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I receive many questions via email every single day but my #1 most asked question is…
How long do you think it will take for me to make money with my business?
Here’s another common permutation of this same question…
I need to be able to make money in 6 months, can it be done?
Photo By Eschipul
And finally my favorite…
Can I expect to make 100K in the first year with my online store like you did? One year ought to be enough runway right?
So here’s the truth.
Brand new entrepreneurs are horrible at predicting how far they can get with their businesses in the short term.
In fact, they often grossly overestimate how much money they can make in their first year. But on the flip side, they also grossly underestimate how much they can make in 3+ years with their businesses as well.
So anytime a reader or a student asks me any of the above questions, I immediately start to question their commitment and how serious they are about starting a real business.
Why? It’s because when someone asks me how much they can make in 6 months, it usually means that they are only willing to stick it out for 6 months to see if their business idea has a chance. This is not enough time!
Starting A Business Requires Long Term Thinking
Starting a business takes commitment. And I don’t mean a year or a few years. When I say commitment, I’m talking about giving it a go for at least 3-5 years.
When my wife and I started our online store, we were in it for the long haul. Although we set a goal to make 100K before the baby arrived, we were ready to work at it and keep the store afloat indefinitely until we got the formula correct.
If we didn’t have this mentality, we might have quit at 6 months because sales were not where we wanted them to be.
We weren’t convinced that the store could ever make enough money to supplant my wife’s income.
We didn’t believe that our market was large enough. We didn’t think that we could crack the first page of search to get the necessary traffic.
What’s funny is that we started our online store with this delusion of grandeur that our business would start making decent money within the first 3 months. After all, we had what we thought was a fool proof strategy.
Our initial plan was to siphon away EBay customers by posting auctions online and steering them over to our online store through links in the auction description.
Then, we would roam the wedding forums and guide customers over to our shop by making recommendations to would-be brides.
But what ended up happening is that we violated EBay’s terms of service and got our account suspended for posting external links on auctions. Furthermore, we repeatedly got banned on the wedding forums for being overly promotional.
There are no shortcuts. You have to be in it for the long haul. If you are wondering whether you can start making money right away because you are in a desperate situation, then chances are you lack the resolve to see your business idea through.
Estimating Time And Human Nature
But here’s what is interesting about human nature. When my wife and I reached our goal of making 100K during the end of our first year of business, we were overjoyed. But at that point we didn’t think we could do it again.
We didn’t think that our business could possibly grow any more. From our perspective, the business had peaked! After all, it was a major struggle for us to reach that number in the first place because it involved so much legwork and a little bit of luck. In fact, we didn’t think that we could achieve the same sales pace ever again.
What we didn’t realize was that the first year was just the tip of the iceberg. Every year since then, our business has increased in the double and triple digits! Never in a million years did we think that this could happen.
Which brings me to reiterate my second point.
As humans, we often overestimate what we can accomplish in the short term, but we vastly underestimate what can be done in the long run.
When I first started MyWifeQuitHerJob.com, I was hoping to start making significant money within a year of launch. Even though I started my blog with a 5 year plan towards profitability, I full on expected to be making at least 5 figures by the end of year 1.
But in reality, it wasn’t until well into year 3 when I started to see hockey stick growth. Today, the blog is practically growing on autopilot.
When I first launched my Create A Profitable Online Store course, I was only hoping to sign on about 30 students. But today, I have over 10X that amount and the course’s growth continues to surprise me!
Setting The Right Expectations
The key to running any successful business is to set the right expectations and the right level of commitment.
When my wife and I began our online store in 2007, we full on planned to still be in business in 2012. When I started my blog in the end of 2008, I full on planned to still be blogging 5 years later.
When I launched my “Create A Profitable Online Store” course in 2011, I made a long term commitment to continuously add content to the course for many years to come.
Even though the course started out with practically no content, today I have well over 40 hours of video in the course and a 400 page PDF ebook to show for it. And the best part is that the course will continue to grow and evolve!
Most people quit their businesses within their first year. If you aren’t willing to devote at least 3-5 years to your business, don’t even bother. Why? Because most of the wealth and the profits are to be had well after your first year.
Expecting your business to be vastly profitable within a short time frame is a half assed way to think about your business. Let’s be realistic. During the first year of any online business, your website is probably not going to have superior search engine placement. Your business probably won’t have a large customer base. Your business probably won’t have much name recognition.
It takes time for word of mouth to spread. It takes time for things to snowball. Looking back at my blog, I didn’t think that I was getting anywhere at all after year 1. But after doing this for 4 years now, I look back and am completely amazed at how far I’ve come.
