The internet has made it possible to start a business for virtually nothing. In our case, WhyDoWork.com was started at a cost of $7.95 for the domain name, and $12.00 for the first year of hosting. Our initial start up costs wound up being a whopping $19.95.

Since then things have obviously changed, but is it a wise idea to start from nothing? or should you be pouring out as much money as you can afford to get things off to a flying start? - It’s a question I’ve often asked and agonized about when launching a new venture.

One of our founders Joe (cho) once said this in a blog post:

….That’s the beautiful thing with the Internet. If you wanted to start your own business outside of the Internet you would generally require thousands of startup capital to get your business of the ground. With the Internet every site that has been successful for me has required no borrowing or taking chances. Besides the initial $20 I have never spent more money on developing or promoting the site then the site has already earned me. This type of safe, controlled growth will allow you to make money without taking any chances. It does take hard work and patience but results are achievable.

From the above it’s clear Joe thinks slow controlled (and cost effective) growth is the way to maximize your business potential. I tend to side with him however I do think that if you simplify things there’s two quicker ways to the top:

1. Social Media Hero and Quality Expert

In this case your blog or business picks up steam in social networking communities online and sees rapid growth or success because people are talking about you and digging your message. It could also be the case that your end product is of such high quality that it is impossible to ignore. Quite simply the cream will rise to the top.

2. Big Spender and Marketing Guru

In this case it’s likely you’ve received or have some significant start up capital either via investors or out-of-pocket. You’re working with bright minds in the advertising industry and reaping the benefits via paid traffic or sign ups as a result of your advertising initiatives. Success happens but it comes at a hefty price (6-7 figures).

Are you in either of these scenarios?

If you answered yes, congratulations. They are both great spots to be in. Scenario 1 it’s likely you haven’t spent a dime and have seen your traffic explode. Scenario 2 you’ve spent much of your investors money but have picked up enough steam to keep things afloat until your next round of financing.

If you didn’t fit my two generalizations fear not, I have one more for you!

Your Alternative: Slow, Controlled Growth

What might sound boring is actually your best chance at success if you’re not in Scenario 1 or 2. If you can’t afford a lavish advertising campaign and aren’t seeing hordes of users as a result of social media all hope is not lost. Continue doing what you’re doing, re-invest your earnings whenever possible, and eventually things will snowball and you’ll catch up to those in Scenarios 1 and 2. In this case patience is the most important virtue. I always like to use our forums as an example. We launched our forum in mid June of 2004. It was a full month before someone outside of our circles joined the site. One full month of 0 growth before getting a single bite (in terms of a sign up).

Since that time we’re now getting about 1,000 bites a month.

I postulate that any business can be massaged into one of the three scenarios I’ve outlined above, most falling into the third. I’d be interested to know what you think. Drop me a comment if you have any ideas or opinions!

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