9 Types Of Online Business – Which Is Right For You?

Start Earning Online – Lesson 3

Course Progress

Watch the video or scroll down to read this lesson instead.

In the previous lesson you learned that there are endless ways to earn a living online, but some are easier than others.

In this lesson we’re going to run through 9 different types of online business, and figure out which is best for you.


1. Advertising

You might hear of people making a website, slapping some Google Ads on there, and hey presto, they’re making loads of money.

Well, the problem there is that you need a ton of traffic to make any significant income from advertising. You need a steady flow of people visiting your website, or your Instagram, or whatever it is, and it usually takes months if not years to build that up.

So, making money online through advertising: not quick, not easy.

2. Affiliate Marketing

This basically means recommending other people’s products or services, and getting paid a commission for every referral.

And the challenge here is much the same as Advertising.

You also need to build a significant audience to make money doing affiliate marketing, and not only that, but you also need to earn the trust of that audience so they take your recommendations seriously.

And again, that takes time.

So, making money online through affiliate marketing: not quick, not easy.

3. Blogging / Vlogging

I have quite a bit of experience with this, having been blogging and vlogging for years now.

Last year I had more than 500,000 page views on my website and more than 300,000 video views on YouTube.

Those numbers actually aren’t huge – they’re mediocre at best, but believe me it took a lot of time and effort just to achieve those numbers.

And even with that many people reading my blog and watching my videos, I’m not making anywhere near enough money as a blogger or a vlogger to support my lifestyle.

So, making money online through blogging or vlogging: not quick, not easy.

4. Creating And Selling Digital Products

I’ve also done quite a bit of this over the years, having created and sold numerous ebooks, online courses, that kind of thing.

My latest digital product was an online course, and while that did okay financially and helped hundreds of people, it also took A LOT of time and effort to build, market and maintain.

I actually would have made a lot more money if I’d invested the same amount of time and effort into another type of online business that I’ll tell you about in a minute.

So, making money online through creating and selling digital products: not quick, not easy.

5. Dropshipping

Yeah, not that.

Actual dropshipping is increasingly popular nowadays and several friends of mine do it.

It basically involves selling physical goods to customers without stocking those goods yourself. So you make the sale, and then get a wholesaler or manufacturer to ship directly to the customer.

And yes, this can be very lucrative.


If you’re just starting out, it’s going to take significant time to get everything in place and start turning a profit, because there are a lot of moving pieces.

Also, competition here is tough. If you find a nice niche for yourself, it’s usually best to keep it a secret, because there are lot of powerful competitors out there with plenty of resources, and they can quickly drive you out of business.

So, making money online through dropshipping: not quick, not easy.

6. SaaS

That stands for Software as a Service.

An example of a SaaS business would be accounting software you pay for each month, or mailing list software you pay for each month. Dropbox and Slack would be famous SaaS businesses.

SaaS might actually be the best online business model out there. It’s software, so it’s all digital, and your customers usually pay you repeatedly.

I’ve actually spent significant time trying to build a SaaS business myself and even spent $3600 on a course to learn how to do it. My efforts ultimately failed – or at least they haven’t succeeded yet; let’s stay positive here – because there was just so much hard work involved.

I’ll likely give it another try some day, but I’ll do so with the understanding that it’s not quick, and it’s not easy.

7. Sponsorship

I gave an example of this in the previous lesson. It was a ukulele teacher who earns $6,000/month from 1600+ fans on a platform called Patreon.

One thing I didn’t mention about that guy before is that he has made more than 500 videos and has over one million subscribers on YouTube. And if you didn’t know, creating that many videos and building that kind of following takes some serious work.

Now, as I said, that guy has about 1,000 people paying him a little bit each month. A more common variation of the sponsorship model is to have one or two big sponsors for your work.

People do this on Instagram, on YouTube, on podcasts… but to get just one or two big sponsors, you would still need to put forth significant time and effort to build up that big audience first.

So while this is a great model, probably my favorite actually… it is certainly not a quick or an easy way to make money online.

Now, let’s pause here for a second…

So far we’ve gone through 7 of the 9 types of online business:

  1. Advertising
  2. Affiliate Marketing
  3. Blogging / Vlogging
  4. Creating and Selling Digital Products
  5. Dropshipping
  6. SaaS
  7. Sponsorship

Now I want to be clear that these are all viable online business models and you’ll find no shortage of success stories for each of them.

But if we think of online business as a video game, choosing one of those 7 to start off with is like beginning that video game on expert mode, with loads of extra baddies and obstacles in your way…

Which is fine if you’re experienced, or if you just love making things hard on yourself.

But, assuming your main goal here is to start making some good money online as quickly and as easily as possible, then I would recommend that you start playing that video game on easy mode…

And what does easy mode look like for us?

It looks like our last 2 types of online business.

The first of those is…

8. Freelancing

Freelancing simply means providing a service directly to a client, and getting paid directly for it.

Online you can be a freelance writer, a freelance web designer, a freelance social media manager… etc. etc.

Several years back when I quit my office job I spent a whole year determined NOT to do freelancing, because let’s face it: it’s not glamorous, and it’s not sexy.

