criteria, you can avail a handsome seed capital to begin the business.

Can’t self funding work?

I remember mentioning the name of a gaming company who started with self funding and now it is a million dollar business but it doesn’t mean everyone can afford to. First, you need heavy savings for self funding. Second, if you have people dependent on you for sustenance, you cannot blow up all the savings.

Think hard before self funding. According to me, getting investors is a more viable option.

Tip 6: Sort out the taxes

A start-up should be a registered business; hence you have to take care of the taxes too. The tax system differs with each country but certain things are common such as employee welfare, taxes on goods / services delivered, and cost of registering a business and so on.

The kind of tax applied depends on the nature of the business. The taxes applying to LLC will be different from a Pvt. Ltd company.

You should never take chances with such matters. Get this sorted out while you are establishing the start up to avoid getting into problems later on. Consult a tax expert and draw up the mandatory tax payment so that you can include it in the start-up annual budget.

Don’t try to avoid dealing with taxes.

Tip 7: Get professionals on the team

A start-up business cannot be run alone – it is a fact. A business involves various aspects like marketing, accounting, sales, client relations, and administration and so on. Even if you are a multi-tasker, you will soon face burn out. In fact, when you add up the costs, you will see that you actually spent much more in trying to do all things yourself.

Hire a professional. At least, get a marketing, admin and product developer on the team at the earliest. It is believed that the first 10 people of any start-up business decide its fate in the long run. Therefore, be judicious in your choice.

We can tie this point to the self funding vs. finding investors issue. It will be extremely difficult to hire professionals and pay them salaries if you are self funding the business. On the other hand, if investors are involved, all the costs of running a company are shown to them when the business plan is presented; therefore, the employee salaries and other add-ons are well considered.

Tip 8: Begin networking ASAP

You cannot wait until the start-up business is up and functional to get clients and customers. In fact, setting up a pipeline of clients / buyers should be the primary agenda along with the business setting up process.

Marketing and networking are the backbone of any business. Try to get clients interested in the business from the start. Don’t waste precious time. It won’t come back again.

Tip 9: Concentrate on customer service

Some start-up businesses think that if someone is interested in their product or service, they will come back again and again. This is only partially true because if the customer service of the business is not good, there is no chance that it is going to get any first time buyers, least of all, second and third time buyers.

The way the support representative talks to the buyers, handles their queries, and sorts out their problem plays an important role in determining the image of the company. You have to agree that no matter what marketing strategy you use, the customers are the best marketing agents because they spread the word around.

Would you like to treat your customers – marketing agents badly? I surely hope not.

Tip 10: Be open to problems

A business plan gives a structure of the proposed business, it does not underline the problems you will face while actually running the business. Nobody can. Be ready to come across problems from Day 1. You have to maintain calm and patient to deal with them.

At the end of the day the problems might seem baseless but nonetheless, you have to deal with them. Be prepared, be open to problems – don’t be a complacent business owner. You will kill the business before it gets a chance to bloom.

Summary

I have tried to give you a lot of practical advice and tips. You have to have the psychology of a business owner before beginning a start-up. Business is a game and you have to become the master of it…

Understanding Forex Trading as a Long Term Income Opportunity

Forex, FX or Foreign Exchange trading is nothing but making money by trading foreign currencies. The history of Forex trading runs parallel with the history of money.

Before the Internet revolution, Forex trading was limited to multinationals, financial institutions and corporate companies who carried out currency exchange on a large scale. Small – medium businesses and individual investors could not think of getting involved in Forex but the Internet changed everything!

Understanding Forex TradingForex does not follow a regulated exchange process, which makes it different from stock trading and futures trading.

There are no clearing houses or central governing body exercising control over the Forex market. Presently, Forex is the largest liquid and fluid market in the whole world.

Trading is open 24 hours a day from EST 5pm Sunday to EST 4pm Friday and the daily transaction inflow and outflow is 2 trillion USD.

