Digital entrepreneurship is about starting and running a business that operates fully online. It represents a new model of entrepreneurship tailored to the digital era in which we live. Well-known examples of digital entrepreneurship include e-commerce platform Shopify, software-as-a-service (SaaS) company Slack, online house-sharing marketplace Airbnb, and AI innovator OpenAI.
All these businesses use technology to deliver their digital experiences to customers around the world, 24/7. As big as these companies are now, they all started out small. So, you don’t need to be a billionaire diamond heir to jump into digital entrepreneurship. For example, Sara Blakely built Spanx into a billion-dollar shapewear empire by selling online first before expanding to retail. Ben Silbermann co-founded Pinterest and led the visual discovery platform to over 400 million users globally. Michelle Phan leveraged YouTube to launch a beauty and makeup line that was acquired by L’Oréal.
Benefits of Digital Entrepreneurship
Digital entrepreneurship offers numerous advantages, making it an appealing choice for many aspiring business owners. One of the key benefits is access to a global customer base. The internet allows you to reach a worldwide audience, surpassing local constraints. Additionally, digital tools and platforms, such as ecommerce websites and social media, provide smaller businesses the capability to compete with larger companies. These tools level the playing field, enabling effective marketing and sales without the need for a substantial budget."
Digital technologies have created countless new avenues for entrepreneurs and small businesses. Whether you're an inventor, a writer, or an artist, you can use the internet to reach a massive audience and get your next big idea off the ground.
You can even use tools like ecommerce marketing and social media advertising to help increase exposure and reach more people. This is known as digital entrepreneurship.
Digital entrepreneurship is one of the biggest types of entrepreneurship in today's world. Just about every business has a website, and lots of people manage a website even if they don't have a digital business.
Successful Examples of Digital Entrepreneurship
Digital entrepreneurship is about starting and running a business that operates fully online. Notable examples include:
- Shopify: An e-commerce platform that empowers businesses to create their own online stores.
- Slack: A software-as-a-service (SaaS) company that revolutionized workplace communication.
- Airbnb: An online marketplace for house-sharing and rentals, connecting hosts with travelers worldwide.
- OpenAI: A trailblazer in artificial intelligence, providing cutting-edge AI solutions.
These companies started small but have grown significantly by leveraging digital technologies to deliver their services globally.
You can start up a blog to talk about one of your hobbies, a website where you can share your fishing videos or even a portfolio of your work. When it comes to starting a digital business, the possibilities are endless.
Before you start an online business, there are some things you need to know about digital entrepreneurship and how to be a digital entrepreneur. Succeeding in the digital business world isn't as simple as building a website; you need to have a digital business strategy and understand how to navigate the internet and use its power to your full advantage.
We'll help you learn about what you need to do to start a digital business and become a digital entrepreneur. Keep reading to find out more about digital entrepreneurship.
What is digital entrepreneurship?
Digital entrepreneurship involves leveraging the internet and digital technologies to create and run a business.
Unlike traditional entrepreneurs who are limited by geography and resources, digital entrepreneurs can reach a global audience and utilize cost-effective marketing strategies.
Tools like website builders make it easier and more affordable to launch and grow a digital business, making it an ideal path for those with limited resources.
Is digital entrepreneurship on the rise?
As the internet continues to grow and become an increasingly major part of our lives, new opportunities for digital entrepreneurship arise. Digital entrepreneurship is constantly growing in popularity because it's such a great way for people to start a business. Online businesses give entrepreneurs the potential to reach a digital marketplace they couldn't do without the internet—and there are even business opportunities that are unique to the online world.
There are also helpful tools for digital entrepreneurs, including data tracking and digital advertising. The more people find ways to make money online—whether that means streaming video games or starting a store—the more digital entrepreneurship will continue to grow.
Benefits of being a digital entrepreneur
When you're starting a digital business, you've got a big decision to make in terms of starting an online business or a brick-and-mortar business. There are countless benefits to being a digital entrepreneur, especially if you lack resources.
Arguably the biggest benefit of digital entrepreneurship is the cost. As long as you can afford a domain name and website hosting, you can get your website off the ground. Your business will likely attract more customers if you invest in lead generation and advertising, but that's not something you have to do. Simply creating quality, shareable content can help you build your online brand.
Attracting more customers to your brick-and-mortar store can be tough. You can get the word out around town and host special events, but that doesn't guarantee people will show up.
