LESSON #8: Things needed to start an online business

By | June 27, 2008

We’ve talked about whether you’re the right kind of person for an online business, and whether it’s the right kind of business for you. So today let’s talk about what resources you need to have if you want to start an internet business.

Is it as simple as having an internet connection and a desire to succeed?

(Watch this video…)

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Main points:

(Note: for your convenience, there are links within the list below for things I recommend, some of which are my affiliate links)

What you need…

1) A computer

-Doesn’t need to be the latest and greatest
-Can’t be a total dinosaur
-Recommend Windows XP or newer
-Consider a laptop
-spend $200-$1000 for a desktop, $400-$1500 for a laptop

A few places to shop for a computer:
HP Shopping (where I bought my computer and my laptop)
Buy.com (I’ve bought a lot of stuff there including backup hard drives)
Amazon (A good place to compare prices and look for specials)

2) Internet connection (Broadband recommended). I used Qwest DSL (Now CenturyLink) for many years, and they were been good. I then used Comcast broadband for a few years, and loved it, as the speeds were much faster. Now I live out in the foothills, with no DSL or cable available, so I use Skybeam, which is a wireless Internet service. The speeds are not blazing, but it’s good enough for my business, and fast enough to stream Netflix too. If you live in an area not serviced by a major provider, you might want to look into something like Skybeam, or satellite broadband.

3) Antivirus program. I use AVG; their website is www.avg.co.uk.

UPDATE: I believe AVG is still good, however I think there are some better ones. On my main PC, I’ve switched over to Avast, which is also free:
http://www.avast.com/free-antivirus-download

And on my laptop I’ve switched to Microsoft’s free progam:
http://www.microsoft.com/Security_Essentials/

4) Email (free options available). For example: http://mail.google.com/mail/signup

5) Zip program (free options available). This is a good freeware: www.7-zip.org

6) Productivity software (free option available). Here’s a good free option: www.openoffice.org

7) Startup capital (highly recommended). I recommend having at least $200 available.

8] Credit card (highly recommended). If you’re afraid you’ll abuse it, you might want to consider a prepaid visa card.

9) Paypal account (highly recommended). You can get a free account at PayPal. If you live in a country that PayPal doesn’t allow, read this article for inspiration.

10) Business checking account (highly recommended).

11) Business registration (requirements vary – might be optional).

12) Business Entity such as an LLC (Optional). In general, you can probably start as a sole proprietor, and decide later if you want to form an LLC.

An LLC may help save you from paying self employment taxes. It also can protect your personal assets. Consult with an attorney or tax accountant.

If you want to avoid paying an attorney to help with the paperwork, you can often do it the cheapest directly through your state department. I’ve also found LegalZoom to be a helpful shortcut. I’ve used them to form three LLC’s, one non-profit, and two wills.

13) Accountant (Optional).

14) Lawyer (Optional).

15) Telephone (Optional). If you have broadband, you might want to consider Skype for your phone service.

16) Insurance (Optional).

17) Backup drive (Highly recommended). I added this one after making the video. A decent external hard drive can be purchased for $100 – $400. It’s not so important what kind of drive you get; what’s important is that you use it to backup all the files on your computer on a regular basis. I’ve bought several hard drives (including Maxtor, Lacie, and Western Digital) from Buy.com with good results.

There are a few other things that you’ll need which will be specifically covered in upcoming lessons, so don’t worry about them for now.

Action steps:

1) Go through the list, and make sure you have everything that is required. For the highly recommended ones, do as best you can to get them. For the optional ones, do some research and decide whether it’s something you need.

As I mentioned back in lesson 3, you don’t need to be a computer expert, but there are some things you’ll need to know. I’ll go through those basic computer skills in the next lesson.

As always, you are welcome to post your questions and comments below.

Have a great day!

388 thoughts on “LESSON #8: Things needed to start an online business

  1. Micah

    Hello Juliana,

    A prepaid Visa will be accepted as payment many places, but PayPal will give you even more options. You can make purchases virtually everywhere, and even have backup funding sources, such as a checking account, or other credit cards.

    A PayPal account is also a great way for you to be able to receive payment, if you decide to start selling anything online.

    Reply
  2. Tracy

    Once again, Great lesson, Looks forward for the next one. I have one question: Credit card , Can it be debit card from the business account? Instead of using as debit card, I can use it as Credit Card?

