The internet has obviously changed how we live, work and do business. Where brick-and-mortar once ruled, many innovators are now building companies that exist solely online.
As new businesses lean into the digital landscape in a way traditional companies never could, the outdated barriers fade away, opening up a whole new world of possibilities for ambitious entrepreneurs.
What is digital entrepreneurship?
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 — 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.
Each of them built their companies from scratch by leveraging the internet’s global reach, allowing them to create and rapidly scale an online business.
What does a digital entrepreneur do?
Digital entrepreneurship takes advantage of always-on technologies to create new internet-powered business models. So, who builds those business models?
Digital entrepreneurs, of course.
Location-independent with global reach, digital entrepreneurs rely on laptops, smartphones and the internet rather than brick-and-mortar offices.
But having gone 100% digital, what does the day-to-day look like for the next generation of digital entrepreneurs?
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They’re building digital products, like customized courses and platforms that live online.
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They’re using the internet to market globally, sell products and services like e-books and deliver them digitally.
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They’re managing operations through automated, web-based tools rather than in-person processes.
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They’re analyzing metrics and data to optimize things like website traffic and business performance.
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They’re staying on top of emerging technologies and honing the latest technical skills.
In short, digital entrepreneurs focus on leveraging technology to build, manage and grow innovative online businesses that fully embrace the digital landscape. No more dedicated physical stores or warehousing of inventory — even companies with physical products can be fully managed online because their operations are just all ones and zeros.
What are the traits of a digital entrepreneur?
Launching a digital business requires a distinct mindset and a few handy skills. Here are a few traits of successful digital entrepreneurs:
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Technical know-how — You don’t have to be a programmer, but having a working knowledge of digital platforms, tools and emerging tech goes a long way.
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Adaptability — Technology moves fast, and digital entrepreneurs have to move with it, evolving alongside the constant changes and innovations of their digital world.
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Global vision — The internet allows startups to reach customers worldwide, so digital founders have to think globally from day one.
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Marketing savvy — Marketing across social, SEO, email and more is crucial for digital entrepreneurs whose businesses lack a physical presence.
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Problem-solving — When tech breaks or strategies stall, digital entrepreneurs often have to pivot quickly to stay in business.
Those are the traits that make a difference. More importantly, the digital entrepreneur has the creative drive to find fresh ideas, the resilience to persist through challenges and a global vision that appeals to a worldwide audience.
How digital entrepreneurship is different
Launching an online business has some key differences from brick-and-mortar startups. Here are a few ways digital entrepreneurship stands apart:
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Lower barriers to entry — Digital businesses often require less upfront capital because no physical storefront or inventory is needed for companies that offer digital products. This makes launching more accessible.
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Lean operations — Without having to manage in-person logistics, digital companies can stay lean and nimble. Automation helps streamline many processes.
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Remote work — Digital tools allow entrepreneurs to manage operations and collaborate with team members remotely, adding flexibility.
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24/7 access — Websites and apps allow customers to access digital businesses globally anytime. No business hours.
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Scalability — Online platforms make it easier to scale up rapidly by reaching wider audiences and automating workflows.
The opportunities presented by digital entrepreneurship have fueled an explosion of new business ideas, from mobile apps to AI to quantum computing. Digital entrepreneurs thrive in environments like this by designing a ready-for-anything business that can stay one step ahead of the latest technologies.
But Main Street still has a place
Traditional businesses with physical sites can also become digital entrepreneurs — think of the popular Starbucks mobile app that lets you order a drink on your phone and have it waiting for you when you get to the store.
And Starbucks is just one example among many. Take Apple retail stores and their Today at Apple sessions that blend in-store experiences with an online ecosystem. Or Eataly’s use of digital tools to expand their brick-and-mortar cooking schools globally.
In fact, traditional businesses like these have their own unique advantages that remain very relevant:
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Local connections — Brick-and-mortar shops build loyal communities and network locally in a tangible way that digital can’t always replicate.
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Personal touch — In-person customer service and interactions lead to relationships and experiences not possible solely online.
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Specialized spaces — Custom physical stores and restaurants provide experiences beyond just purchasing a product or something to eat.
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In-real-life (IRL) skill sets — Managing commercial real estate and running in-store operations take a different skill set from a digital operation.
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Hybrid potential — Many traditional businesses are now successfully adopting digital tools for marketing and selling, even while retaining their physical spaces.
The growth of digital entrepreneurship does not make traditional companies obsolete. As Starbucks, Apple, and Eataly show, in many cases, it can expand a brick-and-mortar company beyond its physical limitations.
Thinking about digital entrepreneurship?
Right about now, you might be saying to yourself: “Digital entrepreneurship sounds great! How do I get started?”
There are so many possibilities for an aspiring entrepreneur to build an online business that it may seem hard to choose the best one. The key might be to narrow your focus to a proven business model that fits your skills and interests, with well-established options to consider, like:
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Becoming a content creator on Instagram or TikTok if you love creating content and connecting with audiences
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Building a SaaS company if you’re passionate about technology and solving real-world problems through software
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Launching an e-commerce store if you enjoy creating unique products or curating an online shopping experience
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Offering web development services if you have strong coding skills and understand how to build websites
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Starting a digital marketing agency if you’re good at data-driven advertising and promotions
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Creating an educational online course if you have deep knowledge to share on a topic
By identifying the digital business model that suits you, you can turn your specific ideas and abilities into your own digital business. The only thing you need to do to get started is validate your idea and build something digital that people want IRL.
Ready to go digital?
The rise of digital entrepreneurship represents an exciting range of possibilities for today’s innovators. With the barriers to launching online ventures lower than ever before, entrepreneurs are embracing emerging technologies and digital tools to build, manage and scale businesses from anywhere in the world to audiences everywhere across the world.
Like any business, traditional or digital, the key is finding the right fit for your specific skills and interests. Because the promise of digital is that with a powerful business description and a focused game plan, anyone can turn their dream into a thriving digital business.
Want to talk about ways to help strengthen your business idea or grow your company? Reach out to a Chase business banker today. We’re always ready to help.