With online businesses, you have access to tons of marketing tools that allow you to reach a wider audience. With internet users spanning the world, digital marketing can really expand your reach.
Drawbacks of being a digital entrepreneur
While digital entrepreneurship is perfect for some people, there are a few downsides. Perhaps the biggest problem with digital entrepreneurship is that it may require advanced skills.
Unless you have a lot of money to invest in marketing, you need to learn the basics of marketing and growing your website. You also have to learn how to build brand loyalty and keep customers around, which can be tough when you're not interacting with your customers in person.
There are also unique challenges you face as a digital entrepreneur. If you run a digital store, you need to follow regulations regarding how you collect, store, and use data. You also need to protect your business against cyberattacks, and you need to invest in ecommerce business insurance.
For some people, facing these challenges can be overwhelming and a barrier to entry into digital entrepreneurship.
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What skills do you need to be a digital entrepreneur?
Digital entrepreneurship is a great opportunity as long as you have the right skills for the job. From marketing to using customer retention strategies to keep your customers around, here are some of the skills you need to succeed as a digital entrepreneur.
You have knowledge, expertise, and passion in something
Above all else, you need to have something you're passionate about or knowledgeable about. If you simply hop on the next big trend, you're going to be competing with everyone else who decided to do the same thing.
Instead, you should look for a niche that you care about and can add value to. That way, you have something that separates your business or product from competitors.
You’re able to do most of your work remotely
Remote work is what allows digital entrepreneurs to reach a wider audience using fewer resources. If you want to be a digital entrepreneur, you should be able to do most or all of your work remotely. It helps to have a dedicated office space in your home; that way, you've got a place to work in peace and store any business-related paperwork.
You can make online sales
For online businesses, success is all about making online sales. Whether you sell a product or a service, the quality of your product doesn't matter unless you can convince people to buy it.
A good digital entrepreneur knows how to make online sales, and that doesn't mean simply posting listings on eBay. The better you understand the sales funnel and how your tone and content can drive sales, the better off your digital businesses will be.
You can do online marketing
Building a website and launching your business is one thing, but succeeding is a different story. Digital marketing is an essential part of succeeding as a digital entrepreneur, so you need to at least have the resources to invest or be willing to learn the basics of digital marketing.
Your website, the content you create, and your social media posts all play an important role in digital marketing.
You’re prepared for risk
Many online businesses don't succeed, so you shouldn't start an online business if you're not prepared for risk.
Starting a digital business is more affordable than a brick-and-mortar startup, but you still have to invest. Be prepared for the possibility that you might have to pivot to another business idea or take a loss on your investment as a digital entrepreneur.
How to start your online business
With all the resources available online, starting a digital business has never been easier. Here are a few basic steps you can follow to start your digital business and get things rolling.
1. Understand whether your product or service is in demand
Demand varies depending on what you're trying to sell, so make sure you do some market research. You don't want to sell a product or service that's not in demand, but you probably don't want to opt for the highest-demand products or services due to market competition.
2. Create a business plan
Once you know what you're going to sell and you've researched it to make sure it's in demand, it's time to write a business plan. If you don't know how to write a business plan, you can use a business plan template or business plan creator.
3. Acquire funding
Acquiring funding is different for every digital entrepreneur. If you're building a basic website to sell a service you can provide, you can probably fund your own business. If you're going to invest in inventory or spend big on marketing, you may want to acquire funding through venture capital, crowdfunding, or a small business loan.
4. Build a website
Now that you've got your funding, it's time to build a website. For this step, you have your choice between building your own website or hiring a professional. If you can afford it, a custom-built website will help separate your business from the competition.
5. Start marketing
Once you've taken care of the basics, you can start your mission to boost your brand. Digital marketing can involve social media marketing, YouTube content and advertising, blog posts, and more. The more effort you put into digital marketing, the better results you're likely to see.
Digital entrepreneurs need the right tools
Digital entrepreneurship is a great way to start a business, but you have to make sure you're prepared. Every digital entrepreneur should have the basic skills we talked about earlier, but you also need to have the right tools.
Mailchimp offers a suite of digital marketing tools to help digital entrepreneurs and small business owners like you reach a larger audience. With a website builder, email marketing tools, and more, Mailchimp is the simple solution to building your brand.