    Reply
  3. Micah

    Hello Tracy,

    Yes, a debit card should work the same for you, when you want to make online purchases.

    Reply
  4. Mosidi

    Hi Eric,
    I was really looking forward to the next lesson.I have a desk top computer which is a little slow.
    My daughter is home for the christmas holiday and she brought her laptop with her, so I have been taking advantage using it.

    Tomorrow I will be using my slow PC as I can’t afford a new PC at the moment.

    Anyway to cut a long story short is that I am enjoying the lessons and I want to keep learning.So please email me my next lesson.

    Reply
  5. Abdulla Afeef

    Mr. Eric.
    Indeed I believe that every step you offer is highly valuable.
    I Inform you that I have some things you have recommended. But have a slow laptop to use.
    Is a papal account possible to use as business checking account.
    Any way I’ll try as hard as I can to fulfill all of your recommendations.
    Thanks and best regards.

    Reply
  6. Cleuza

    Thank you!
    I have learned much, despite the language barrier. I am Brazilian and not very well mastered English. Even so, I have learned a lot.
    As for antivirus, I use the essential Windows and also avast. There is no conflict. I chose avast paid because of the safe zone, which isolates your navigation when you want to do any banking transaction, or need to provide some information confidential. Even if someone has managed, somehow, remote access to your computer in safe zone, you’re out of your IP. No chance for hakers malicious.

    Reply
  7. Jack Cook

    Thanks Eric…I’ve must of learned something over the years. I have all of the components!
    Jack

    Reply
  8. Ethel

    Hi Eric –
    This lesson tonight made me feel so good. I thought I was really not computer savvy! Almost everything in your list is already in place. I depended so much on my husband on all my computer needs. I didn’t have to do anything until he died of massive heart attack last summer. I felt so lost. Slowly I accepted help from other people and just now I discovered I have everything that you required including the optional ones. So, I thank you for “telling” me I can now go on without my husband as I have everything here that he installed. Now with you being there explaining the steps patiently especially with your to do list, we will be all right.
    Thank you.

    Reply
  9. Alice Mafabi

    Thanks Eric. I have asked enterpreneurs over and over again to give me an estimate of how much I need to start the least and easiest online business to a point of making a dime and end up with no clear answer. This has been a problem to most interested persons, not knowing what is needed. Thank you for this valuable advice. At least I have a clear view of what I have to work on to succeed. Thank you.

    Reply
  10. Anonymous

    THANK YOU
    I DID LEARN TO MUCH FROM YOU TODAY,
    AND I WANT TO TELL YOU SOMETHING FROM MY HEART, YOU SEAM LIKE DECENT FELLOW AND HONEST NOT LIKE OTHER MARKETER OUT THERE. THIS MAKE A DIFFERENT FOR THIS BUSINESS

    Reply
  11. Anne

    Hi Eric,
    I really appreciate the information that you are giving. I am interested in affiliate marketing and I am very eager to start but I have limited knowledge and I do not have a website. Would you be covering websites in your lessons or should I go ahead and get one immediately? If I should get one now can you advise on the best and cheaper web hosts? Thanks again for all that you are doing and the invaluable information, I am really looking forward to the other lessons to start my online business. God Bless!

    Reply
  12. Rodney

    Thanks Eric,
    Lesson #8 was a great checklist. I’ve got everything I need to really start digging into my business. Can’t wait for the next lesson. Speaking of the next lesson, is there a way to access these lessons to watch them at a different pace? Honestly, the waiting is killing me… Rodney

    Reply
  13. Micah

    Hello Mark,

    Some internet marketing tools are created for Windows-only machines. But, there are still plenty of tools to help you as a Mac user.

    You can be a successful internet marketer, working from a Mac.

    Reply
  14. Micah

    Hello Alice,

    A realistic minimum investment for an online business would be about a couple hundred dollars, for web hosting, a domain name, an autoresponder service, and a product to start selling.

    However, there are many different ways to earn money online. Here is Eric’s lesson highlighting 18 different ways to earn online revenue:

    LESSON #4: 18 Ways to Make Money Online

    There are also free methods for running your business as well.

    Have you checked out Eric’s recent product, the No Cost Income Stream?
    http://nocostincomestream.com/invitation/

    It sounds like it would be a good fit for what you are looking for.

    Reply
  15. Micah

    Hello Garland,

    Yes, Powerpoint is a great tool to have when creating your sales videos.

