I can sell you the sexy dream of passive income like so-called gurus, but I can’t because I know the reality.
You know the ones: e-commerce, dropshipping, print-on-demand, digital products, affiliate marketing. They make it sound like you’ll be sipping pina coladas on a beach while your bank account magically grows. But I feel those businesses are terrible for beginners.
Why? Because they’re high-risk, require a ton of upfront investment (both time and money), and let’s face it, most people don’t make a dime. If you’re just starting out, you don’t need a business that’s going to drain your savings and leave you frustrated. You need something simple, low-risk, and sustainable.
So what should you start? After hours of research, brainstorming, and a little help from my team, I’ve narrowed it down to three main types of businesses that are perfect for beginners.
Business Type #1
Ah, the classic. Product-based businesses are exactly what they sound like—you sell a physical or digital product. Think candles, puzzles, couches, or even online courses. Sounds straightforward, right? Well, not so fast.
The Pros:
Big Financial Opportunity: If you nail it, you could build a multimillion-dollar or even billion-dollar business.
Scalability: Once you set up systems and hire a team, the business can grow without you being hands-on 24/7
Freedom: You’re the CEO, baby! You call the shots.
The Cons:
High Risk: Most product-based businesses fail. Why? Because they’re way more complicated than gurus let on.
Upfront Investment: You need money to create the product, build a website, and drive traffic (aka ads).
Time-Consuming: It can take months (or years) to turn a profit.
Physical vs. Digital Products:
Physical Products: Think dropshipping, print-on-demand, or selling handmade goods. Pros? Big financial upside. Cons? Logistics, packaging, and shipping are a nightmare if you’re not experienced.
Digital Products: Templates, printables, online courses, etc. Pros? Cheaper and faster to create. Cons? Super competitive, and you still need to figure out how to drive traffic and stand out.
Verdict: Product-based businesses are not beginner-friendly.I’d put these in the “D-tier” category.
I’ve been in business for 5+ years, and with my experience, I sell digital & physical products both. And I make money with it every month without directly selling it, but it requires time and experience for sure!
Business Type #2
This is the world of Youtubers, influencers, podcasters, and bloggers. If you’ve ever dreamed of becoming the next Mr. Beast or Emma Chamberlain, this is your lane.
The Pros:
Multiple Income Streams: Ad revenue, sponsorships, digital products, memberships—you name it.
Community Building: You get to connect with like-minded people who share your interests.
Creative Freedom: You get to talk about what you love (and hopefully get paid for it).
The Cons:
Extremely Competitive: The market is flooded. Standing out requires a unique personality, niche, or editing style.
Upfront Work: You’ll likely create content for free for months (or even years) before seeing a dime.
Mental Health Challenges: When you’re the product, it can be hard to separate your self-worth from your success.
Verdict: Content-based businesses are a solid “B-tier” option for beginners. They’re not the easiest to monetize quickly, but they’re a great way to build an audience and learn valuable skills like marketing and communication. Plus, if you ever want to start a product-based business, having an audience will give you a huge advantage.
If you want play the Content game, I've got the best resource for you:
Business Type #3
Drumroll, please…This is my top recommendation for beginners. Service-based businesses are all about selling your time, skills, or money to get started.
Two types of service-based businesses:
Freelancing (solo service): This is where you offer a service directly to clients. Think copywriting, graphic design, social media management, or virtual assistance (the fun part; I tried all and more).
Agencies: Once you’ve mastered freelancing, you can scale up by hiring a team and taking on bigger clients.
Why Freelancing is Perfect for Beginners:
Low Barrier to Entry: You don’t need a fancy degree or years of experience. With a little Googling and some hustle, you can start offering services.
Get paid to Learn: As a freelancer, you’re essentially getting paid to figure things out. It’s like a backstage pass to the business world.
Flexibility: You can work from anywhere, set your hours, and choose clients you actually like.
The Pros:
Low Risk: You don’t need to invest a ton of money upfront.
Scalable: Start as a solo freelancer, then grow into an agency if you want.
Invaluable Experience: You’ll learn how businesses operate, which is gold if you ever want to start your own product-based business.
The Cons:
Income Insecurity: In the beginning, it can take time to build a steady client base.
No Safety Net: You’ll need to handle things like health insurance and retirement savings on your own.
Proactivity Required: You’ll need to take initiative and learn on the job.
Virdict: Freelancing is the ultimate “S-tier” business for beginners. It’s low-risk, low-cost, and gives you the skills and experience you need to succeed in any other type of business.
If you are interested in the service business, I have the best resources, where I include everything and make it quick and actionable:
The Ultimate Beginner Business Pipeline
Here’s how I recommend starting your entrepreneurial journey:
Start as a Junior Freelancer: Offer simple services like social media management, graphic design, or virtual assistance.
Level Up to Mid/Senior Freelancing: As you gain experience, specialize in higher-paying skills like copywriting or web development.
Build an Audience: Start creating content around your niche to attract clients and establish authority.
Create Digital Products: Use your expertise to create templates, courses, or other digital products.
Consider Physical Products: Once you’ve built an audience and have some capital, you can explore product-based businesses.
Final Thought
Starting an online business is not complicated; as a beginner, your best bet is to just start with a low-risk and low-cost business plan.
So what are you waiting for? Pick a service, start small, and remember—every big business started with a single step. You’ve got this!
That’s it for today…
In the next newsletter, I’ll go deep into one business type. If you’re interested and don’t want to miss out, subscribe here: