Virtual Business Success

Dear StartupNation : For months I’ve been fine-tuning plans for my new business. Considering available funds (modest), time (don’t have much) and talent (spread around), the model most likely to work is to operate as a “virtual business.” In other words, everyone will work from their own space and we will use technology to link up. Where can I find support services for a virtual venture?

The virtual business phenomenon, pioneered by entrepreneurs like you, is transforming how millions of small, successful firms operate . Under the virtual model, business owners outsource nearly everything - including people and partners who may be anywhere - to start a business.

The technologies and services to tie it all together are becoming more sophisticated, but less expensive all the time, helping fuel the move to virtual existence.

After eight years working for other public relations agencies, John Jordan launched his own Washington, DC-based firm, Principor Communications, as a virtual business in 2002. His main reason: to kill the high cost of office space and everything associated with it. His biggest savings, however, have been on labor. “The skilled, experienced professionals who staff my agency are all independent contractors,” he says, “including women at home raising young children.”

But while the absence of a traditional office might change how you manage people, it doesn’t eliminate the need for doing so effectively, notes Jordan.

On the other hand, certain businesses may outgrow operating virtually, such as in the case of ClickZ.  Andy Bourland and Ann Handley founded the internet publishing firm ClickZ in 1997 as a virtual business operating from two spare bedrooms. The firm was started with a few barter deals and a low-balance credit card but reached $3 million in revenues. Bourland says the real challenge was not turning a profit, but rather staying in touch, and the partners found the virtual business model inefficient.

Eventually, the distractions of working from home and the increasing difficulties in linking virtual components became too much and they rented office space. Within 18 months the business grew from five to 25 people and was acquired by Internet.com.

Staying connected and working in unison are vital to virtual success

  • Tap the latest technology to keep everyone in touch. Cell phones, e-mail, follow-me-anywhere messaging and intranets or shared workspaces on the web can work wonders.
  • Foster trust and bonding between the individuals involved. When people interact only electronically from remote locations, this becomes even more important. Talk by phone, use web conferencing and try to meet face to face on occasion.
  • Leverage the strengths that a virtual business affords, including flexibility (offer short turnaround); low overhead (keep costs lower than the competition) and competence (tout the credentials of your virtual partners).

Our Bottom Line

If you’re ready to venture but you want to venture virtually, there’s nothing standing in your way. Just be sure as you head down the path to vritual business success to put technology to work and pay extra attention to communication between team members.

© 2005 BizBest Media Corp.

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