    Reply
  16. Jacqueline

    Thank you so much for the lessons. I am not sure about backing up info, I hope there is a video on it. I will also do some research. Thanks.

    Reply
  17. Jon

    Hi for some unknown reason I can’t access lesson 8??? Cache cleared and history.

    Reply
  18. Charles Fountain

    Re:Tip8 Grandpa – right on man – right on.Thanks
    current 83 and rolling! May I be no:2 ?
    ERIC: As always, thank you. No bull,sharp,factual,to the point.Touch of the military?
    Based in UK/Europe. Your LLc structure. Complicated, or should I aim for that geographical area only? Advice please. Watch the mozzies!! travel safe.

    Reply
  19. Eric Post author

    I’m not too familiar with business licensing in the UK. But generally, you don’t need to worry about anything until you’re making money, then you can talk to your accountant or tax professional.

    Reply
  20. Johann

    Hi Eric!
    Thank you for the informative video! I do appreciate the fact that you are showing me from the very basics, upward, what to do and not to do!
    You really are a blessing!

    Waiting for the next lessson with great expectation!

    Thank you and enjoy your day! Blessings to you and your family!

    Johann.

    Have a day full of WONDERS!!!

    Reply
  21. David Vick

    Eric I’m liking these training videos. My question is or might be irrelevant to these videos, what do I do with all the files that I downloaded when I first found out about the real guys nocost income stream? This seems to be a training system as well & if so what do I follow, your tips or NCIS?

    Reply
  22. Eric Post author

    I would suggest choosing one course or the other to start with, so that you don’t get overwhelmed. NCIS is designed to start with zero startup capital. Really that’s not ideal, but since so many people are in that situation, that’s why we created the course. If you do have a couple hundred dollars to invest in starting your business (mainly for domain, hosting, and autoresponder service), then I’d recommend sticking with my lessons.

    Reply
  23. Charlie

    Iam lovein this i have bin searching for the right thing for a few years now so going threw your training is a dream come true

    Reply
  24. Bev Barraclough

    Thanks Eric- for so much very good information- wish I had known many of these things sooner before I wasted money and time. great to have it all made so clear.

    Reply
  25. timothy

    hi there,
    i just want to extend my gratitude to Eric for the splendid tips.

    Reply
  26. Hariata

    Thank you, Eric! Yep, I’m pretty much good to go with this list of things to do and have. I have one question: would you consider using a cloud to backup your business information?

    Reply
  27. Bill

    I have a home hard drive,will this be big enough to download these tools?If it is not,then how could I make room for these tools that I am going to need?I have Comodo which has done very well for me,they have a free download.I don’t have the support yet because at the moment I am not able to afford it.What questions would you ask to find a good honest attorney. From Texas

    Reply
  28. Carol Pilkington

    I used Avast then switched to AVG. Avast constantly interfered with Java. Whenever I tried to join a webinar it appeared that I was having a problem with Java. It was driving me nuts for months as it was interfering with using different browsers as well where Java was needed. When I disabled Avast everything operated beautifully. I dumped it in a NY minute. I’ve been using AVG ever since and haven’t had a problem.

    Reply
  29. Dan Merryday

    Interesting list of resources necessary to start an online business, Eric.

    Particularly, I am interested in sole proprietorship or LLC, since I notice many internet marketers who go on to become highly successful marketers create their own LLC (especially if they decide to make their own product).

    I have to check with my national law here about sole proprietorship, since I don’t even live in the northern hemisphere. Hopefully I can find the safe and secure legal method that doesn’t cost an arm and a leg!

    Cheers,

    Reply
  30. bob

    In this lesson Eric said he has been using a laptop for 5 years that he has had since 2000. That tells me this lesson was created in 2005. It’s now November 2013 are any parts of this lesson outdated or information added in later lessons?