Change Your Mindset
Here’s the biggest problem that I see with most people. They expect to make a significant amount of money in under a year and then they give up when they don’t reach their goal. I’ve had several students in my course give up early and even had an extremely talented student give up on his online store after just 6 months!
The first year is going to be tough and the most awkward. After all, you know nothing during your first year. Even if you have a great mentor or teacher, you still may not be able to absorb everything right away. So you’ll make mistakes…but that’s fine!
That first year is also when you’ll be having the most fun because you’ll be learning a heck of a lot. Year 1 should not be your end game. Instead, you should treat year 1 as your learning year and expect to reap the rewards in the years ahead.
One of the most unfortunate aspects of human nature is that we all love shortcuts. We all love to believe that we can strike it rich in just 6 months. Don’t get me wrong. It’s still possible to make a good chunk of change during your first year but you should go into it expecting to commit at least 3-5 years.
Striking A Balance
The key to finding the right business to pursue is to avoid randomly pulling yourself in all directions at once. Don’t throw up a bunch of websites, give them a go for 6 months as a trial and then take them all down because they aren’t working out.
You should go into every business venture with at least a 3-5 year time frame in mind. Are you still going to want to be running this business in 3-5 years? If you don’t think you’ll be able to maintain your interest for that long, then don’t even bother.
What you want to avoid is starting over every 6 months. If this is happening to you, then you aren’t committed and you are calling it quits without giving your business a chance to grow into something bigger.
Remember, most of the profits for your business are going to occur after 3-5+ years so make sure that you pick something that are willing to maintain for at least that long.
Ready To Get Serious About Starting An Online Business?
If you are really considering starting your own online business and quitting your day job, then you absolutely have to check out my mini course on How To Create A Niche Online Store In 5 Easy Steps.In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!
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That’s why I’m so glad I created a project to do with playing guitar because I’m never going to stop doing that.
Hey Neill
Projects that you are passionate about are the best and have the most staying power! Just as long as it doesn’t turn your hobby into a chore:)
The only down side is that I’m not spending all my free time making music. But on the plus side it pushes me to do more research and improve my knowledge of music theory.
And of course the dream is to be able to support myself full time with this and other projects so that I can live a more flexible life style and spend more time on music.
Wow couldn’t have come at a better time! I was just thinking man, there’s no way I’ll be making six figures anytime soon…and I was questioning my choices. However what you say makes total sense. And we need to be patient and work consistently, even when things seem less than ideal. I do believe in my niche, I just have to change my original strategy a bit to make it work well…that’s business, though!
Hey Mariana,
I think you are proceeding correctly with your link building. SEO takes a while to kick in. I have faith!
I think the 3rd year is make or break too. Well, at least you should have a really good idea of how much your business can make in the 3rd year. I don’t think I’m going to make 6 figures anytime soon though. I’ll give it another year or two and see where it takes me.
Hey Joe,
I didn’t know about your other site! Takes courage to retire early and I admire you for it!
Is that 400 page pdf ebook available anywhere?
Tracey, you should have received it already when you signed up for the course:)
This info actually helps to take the pressure off a bit. It’s very grounding to hear the realistic experiences and expectations for starting and running an online store. Thanks.
Hi Melisa,
Just wanted to reset everyone’s expectations to be more realistic, especially if you are starting from ground zero:)
Great post and although it’s so hard sometimes to keep going, having the knowledge that you know what you’re building, that it will come together, and that user growth will eventually be exponential takes faith!
Well said Marshall!
Yep! First year in business [last year] by this time in December 1st thru 13th… 9 lousy orders. This year so far, for December 1st thru 13th, 124 orders.
Longevity. Almost all the same products selling as last year — just finally getting found because I’ve been around enough for Google to notice me and get a few of my product listings on the first page. I’m sure there are more things I could be doing to make that faster, but for the amount of effort I am putting in, I’m happy with the progress.
– Lisa
Hey Lisa,
That is pretty amazing growth! What do you attribute to most of your increase in sales? Has it been all Google or did you start marketing your shop in a different way?
When I first started my blog, I was just excited whenever we got a new comment or a new subscriber. The first $100 didn’t come for 5 months, and I think we made $4,000 in the first year (most of it in months 11 and 12). The second year blew away my expectations and we made over $60k. We’re a few months into our third year now and on pace to bring in about $80k.
The first year is basically building the foundation for the growth that will come afterwards.