There are no minimum or maximum investment barriers. You need not be a rocket scientist to understand how the Forex market works. All you need is a refresher course to understand the basics and a demo Forex trading account for few weeks to practice trading daily.

Consider the information given below as your basic Forex training session. All the information is up to date and relevant globally.

How Does Forex Trading Work?

As a Forex trading investor, you need to team up with a Forex broker whose job is to carry out the currency exchange on your behalf. In online Forex trading, you use certain software systems to carry out the exchange automatically. Of course, the first step then is to seek out a reputable and popular Forex brokerage company.

These days most of the brokerage companies offer demo accounts, especially to those who are new in this field of making money online. After weeks of practice with the demo account, you step into the real platform with real currency.

With the help of Forex trading platform, you buy and sell currency – the profit earned in between is added to your account and can be withdrawn anytime.

In return for providing you the platform, you pay the brokerage company a predetermined percentage as commission. Let’s do a recap of what you need:

  1. An account with a verified brokerage company.
  2. A valid bank account linked with a Forex account
  3. A valid email account
  4. Amount to fund the investment
  5. Money to pay the brokerage commission

Tips for Selecting Brokers

  • You are not going to handover hundreds of dollars to a broker without doing a background check. You need to find out whether the broker will provide optimum security to your funds. Fortunately, there are ways to check broker credibility with the help of regulatory bodies in every major country. USA has National Futures Association and Commodity Futures Trading Association; United Kingdom has Financial Services Authority; Australia has Australian Securities and Investment Commission; Germany has Bundesanstalt für Finanzdienstleistungsaufsicht; France has Autorité des Marchés Financiers and Switzerland has Swiss Federal Banking Commission.
  • The online trading platform of the broker should be easily accessible and hassle free. Genuine brokers will ensure that their trading platform is user friendly and provide updated technological facilities like live news feed and charting tools to make trading easier. Moreover, the broker should be competent enough to carry out transactions on your behalf. The broker should not lose your funds in losses.
  • You can judge the competence level of a broker by evaluating the customer service provided. Most of the brokers online have a nightmarish “after sale” (after account opening) support system.
  • While you are checking the broker’s credibility, you need to check the withdrawal system provided by the brokering service. The withdrawal system should be hassle free and instantly process withdrawal requests. A broker has no reason to hold up your funds.

How Do You Trade Currencies?

There are four major currency trading pairs accepted globally:

  1. GBP / USD (British Pound and US Dollars)
  2. EUR / USD (Euro and US Dollars)
  3. USD / JPY (US Dollars and Japanese Yen)
  4. USD / CHF (US Dollars and Swiss Frank)

Other less common or not frequent currency exchange pairs are:

  1. AUD / USD (Australian Dollar and US Dollar)
  2. USD / CAD (US Dollar and Canadian Dollar)
  3. NZD / USD (New Zealand Dollar and US Dollar)
  4. EUR / JPY (Euro and Japanese Yen)
  5. GBP / JPY (Great Britain Pond and Japanese Yen)
  6. EUR / GBP (Euro and Great Britain Pound)

Notice the currency pairs – the first currency is always counted as commodity and the second one is counted as money. In other words, in the EUR / USD pair, you buy Euro against US Dollars and if you wish to sell, you sell Euro against US Dollars.

The best thing about working with Forex trading software is that everything is taken care of automatically. You don’t have to worry about transaction rates or exchange prices.

Now you must be asking – where does the money come in? Or, in finance terms, how to estimate the time to trade? When is the market ‘high’ to make a profit?

Let’s take the EUR / USD pair again. Either you buy EUR when the price is low and sell it when USD is high or sell EUR at high price and buy USD at low price. For instance, you buy EUR when 1 EUR = 1.41138 USD and you sell EUR when 1 EUR = 2.41138 USD. You make a profit in this transaction… it’s easy, right?