    Reply
    1. Eric Post author

      Hi Bob, Most of the content is evergreen. There are some lessons that I’ve updated over time, and the lesson series has taken me over 5 years to create (and I’m still working on it), so the later lessons are recent. So it should all be good. If there are certain links or anything that you notice need to be updated, just let us know at my helpdesk and we’ll take care of it. Thanks

      Reply
  31. Roxy

    Great lesson Eric, wasn’t sure about the legal stuff. I’ve hear not so great stuff abt paypal, but still gona try it

    Reply
  32. Humberto

    Hello Eric, how are u doing matie! The Flying Dutchman here hihi! Haha sorry am just 19 and still childish, Well it was a very rich session of information….alot of valuable tips….thank u sooooo much, I am pleased to be one of the lucky ones here who has the possibility to step into this amazing and exiting journey we have ahead of us! Thank u so much and in the near future i believe we will meet someday hihi!! Up to session #9

    Best Regards
    Humba

    Reply
  33. Rainer

    I have a webinar about downloading firesale in my e-mail, but I’m still on Eric’s tip’s lesson 8
    is this webinar for people in the upsale ?

    Reply
    1. Micah

      Hello Rainer,

      The webinar link should be on your download page now! All customers have access to the bonus webinar.

      Reply
  34. Rainer

    is there a lesson every day? or is there a way to speed up the lesson and start a online business? because I think I am behind here.

    Reply
    1. Micah

      Hello Rainer,

      The next lesson will be sent to you soon. You can also visit the following link to see the latest lesson updates and revisit earlier lessons:
      http://www.ericstips.com/tips/category/lessons/

      Here is the direct link to lesson 9:

      LESSON #9: Basic Computer Skills You Need to Have

      You may also simply change the number at the end of the link, to go to a different lesson number (example: /lesson1, /lesson2, /lesson3, etc…).

      If your email happens to block some of the lessons, we recommend that you view this tip on whitelisting an email address:

      How To Add a Sender to Your Whitelist (Safelist)

      Reply
  35. PETER KAMAU

    Hi Eric, thank you for the great and amazing tips. This is a different approach to starting an online business. Its a clear indication that having a business online is a process not an event.

    Reply
  36. Grenell Stocks

    This is very informative. Very clear as to what exactly I need to begin my business

    Reply
  37. David

    Hi Eric,
    You have some pretty good information here. I would like to see more time spent on setting up a business properly and making it all nice and legal to avoid problems later on. What I did notice is that you completely forgot to discuss choosing a proper business name. Something to consider is if a person wants to use their own name or go with a fictitious business name (i.e., Sunshine Pet Supplies)? There are pros and cons to using either method. There are definite requirements that must be followed on a county and state level (within the U.S.) when creating a business. Also missing was information on setting things up to pay any necessary taxes, whether they be city, county, state or federal. To me, establishing the proper business foundation is one of the most challenging aspects to starting and running a successful business. Unfortunately, almost all Internet marketers I see completely gloss over this critical aspect and jump immediately into finding a niche and a product to sell, etc. Without a firm foundation to build a business upon, it does not take much but a gust of air for a house of cards to come crashing down. One final point, newbie entrepreneurs in the U.S. can find the closest Small Business Administration office to them and then utilize a function of it called SCORE. They provide lots of very valuable information, classes, and counseling to individuals starting new businesses. A lot of what they provide is FREE or very low cost. Well worth the effort to have consultants available that can help individuals get themselves starting out in the right direction.

    Reply
  38. Wayne King

    Information has be helpful. Thanks.

    I was interested in your Missionary Trips. Would you share the agency you went under?

    Be blessed and be a blessing

    Reply
  39. Nuno

    Hi Eric! I’m liking this lessons and i’m following the NCIS 2.0 videos at the same time. About today’s lesson, i have the following questions:
    1. for starting with affiliate marketing do i need to create a business entity?
    2. sole proprietor is a business entity?
    3. what’s the difference between creating a Business entity and a business registration?
    4. Can i register a business entity and don’t do the business registration?
    5. A business bank account is just as a personal account or does it have different conditions, costs and requirements?

    Reply
    1. Micah

      Hello Nuno,

      If you are merely promoting items as an affiliate, a sole proprietorship is fine in the U.S.

      If you plan to build your own business, you might want to look into starting an LLC.

      Depending on your bank, you might have different features available to you between business and personal accounts.

      Reply
  40. beata

    I started receiving lessons from erictips.com and I love it . This site is very informative and Straight to The Point!!! Thanks Eric!

    Reply
  41. Alonzo Cromer

    I have lost a lot of money trying to start online businesses, but this course has really given me confidence that I can be successful. In addition to this awesome knowledge, I was inspired even more after reading the book “Cashflow Quadrant. I am shaking my fears and paranoia from past experiences to get a new grip on this information and move forward. Thank you Eric

    Reply

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