Hey Robb,
The is pretty amazing growth and especially impressive for a personal finance blog. BTW, I have some extra special javascript for you to try on your blog whenever you get a chance:)
Thanks for the pep talk Steve (and commenters). I kind of like to think of the first year like an internship, or going to school. It’s after the “promotion” or “graduation” that it starts to pay off.
Anytime Denny! Don’t get discouraged.
Thank you, thank you, thank you! We launched our site 8 days ago (it took us almost 6 months of work and product creation to get to that point). Now we’ve been trying to work on learning everything about Google Adwords, social media, SEO, etc. Last night we watched one of your videos and you said that it took you guys a few months to iron out your Adwords campaign. I think we assumed you just got online, sat down for 3 hours and magically the orders came pouring in. While our goal for year one is much, much more modest than 100k, it’s great to be continually reminded that this first year is all about learning… and that it takes more than a few hours to become an expert.
Hey Catherine,
I think that your online store looks amazing and your product descriptions are superb! Looking forward to giving your site a more in-depth critique after the holidays:)
Hi Steve! I love that your initial plans to generate traffic ended up getting you banned as spammers, but instead of cursing your bad luck and giving up you adjusted your plans and found the path to success. I made many mistakes when I started blogging and some shortcuts I took ended getting me nowhere. Now I know it is better to spurn the shortcuts and stay the course.
And I truly believe most people who fail simply gave up too soon. Success was probably right around the next corner but they quit before they could see it.
Hi Mike,
Good to hear from you. I think the single best thing we both did was to join the Mafia:) Especially with blogging, it’s often a numbers game as well as a waiting game with the search engines assuming you put out great content.
Your journey is an inspiration for me to build a business. Have been putting off the idea for so long.
It works the same offline as well. I have worked with many entrepreneurs that have 2-5 years in and they are just bumping along and getting by and then all of the sudden their work gets noticed and they start to take off. I think that a 3 year commitment (of three years of hard work) is really the minimum. Of course, I wouldn’t mind if my store became the exception to that!
Thanks for the reality check, Steve. I think the message of instant Internet riches that’s so pervasive right now, actually stops a lot of people from starting real businesses because they think if they haven’t made it in a few months, that they’re missing out on something else and switch. For the first three months with my online store, I had two orders, but now I get new orders every day. I can see how the things I’m learning about marketing the site, improving SEO and letting word spread are actually having an effect.
Online business is a very volatile business and anything could happen from seo black list to being banned from money making affiliate schemes. So its better to start a business with an open mind that perhaps nothing will come out of it.
Loved the article, especially the very motivating “we underestimate the long-term” part
This was a great article with many nuggets that most people will miss. Thanks for the great post. I have been in a Home Based Business opportunity for the past 4 1/2 years and I hate to see so many people make a brash judgment on a business that they have never even investigated fully. Do your due diligence and research any opportunity fully before you make the mistake of writing anything off.
By doing so, you may find an opportunity of a lifetime!
May All your Ventures Be Met With Success,
Omarra Byrd
Hi Steve.
Thank you for this article and the information you send me/all of us every week. It has helped me to start getting back on track and feeling good about myself again.
I’ve had a couple of small businesses already that did not work out the way I had planned. They were a great experience and I don’t regret having them but it has left me a little gun shy to start something new, particularly online. I had a misconception of what it meant to own and operate my own business, I didn’t realize what kind of strength and character and major planning it took to see it through. One thing I know is that it cannot solely be about the money or it won’t work. I speak from experience. You need to have a connection, a passion to your chosen business and a real desire to help, inspire and connect with others. That’s what it’s truly all about. Once you have those key foundations in place, the money will come.
I was almost going to give up on the online idea and unsubscribe from your newsletter and then I had a change of heart. I have been rebuilding myself from the ground up and regaining my self-confidence. I’d been working on it for a while but it just wasn’t coming together. But thank the Lord, all the work I had done (on myself) finally paid off and things have started to click again and the ideas are starting flow. What a great feeling. Thank you for being a part of that.
I am very new to online blogging and I was thrilled to have 16 readers today. I am hunting for lots of online inspiration and found you on Boomer & Echo.
From the other how to blog blogs I have been reading people do expect that hoards of readers and income will flock to their sites as soon as they start to post.
Not sure if I am prepared to stick with it for 5 years to see results but determined to give it 2 years of time and effort (on top of my day job).
Staying focused and being consistent is insurance for success online. It can lead to some long nights but it’s worth it!
Thank you, I will not give up
Hi, thanks for the great article. I am going to show it to my wife, since i just started my online business and she keeps asking when we are going to be making money. I know it won’t happen overnight but everyday that i learn something new i know i am getting closer to my goals.