I wanted to share some reflections and lessons about my young online entrepreneurship. I don’t want this to be one of those posts that promise to add value but then say nothing, I want to be honest and concrete about my experience. Maybe someone, also with an online service business, can find something useful or motivated in what I tell.
But first, let’s put it in context: for a little over a year, I’ve been making websites and visual identities online, as a freelance digital nomad. Before I started entrepreneurship I always worked as an employee, so I have never had to think much about issues such as sales, business growth, process optimisation, taxes, etc. Besides, although (as a good generalist) I’ve played a lot of different roles and industries, none of them really related to what I’m doing now.
So, you can imagine how crazy and chaotic this first year has been: training, working for clients, creating my own website, etc. To that, I have been travelling around Mexico and Nicaragua. When I came back to Spain, after 9 months trotting around the tropics, it was with the notion that I had to get my act together, structure this business and lay the foundations for stable and sustainable growth, so I started doing service business coaching sessions with Hoolistic agency and these are some of the reflections/lessons.
1. Understand what the differential value is that you provide
It is important to know what differentiates us and to be clear about the value we bring and how our service differs from other similar services in the market. In this way, we can focus on promoting those characteristics and achieve a competitive advantage that allows us to sell sustainably and consistently over time.
When I’m not surfing or climbing, I create strategies and design online communication elements for outdoor sports companies (no-code websites and visual identities). My mission is to create an online presence for surf schools, climbing coaches, mountain guides, etc. that does justice to their activities and the places they take people to.
2. Be observant, reflect and pivot if necessary
Being observant and reflecting on the first months of business is important because it allows you to evaluate what has worked (and what hasn’t), which is fundamental to making adjustments and improving the strategy to follow.
In my case, for example, one thing that worked from the very beginning was word of mouth. This combined with travelling has brought me the most work. On the other hand, what hasn’t worked for me has been the networks, both organic and paid traffic, and although I don’t rule it out I think I’m going to put more emphasis on optimising the SEO of my website and on different channels of attraction.
Another issue that I have reflected on and pivoted on has been my services. In the beginning, I also offered work in social networks as a community, but after a few months I realised that it is a very demanding area, I didn’t see that people were willing to pay for it and they expected immediate results. Moreover, the results they offer are disproportionately low compared to the effort it takes to increase the audience. Website design and creation appealed to me more and I found it more satisfying. That’s not to say I’m ruling it out completely, as I want to be able to offer a complete solution to my clients, but I might consider delegating networking if the need arises on a project.
3. Incorporate the pillars of differentiation into your growth strategy
Remaining in a state of autopilot, focused solely on (day-to-day) client work is dangerous, as scaling requires a clear intention, defined objectives and set timelines. Although growing a service business is not as easy as a SaaS or e-commerce, especially when you want to offer tailor-made services with a personal touch to each client (as is my case) there are ways to achieve it. Knowing the 4 fundamental pillars of differentiation has given me some ideas:
1. Proprietary technology or proprietary methodology:
The most successful businesses are those that develop proprietary technology or those that “package” their way of doing things (know-how) and create a methodology or process. In addition, they also use technology to further expand these processes.
Although I do not yet have an identified method, I do not rule out that as I continue to work with the niche market I am in, I may discover what the common denominator of most of them is and create a method that applies to a large number of them. But as of today, I have not yet identified it.
2. Network effect for an online service business:
My business becomes more useful as more people use it. Building a network is complicated and time-consuming, but it is based on the most important thing a person can give you: trust. It is important to understand that the network must be profitable for every user that forms it, including the first one.
This point is key, as I have seen how it has elevated many online businesses. From what I have observed, this is mostly in the form of a community. I’ve seen many businesses create communities in Facebook groups, Telegram, MeetUp, etc. I’m part of several myself, so I understand how hard it is to create a quality community and maintain it. But when it works, it’s amazing the strength and inertia it exhales. At the time I thought it would be interesting to create a bridge between entrepreneurs from Central America and Europe in the surf and beach tourism sector (“Work in Progress”).
3. Economy of scale:
Your business, to be strong, must generate more profit than expenses. As income increases, it must be distributed among the expenses, so that growth means increasing profits. If not, any bad moment can shake the company.
Among the medium-term objectives I have identified are: improving the efficiency of the business (optimising processes and delegating), meeting people and working on the own brand. Obviously, I would also like to grow profits, and I believe that this will happen if I focus on the above points. Tools like Toggle, help me to see the hours I dedicate to each project and therefore to understand how much I work (or don’t work), and how profitable each project, task, etc. is.
4. Branding, in an online service business:
All aspects of your business must differentiate you and be unique. You have to reserve energy to improve your own brand and your online presence, because, even if it is not the strategy that brings you, clients, today, it is the one that works in the medium and long term. Creating a recognisable brand and style is key, but it is dangerous to start focusing on branding alone. If you do this, you’re putting the cart before the horse.
In my case, for example, the social network where I spend the most time and generate the most content is Instagram. Even though, as I mentioned before, the return is pretty basic or I’m going to stop posting on it, because, in the long run, it’s a way of working on my personal brand, as I upload a lot of things about my travels and the sports I do. However, for an Online service business, I think it would be a waste of time to focus all my efforts on growing my account under the false premise that the more followers the more clients you can get. This is a bit like putting the cart before the horse, isn’t it? There is a time and a place for that.
Conclusion for an online service business
In conclusion, the coaching so far has been a good way to help me order my ideas and plan a sustainable growth path for my business. I believe it is crucial for anyone who wants to make a living online to be clear about their differential value and to set goals and take actions that will help them not only in the short term but also in the long term. My examples are just, personal experiences, but I share them in the hope of inspiring and helping others. To keep travelling it is important to have some stability and well-established processes, otherwise what should be an extraordinary experience can quickly turn into a stressful and unpleasant experience.