Now how would you know when to buy and when to sell? There are two basic techniques:

  1. Fundamental Analysis – This method looks into the current political and economic conditions of major countries and then predicts how the market is going to turn out in the next few days. For instance, if the present US market is showing economic growth then Forex traders will buy USD because the price of USD will rise. Similarly, if there is economic slump then Forex traders will want to sell USD even if they have to suffer some loss. Waiting to sell currency of a country when the country’s economic and political situation is going downward will only result in loss. Therefore, traders try to minimize the loss and sell while they still can.
  2. Technical Analysis – This method uses Indicators and Price Chart Analysis to analyze the direction of currency market in the next few days. If you wish to become a Forex trader, especially intraday trader, you need to learn Technical Analysis to make informed decisions about your investment. Give yourself a few months to learn all about Technical Analysis. There are lots of free resources online for help.

Experienced Forex traders believe in following both the techniques closely before buying and selling currencies. In Forex you do not actually sell or buy anything in the traditional sense of the term. All the transactions are electronically carried out in specific currency pairs. The reason why Forex exists is to facilitate currency exchange in order to pump in funds to multinational companies, corporate and financial institutions.

Making a Living with Forex Trading

There are people who have turned Forex trading into their permanent source of income online. After all, Forex trading is one financial industry that is recession proof. People who earn from Forex permanently have spent years mastering this trade so don’t expect you can do the same in a matter of months.

Until you know the pros and cons of the trade, you cannot take a leap of faith; leave your full time job and sit at home working online 24 hours a day trading currencies. If you are serious about trading Forex for a living, know this:

  1. Earning money from Forex is not a get – rich – quick scheme. You cannot become a millionaire in a day.
  2. There is no software in the market that will earn you profits instantly. If it had been, that software would have sold for thousands of dollars! What there software does is support you and reduce technicalities that would have been otherwise difficult to deal with personally.
  3. You should be ready to invest anywhere between 6 months to 2 years to learn the trade completely. Don’t give up your job yet. First spend 3-4 months with a demo account, another 3-4 months to learn the Forex trade and then the next 10 – 12 months doing real trades. Start with a small investment and increase your investment amount as you learn more about Forex.
  4. You need to be good with money management. Don’t be impulsive and whimsical while trading. You need to think like a finance expert would in your place and then get involved in FX trading.

Advantages with Forex Trading

  1. A Forex investor can trade anytime. The markets are open 5 days a week from Sunday to Friday. This 24 hour trading facility makes it easy to trade from anywhere around the world and takes care of the global time differences.
  2. If there are million Forex investors, each one of them has equal opportunity to earn profits. There is no competition or bidding process. Moreover, Forex trading is also known as ‘over the counter’ trading, that is, you buy currency and you sell currency – the balance is maintained and you earn profits in real time.
  3. Forex market offers 100% liquidity. There are no cash bonds or waiting period to get your profit. Little slippage, price stability and narrow spreads gives Forex currencies high liquidity level.
  4. Every dollar or any currency invested can be leveraged to its full potential. It means that investors can make huge amounts of profit by investing little. Again, don’t mistake this as a get rich quick scheme. As mentioned earlier, this trade needs patience and devotion for you to learn the ropes first.
  5. Regular investors dealing with Forex markets daily need not pay any commission. These are called “free of commission” trading.

Disadvantages with Forex Trading

  1. The 24 hour 5 day a week market has its share of disadvantages as well. For traders, it is difficult to keep track of the market movement 24 hours a day. This way you can lose profits. This is the reason why it is advisable to hire Forex brokers. The brokers will give you minute by minute details of market fluctuations and also guide you with buying and selling currency.
  2. If you are dealing in large amounts of money, there is risk of loss in a high leverage market. You can lose buying and selling opportunities in a matter of seconds, and you are left with marginal profits only. This is another reason why efficient and clever money management is needed.


Final Thoughts

Learning to Forex is like any other trade where you have to spend time learning its basics and then put the learning to practice.

Again we repeat – Forex trading is not a shortcut method of getting rich quickly. You need perseverance, patience and dedication to turn Forex trading into a long term income source. In the meantime, search for free resources online and get yourself acquainted with trading Forex online.