Googling the “top profitable business ideas” left me pretty disappointed. I’m not going to lie, nearly all the articles I found were under-researched, outdated, and just simply not profitable. The ideas various writers recommended at the top of search were literally 5 years outdated. It stinks because it’s really misleading and there might be entrepreneurs (like you) who are actually thinking about going after those ideas. And most likely fail. Having started some of those businesses in the past, I can tell you overall the challenge is in low of profit margins and highly competitive markets. Before we get into the business ideas I recommend, here are a list of ideas that I don’t recommend:

Amazon FBA

It’s just not a good idea anymore. Just search a product on Amazon and you’ll find pages and pages of the same exact product. Gone are the days you could private label products for a profit. The idea here is to basically take products from Alibaba and private label them. This just doesn’t work anymore as a new seller.

Starting an e-commerce store

Same idea with Amazon, except you are driving traffic to your own website. The margins aren’t there. The product cost and logistics are typically too expensive, coupled with your digital marketing spend. It’s getting harder and harder to find a product that isn’t readily available on Amazon at the same or better price.

Dropshipping

I’m not sure why people are still peddling this as a good idea. After all the costs (as stated in number 2), you won’t be left with any profit. You’re hustling the same product everyone else is. The only person making money is the distributor you are purchasing product from (e.g. Aliexpress, Alibaba, using an extension like Oberlo).

Day trading (options and forex)

There is a lot of hype here right now (rightfully so as the markets are going crazy in 2020). As a former options trader, I know many many many people who lost more money than they made. These were professionals. I am not saying this is a bad idea, but it will take a ton of your mental headspace. It will be really difficult to do well if you have a day job or doing it half-heartedly. The Robinhood app has made it so easy to passively trade. However I don’t recommend most people pursue this route due to the stress and uncertainty involved.

Becoming a translator

Terrible idea as a business idea. You’re trading your time for a certain hourly rate. There is no way to scale and automate this. It’s basically working a job.

Developing an app

It’s a very saturated and complicated space. It’s extremely difficult to acquire users profitably. Unless you are experienced in building an app business (monetization, user acquisition, and so forth), I would steer away.

Advertising on your blog

Many bloggers will share that selling ads alone is not very profitable and you will need a few million to make it worth your while.

Selling your skills on Fiverr

It’s called Fiverr for a reason. Pay is extremely low. Look elsewhere.

Good business ideas will come from within

At the end of the day, a business needs to have a competitive edge. Whether that’s a skill you’ve developed over time (and is not easily acquired), unique knowledge you have that also isn’t easily acquired, your hustle, your unique geographic location. The list goes on and on. The bottom line is you’ll need to think about what do you know or have that others don’t? This should be the basis of your business (playing to your strengths and assets).

If you don’t know where to start, I created a 3-day course that will help you. Subscribe to our newsletter to get access to the course right now.

But the question still stands- what then are the profitable business ideas?

Here are 7 online business ideas that still make sense:

1. Software products

Andreessen Horowitz’s tagline, “Software is eating the world,” couldn’t be more true. With the onset of the Pandemic, software has really taken the driver’s seat for nearly every industry.

2. Physical products

As long as it’s not private labeled from Alibaba and you’re inventing something new, this is absolutely viable. Just make sure you are validating your product all along the product development journey.

3. Writing an ebook

People are hungry for deeper knowledge. Sure, there’s a lot of free content on Youtube. But it’s hard to find the deeper stuff. That’s why writing an ebook and going deeper than anything you can find for free works.

4. Lead generation

If you know how to find leads for a specific business, this could be a really great side hustle.

5. Freelancing

Depending on your current skillset, trading your time for an hourly or project rate could be a good option for you (e.g. digital marketing, graphic design, consulting).

6. Online courses

If you have a unique skillset or knowledge base, you can create a course around it to help share it with people who are looking for help in that area (even if it’s just a dollar).

7. Mobile services

This could be any service where you are traveling to people’s homes or businesses. Think auto detailing, housekeeping, landscaping, pets, junk removal, etc.

8. Independent contractor for Uber, Lyft, Grubhub, Shipt, goPuff, Vroom

This has become a popular way many people make some extra money on the weekends or after work. It’s respectable, however would not help you build an online business. It’s a great way to build up your business fund, or generate any extra cash you might need in a season of life.

9. Sell your art (or other creatives like beats)

Whether it’s printing your photographs into prints or something you draw or paint, this could be a great way to start a business that will continue selling.

This is by no means a comprehensive list, however a place to start generating some ideas for your business.

We wrote about some of the businesses that we’ve started in the past.

How do you start an online business?

Once you’ve landed on an idea, you’ll want to do your due diligence and make sure it has legs before you start.

1. Validate your idea with market research
2. Generate sales before you build anything
3. Build your company financial statement (to make sure you will stay profitable)
4. Build your strategy to generate sales (lead generation)
5. Develop your product

Right now, we are building a course on how to build a successful business. Before that though, we created a 3-day course to help aspiring entrepreneurs set their lives up for success. If you are interested in learning more, subscribe to our newsletter to be the first to find out when it goes live!