I saw freelancing as too basic and I didn’t want to trade time for money.

No, I wanted to become a real deal online entrepreneur, earning money in my sleep!

Unfortunately, what ended up happening was this: I spent my first year working for myself trying to be a real deal entrepreneur, trying to earn money in my sleep… and I didn’t earn much money at all :-/

It was only when I got serious about doing freelance web design that I started earning a consistent living online, which enabled me to travel all around the world, non-stop, for almost four years.

Since then I’ve met and corresponded with thousands of other online web workers, and without a doubt, the most common way I see them making a living online is through freelancing.

Even if you have no existing skills, you can literally start making money online as a freelancer within a week.

Now that’s something that CAN’T be said about all these other types of online business we’ve talked about already. Because with all the aforementioned, you usually have to put in several weeks, months or even years of work up front, before you start earning any significant income.

Not so with freelancing.

Freelancing is a much quicker and easier way to start earning money online. If I could go back in time, I’d have started doing it much earlier myself. I wouldn’t have wasted that whole first year.

All that said, freelancing is not perfect by any means:

  • It can be tough to find clients
  • You might have to start out with a low rate
  • Your income can be up one month and down the next

And those things can be very difficult to adjust to if you’re coming from a 9-to-5 job with a steady paycheck.

Which brings us to the final type of online business.

9. Remote Work

This is a bit different from the rest because you don’t really run your own business here.

Instead, you become a remote employee of someone else’s business.

This is increasingly popular nowadays: more and more companies are hiring and working with people 100% remote.

And this can be the best of both worlds for you.

A friend of mine named Tom actually started out working online this way. He found a remote copywriting job and was paid a salary of $3000 per month. The company that hired him was based in the United States. Tom was based in Berlin. He only needed to work about 20 hours per week to keep that employer happy and earn his $3000/month. He was able to do his work from home, from a trendy cafe in Berlin, or from anywhere else in the world really.

Pretty good, right?

Of course, remote work isn’t perfect either.

  • It can be hard to find a really good remote job
  • They’re usually looking for a longer term commitment
  • You might have to work set hours (which can be difficult if you’re eager to travel)

In other words, remote work is usually more steady and predictable than freelancing, but you won’t have quite the same level of freedom and autonomy.


Freelancing Or Remote Work?

Which you should choose depends on your own preferences.

But either way, as a freelancer or remote worker, you’ll likely be earning money online much quicker and easier compared to these other 7 types of online business we spoke about earlier:

  1. Advertising
  2. Affiliate Marketing
  3. Blogging / Vlogging
  4. Creating and Selling Digital Products
  5. Dropshipping
  6. SaaS
  7. Sponsorship

As I said, starting with any of those 7 is like beginning the video game on expert mode.

Whereas with freelancing or remote work, you’re beginning the game on easy mode, and thereby giving yourself a much better chance of success.

The Most Reliable Path To Build A Successful Online Business

Let me wrap up this lesson by clearly mapping out the most reliable path for you to build a successful online business.

This comes not only from my own experience, but also from the experience of 1000’s of people I’ve worked or corresponded with over the years.

This is the path of least resistance, the path I’ve seen work best for most people, so it’s likely to work well for you.


Get your online income flowing consistently as a remote worker or freelancer. Those are the quickest and easiest ways to do it, and you can even do a bit of both at the same time.


As you gain experience, increase your rate and reduce your hours.

You want to get to the point where you only have to work 15-20 hours per week, at most, and earn enough in that time to cover all your expenses and have some money left over.


Once you get to that point, you’re free.

Now you’re earning a comfortable living working part-time hours, and you can spend all your free time off traveling the world and having loads of mad adventures.

Or… you can spend your free time building one of those first 7 types of online business we talked about.

Because those ARE businesses worth building.

Yes, they are more challenging, and yes, they take more time to get off the ground – which is why I don’t recommend trying any of them right out of the gate – but, if you’re anything like me, you won’t want to play that video game on easy mode forever.

So think of remote work and freelancing as stepping stones – albeit very important stepping stones, but stepping stones nonetheless – to bigger and better online business models.

You start small, make things easy on yourself, get some money flowing, free up your time, gain some experience, and then move on to the big leagues.

Make sense?

Yeah, sorry about that.

And it’s about to hurt even more because I have a quick question for you.

And that is:

What is your #1 takeaway from this lesson?

Was there anything in here that particularly surprised you or stuck with you?

Please go ahead and leave your answer in the comments below. This is for your benefit, because when you take the time to reflect and put down in writing what you’ve learned, you deepen that learning.

So take two minutes now and share your #1 takeaway in the comments.

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About The Author


  1. This is a different take than a lot of the other “build an online business” advice I’ve seen, and I think it’s because those tend to be about figuring out the thing you want to bring into the world, like what tribe or change you want to create, and making a business around that. The question here is strictly about making money and that is where my mind is at.

