How to Start a Service Based Online Business AND Make Money From It

Disclosure: This is a sponsored post. However, all thoughts and opinions are my own.

The year 2021 has never been a better time to start a new business. It is estimated that 60% of U.S. businesses closed due to the pandemic will stay closed forever. This leads to individuals needing to find a new way to make ends meet and starting a service-based online business could be the solution. However, it is far from easy and you must be fully committed if you are going to build a business that makes money.

So, what do you need to do to build a profitable service-based online business in 2021?

Step One: Determine what service(s) you want to offer

A service-based business online could take many forms. For new entrepreneurs, the most difficult decision is deciding which services to offer.

This is where market research comes in. You need to test different markets to see where the openings are. Just because a sector, such as web design or web development, is competitive does not make it oversaturated.

Furthermore, you need to evaluate the skills you have. As tempting as it might be to provide multiple services, it is generally recommended that you stick with a small number of services you excel at. 

Focus on what you can do well and determine whether there is a real demand for that service. It may be the case that you discover an untapped need within the market, which comes with more risk but potentially larger rewards.

Step Two: Determine if you want the online business to be part-time or full-time

For many newer entrepreneurs, the goal is to become a full-time entrepreneur. However, quitting your job is a risk. It is far from necessary to quit your full-time job prior to achieving success. The fact is that even with a full-time job and the necessary time to sleep, you still have 72 hours per week to work on your business.

Most entrepreneurs are recommended to continue their full-time jobs while they get their new online business off the ground.

If you are currently unemployed, it is vital that you get on top of any unemployment benefits you may be entitled to while you work on generating an income from your online business. 

Step Three: Create a website and a marketing strategy

A business website is essential as it’ll be how customers do business with you. Additionally, you’ll want to create a marketing strategy so you can get your business website in front of potential customers. 

You do not need to spend thousands of dollars on a website. There are plenty of low-cost options for new online businesses, such as WordPress and Shopify. Look up some website creation guides for business owners and it should take no more than a few days to publish a professional website.

Once you have your platform, it is time to start marketing. This is where it can become overwhelming, but social media is most certainly the easiest method for advertising for any business and bringing in your first clients. 

You may choose to hand your marketing needs over to a professional Facebook ad agency. They will know how to drive targeted traffic to your business on your behalf, while you can focus on other aspects of the business. 

Step Four: Underpromise and overdeliver for your first few clients

Your first few clients will make or break your online business. If they are pleased with your services they are going to play a key role in you acquiring both a consistent income and marketing your business through word-of-mouth.

Word-of-mouth marketing is the single most powerful form of marketing available today. Approximately 63% of 18-34-year-olds revealed they are more likely to trust a recommendation from an influencer than anything a brand can say, for example.

For those first few clients, give them more than they expect. Overestimate your turnaround times. Underpromise your results. When you surpass their expectations, you have instantly given yourself an extremely strong marketing tool to launch your business into a success.

Step Five: Ask clients to leave you reviews and testimonials

It may seem like an obvious tip, but clients will generally not leave reviews unless you ask them to. We are naturally programmed to share our negative experiences but not to say anything when we get exactly what we expect.

Clients who purchase from a new online business are just the same. After you complete a job, ask your clients to leave reviews or testimonials. This can be on your Facebook page, through LinkedIn recommendations, your website, or on various review sites you may have registered for.

You may even want to offer a small discount or a bonus to clients who are willing to leave reviews or send more business your way. 

Step Six: Stay on top of your finances

Open up a business checking account as soon as possible. Keeping track of your finances is tough and you don’t want to risk losing track of it. This can not only cause tax filing problems it can cause disaster when it comes to financial planning.

Keep track of all income and expenses. Review them regularly to ensure your fees are covering your expenses.

It is also good practice to review the hours you spend working each day, as well as how much of that time is spent actually being paid for what you are doing.

Finding the right balance between service pricing and your needs is one of the greatest challenges business owners have, but by going through the above process on a regular basis you can ensure both you and your customers are getting a fair deal.

