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What Will Cause the Value of Online Businesses to Soar?

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Building Wealth Through Online Businesses

In an era marked by the coronavirus pandemic and a new business landscape, owning an online business has emerged as a strong strategy to build wealth. This has been demonstrated by the success of certain online businesses, such as those selling nutrition and home exercise equipment, that not only survived but thrived during the lockdowns.

The Impact of Lockdowns

The forced closures dealt a heavy blow to many local establishments like restaurants, gyms, and dental practices, and other industries such as travel and hospitality. Unemployment reached unprecedented levels, illustrating the vulnerability of these businesses.

How Business Valuations are Calculated

Businesses are typically valued by the net present value of future cash flow or based on multiples of revenue, profit, or net profit. The more certain the earnings of a business, the higher its valuation. In the post-pandemic world, online businesses are expected to be rated higher due to their resilience against potential future global pandemics.

Online Business Valuations on the Rise

Online businesses encompass a wide variety, including e-commerce, social media, and newsletters, among others. Despite the diversity, online businesses generally stand to gain value compared to traditional ones that face higher shutdown risks.

The experience of recent lockdowns suggests that politicians are more inclined to use them in future crises, emphasizing the need for businesses to plan defensively against these risks.

The Importance of Owning an Online Business

Owning an online business provides a solution to one of the greatest challenges for parents: securing their children’s future. Despite significant investments in education, parents cannot control employment opportunities for their children due to anti-nepotism policies in reputable firms. This leads to a scramble to secure favorable positions, sometimes through questionable means.

Online businesses offer a way to bypass these challenges, allowing parents to employ their children and ensuring a path to financial stability.

The Comparison: Corporate Employees vs. Online Business Owners

Comparing a senior corporate employee earning $1 million a year to an online business owner earning $300,000 with full ownership provides insight into the value of control and flexibility. Though earning less, the online business owner enjoys numerous intangible benefits and long-term financial advantages, including financial security for their children.

The Future: Embracing Online Businesses

The world has changed, and so must our approach to business and education. With global competition and a shifting economic landscape, it’s crucial to adapt and seek new opportunities. Online businesses offer a practical path, with many benefits including:

  • Difficult to shut down
  • More robust earnings
  • Greater profit margins
  • Flexibility in operation
  • Educational opportunities for family
  • Employment possibilities for loved ones
  • Increased internet usage and penetration
  • Capital interest in online businesses

Conclusion

While starting an online business might seem daunting, the process has never been more accessible or affordable. The success stories of others provide inspiration, and the benefits are tangible. Online business valuations are poised to climb, and now is the time to seize the opportunity. Thank you, America, for the chance to try, and if you’re interested in starting your own venture, here is a guide to get you on your way.

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