  2. I like how you put it into steps on how to have a successful online business. I have read many tips and tricks on how to be a freelancer but your tip on how to get to that successful place as a freelancer is the first I have ever seen. Thanks

  3. Matthew O'Donoghue

    What struck me is the fact that i can actually learn and acquire a skill in only one week, and use this skill to help me start earning online. tbh beforehand i would have thoough it would take years.

  4. Hello Nial, I’m greatly impressed by the way you present it. I want to start as from today but k9ndly show me how to begin freelancing, it’s my only option, please.
    Looking forward to your kind consideration.

    1. Hey Patrick,

      I see you’re subscribed to my Start Earning Online series. Keep going through the lessons there and you’ll have plenty of info to get started.

  5. G’day again Niall,
    Nothing really jumped out at me as I do know of all these possibilities,
    As I have said before I am a Structural Draftsman, I have been trying to twist the arms of past and present employers to allow remote working, I haven’t yet been successful even though last Christmas while the office building was closed they were quite happy for me to work from my apartment.
    They seem to think that you need to have direct communication with the Engineers and that you do however that is what Skype is for, we do use that between offices.

  6. Roughly corresponds my experience. I tried remote work, but bit off more than I could chew. And it’s not passive.

    The type of work I do best (realtime embedded systems) is a bit hard to do remotely, so I might need to re-train a bit…

    The type of work I really love is teaching violin. I would need to substantially revise my approach to make that viable online. And I fear that I would not enjoy doing online/recorded violin lessons as much as one on one lessons in my studio.

    1. There are lots of sites that list remote job opportunities. For example:


      Find one you like and apply.

      If you don’t have the skills yet, get busy learning and practicing.

      It doesn’t have to cost you anything to start, though occasionally it makes sense to invest in a course to speed up your progress. But if you’ve got plenty of time and don’t mind some trial and error, no need to spend any money.

  7. Sheila Louise Omondi

    I spent so much money trying to get into affiliate marketing but I failed miserably.You’re right. Not something to start with. I now want to look into remote jobs because I like the concept of working consistently without being tied to one place.

  8. You have confirmed what I have been contemplating. I want to do freelance online administration/proofreading etc. So freelance/remote work sound like my solution.

  9. I didn’t know much about remote work. I’m glad you talked about it even though I’d probably prefer being a freelancer as I’ll be travelling, so I can choose when I want to work more and when I want to work less, depending on the activities I’ll be doing.

  10. Freelancing and remote work sounds interesting. any tips on where to start the search for these jobs?

  11. Definitely a remote work is what Im thinking of at the moment, the reason I get to know about digital nomad is because I saw a job offered by 5CA company

  12. I trust this recommendation as I have been trying to get into affiliate marketing and found it very difficult to make any online income, so I tend to agree with freelancing or remote work and sure do hope there is availability in South Africa for them?

    1. Well that’s the beauty of online freelancing and remote work, Bryan: doesn’t matter where you are in the world, you can still find gigs and start earning money either way. So if you’re in South Africa, there’s nothing stopping you from working with clients and companies in Australia or Canada or anywhere else in the world really.

  13. Thanks again Niall! the main thing I have taken away is I need to start applying for stuff on upwork etc! will probably have to wait till November though, as I am currently working at a hotel for the summer and doing 50+ hour weeks…

  14. awesome insight brother. coming from an offline business world, the first seven speak to me so much. however as you said starting point matters a lot.

  15. I have done freelancing and have found it not qyick and not easy –
    a challenge. Clients prefer cheap and fast, and there is a lot of overhead time ironing out requirements. . . and no one pays when your computer crashes, or you need new software.

    1. Niall Doherty

      Yeah, I was careful not to say in the video that freelancing is quick and easy, but that it is much quickER and easiER than the first seven online business models I mentioned.

      Some clients certainly do prefer cheap and fast, and some clients do love to micromanage and nitpick, but those are the clients to avoid. Think of it this way: some customers love to go to WalMart and pay very little. Others are happy to go to Whole Foods and pay a lot more for superior products and service. And the latter are usually more pleasant to deal with. The same is true of freelancing clients.

  16. I live in the UK and I’ve recently been doing matched betting http://www.teamprofit.com/tomclark
    And making £10 a day, it’s quick and easy. But I also work 30 hours a week and I’m looking for something more sustainable to do long term and freelancing seems the way forward to make some good money. Thanks for sharing this and prompting me

  17. Really awesome Nial, You nailed it! On my site and on Quora I get asketh the question about how to earn money online a lot. Freelancing, of course, is the easiest way to start earning. Then you can diversify into other areas.

  18. Damian Rensen

    Great video!

    I didn’t really know that remote workers are so popular these days. So that is something I want to learn more about!

  19. Great stuff, Niall! I have been working online for a number of years now and agree what you say here. It is easy to get tempted by the idea of passive income and focus all your attention on that. It is definitely possible to choose that as your preferred method, but it requires a ton of time, attention, and hard work.

    Freelance work may not be as sexy, but it will give you the chance to start making money online much faster, and much more steadily. Starting there with the intention of building an online business with other business models later, is the perfect strategy and you keep yourself from falling into some passive income get rich quick scheme :).

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