See Also: Tax Tips for Filing Taxes When Self Employed

Step Seven: Educate yourself on being a business owner

The most successful entrepreneurs are those who are willing to learn and keep learning. 

If you decide to fully commit to running a service-based online business for the long term, educate yourself about the responsibilities of being a business owner. These include your obligations, such as insurance and licenses, as well as any filing responsibilities you have with your state.

Granted, you do not have to do this from day one. The majority of online business owners tend to test their ventures for a few months prior to doing everything by the book, but make sure you do, or you could be liable to significant penalties.

Bonus: Tips for getting your first few clients

The biggest challenge new business owners have is securing their first few clients. Here are some ways you can find your first few clients to jumpstart your business: 

  • Reach Out to Friends and Family – The easiest way to get started is to bother your friends and family. You may be surprised at the number of people close to you who are willing to help you get those first few reviews.
  • Professional Contacts – Get on LinkedIn and get in touch with some of your former coworkers and clients. You may be able to offer them a great deal on services they need and already purchase. This is a simple way to build a client base from scratch.
  • Find Local Businesses – There is an increasing emphasis on building local communities by staying local. Many business owners are eager to support their communities for marketing purposes and so they are willing to work with small businesses. Cold call some local businesses and pitch yourself.
  • Build New Online Connections – Start building new online connections. Visit online forums relevant to your online business, get involved in relevant Facebook groups, and start building your authority in relevant subReddits. 

You can start a service-based online business this year and make money from it

The chaos of the coronavirus pandemic has revealed huge gaps in businesses across society. For people who are considering online entrepreneurship, now has never been a better time to make those dreams happen.

You have the potential to fill the gaps left by those who were wiped out by the pandemic. Plus, with an expected boom in entrepreneurship, this means there is only going to be greater demand for what you have to offer.

What type of service-based online business do you want to establish?

How to Start a Service Based Online Business AND Make Money From It


  1. Catalina says:

    I think now it’s the best moment to start an online business or to go online. Thanks for these tips!

  2. Anosa Malanga says:

    My friend has just started her online marketing business. Indeed there are so many ways to still earn even we had been experiencing a pandemic. She turns our problem into an opportunity to establish a business on her own.

  3. Ghanashyam K says:

    These are some great ideas. I really do want to start making money from home.

  4. Nile Flores says:

    My kid has been getting into social media and some graphic design, and he’s just a senior. This COVID pandemic has made it hard for him to get a job, so his dad and I helped him get a few local clients to start off. I’ve been coaching him on how to approach more clients online and even in person.

    Eventually, as he builds his portfolio and experience, I may even offboard some of my social media work to him.

  5. Bolupe says:

    I started my service-based online business recently and your tips are so useful. I find marketing to be the key game-changer but it takes time to build.

  6. Marysa says:

    It would be great to own your own online business. I get frustrated micro managing other people, and I have thought about doing this.

  7. Katie says:

    You have listed a lot of great practical ideas. I think another important objective for beginning an online business is to have the drive and passion to keep momentum.

  8. These are some great tips. I love being able to be home and make money. It has been very rewarding for me.

  9. Great information for those who want to start an online business. I’ve been doing this for 10+ years and you have great suggestions.

  10. catherine santiago jose says:

    This is definitely a great post and it’s very informative. The detail on this post is on point, thanks for sharing such a wonderful article that everybody could use and be familiar with.

  11. Lynndee says:

    I would love to have my own small business someday. Thank you for the tips!

  12. MELANIE says:

    This is a really great, informative post. I think that more are looking to earn money online now.

  13. Nikki Wayne says:

    These are really helpful business tips.
    I will keep these in mind.

  14. Chef Dennis says:

    This is really beneficial especially for those who want to start an online business! I will share this with my friends.

  15. Great advise! Offering online services can be a great money maker if done correctly!

  16. Sheryl says:

    This pandemic really affected most of us financially and starting a business we could do in the comfort of our own home really helps.

  17. melissa chapman says:

    This was apost that really had some interesting information. I have run my own blog/business but these tips were very helpful

  18. Amber says:

    These are some great ideas. I always like when I can find ways to earn more money.

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