How I Started an Online Business and FAILED
Hey everyone, Katarina here and in this video I'm going to be talking about how I started an online business failed and lost 2 300 dollars in seven months. I will be sharing all my mistakes, my ups and downs what business models I tried out, what kinds of problems I faced along the way and if I'm giving up after spending all of this money and getting barely any results. So my answer to the last question is - absolutely not, but more importantly I really feel like it's necessary for people to hear about the not so glamorous side of business, which is failing and losing money, so they can have a more realistic picture that is not being talked about enough on social media. I'm making this video
because I really want to warn anyone who is also considering pursuing a business about how hard it actually is to succeed, how much money it takes and also prepare you for all the challenges and everything that might go wrong once you launch, because trust me, it most likely will. So if you are someone who has an entrepreneurial drive who wants to start an online business then keep watching the video and if you're not, also please continue watching the video till the end or even let it play in the background because I'm really close to being monetized on youtube and it will mean a lot if I reach those 4 000 hours of watch time that are necessary to start making money on YouTube. If you can't, it's fine. I'm still very thankful for everyone who's been supporting my channel even when I was busy during the last few months. And I know that i haven't been posting on social media for a while, but hopefully you will understand after watching this video, that right now I'm trying to build a career for myself. I really want to make this a priority until I succeed, so
I can work from home which will then allow me to travel to almost any country in the world, and also make content on youtube for you to watch and enjoy. And with that being said, let's get back to the topic of today's video which is why and how I failed, but before i share that with you, i really want to address a few topics around online business and why i felt like it was an opportunity that i had to take advantage of in the first place. So why should someone start their own business ? Well i think that this sentence explains it all. The reason why you should be
self-employed and work for yourself is because - When you work for someone else at the beginning it's easy and over time it gets hard, but when you start your own business at the beginning it's hard but over time it gets easy. And yes, starting an online business means more responsibility, but if you succeed, it also means a far greater payoff and much higher potential for reward and also if it's an online business, it also means that you can achieve location and time freedom which means that you can work when you want and from where you want. So once i started educating myself on the topic of money i realized that it is definitely worth it to try it out and make it work now, while i still have the the energy the time the resources and barely any risk or responsibilities. So now that we've established that building a business is the key to freedom this is why you shouldn't start just any business, but an online business that is in my opinion the number one best business opportunity of the 21st century. So as we all know we are currently in the digital revolution which is moving at a very fast pace and where computers and phones have gotten so much better in the last 30 40 years ever since the internet has been made and where some of the biggest companies today have been started only in the last five to ten years.
We are living in a world where things are changing so rapidly that people who start with nothing today can disrupt businesses that have been around for centuries. For example like Airbnb that doesn't own a single piece of property but that is bigger than some of the hotels combined that have been around for hundreds of years. Online or e-commerce industry has been growing at an exponential rate in the past 20 and especially in the past few years, but has exploded in 2020 because more people have been traditioning to shopping online due to the pandemic. While physical retail stores were forced to shift their businesses online and hundreds of thousands of brands were either closing or filing for bankruptcy; e-commerce has been growing at a 20% rate each year but when the pandemic hit the total number of sales tripled and 10 years of e-commerce growth has been reached in the span of only 3 months. That upward trend is only going to get bigger each year from now by 2045 over 90 of transactions will be online and most people will be shopping online as it is projected that another 1 billion people will join the internet in the next 3-4 years. All of this shows us that online shopping is not going anywhere anytime soon and that opportunities on the internet such as building an online business, selling things online and getting into e-commerce are amazing for anyone who wants to make money online.
Today we can make thousands of dollars on the internet and we should definitely take advantage of that. If starting a business seems scary to you there are also jobs online that you can apply for. If where you live there is not much work opportunity you don't have to be limited to only looking for a job in your city. You can also have remote income and work from home for countries such as
the us uk canada australia and be able to spend it in your country where your money goes a longer way. So those are the reasons why you should start an online business in 2021 and what are the 3 main and most popular online business models and how does each of them work ? First you can sell products by having your own e-commerce or online store. And this is a great business model but it requires that you buy products beforehand and that you also ship them to your customers either by yourself or by hiring a 3pl company to do that work for you. If you are a creative person you can also sell custom products and paint shoes, nails, make clothes, accessories but again you will first need to buy a certain amount of products to customize and then ship, which requires a high startup cost because you need to buy all those products and supplies for the store, whether they sell or not. Secondly, you can sell directly from the manufacturer without having any inventory which is called drop shipping. Here you also have your online store, but you don't physically own the products that are listed. When a customer places an order on your website
you don't ship it yourself because you don't have any inventory for it. You use that money to order it from your manufacturer vendor or seller and have them ship it from their warehouse directly to your customer and you just pocket the difference which is now your profit. This is a great business model that is cheap to start because there is no inventory that you need to invest in upfront or ship yourself. You just need to build a website and use marketing tools and your marketing skills
to acquire customers. It's very low risk compared to the first option where you have to buy a bunch of products worth thousands of dollars, not knowing if you're going to sell any of them. With dropshipping you only purchase a product after your customer orders it, which is great but one of the negatives is that you have no control over your fulfillment time, meaning that shipping can sometimes take over a month to deliver, which of course will make your customers angry if you don't disclose it, and also that you have to run ads to your products and handle a customer service yourself. Another business model is to sell or promote other people's products for commissions in return which is called affiliate marketing. In this business model you
will be marketing other people's already existing products for a cut of the sales or commissions. Some affiliate programs such as amazon gives you 1-10% commission rate and others like clickbank gives you 50-75% commission rate. So you basically just refer the sales between the purchaser and seller, which is great because it doesn't require any inventory and has a low startup cost. But the only negative is that you have no control over the products
and that those products may discontinue after some time. The next point that i'm going to make is going to further prove why starting an online business is better and less risky to pursue than a physical retail business, like a boutique, a coffee shop, a restaurant, a physical store. There are many reasons why but some of the most important ones are - the low startup capital, the low cost of maintenance, more profit, the reach and the scalability of the business. So why do brick and
mortar retail stores have a high startup cost? Well, it's not only because of the cost and the amount of inventory that they need to buy in bulk and have available from the very beginning and at all times but it's also because they need to fix up and lease the office space for the next few months, to buy utilities and employ people even before they sell their first product. As a retail business owner, you need to get yourself in 10s or 100s of thousands of dollars in debt, to get a loan from a bank or raise funding, but as an online business owner, you can start with less than 5000 or 10,000 dollars and scale to tens and hundreds of thousands or even millions in sales. Aside from very high risk investments, physical businesses also have a lower margins and earn less profit, because of all the high expenses that they have, that online businesses don't, which is again why online business is not only much more affordable, but also much more profitable compared to a brick and mortar business. And lastly when you have a physical business, you can't reach people
outside of your location from other countries for example. But an online business has an unlimited potential and is the easiest and quickest to scale since you reach customers using online marketing and social media that is available in any country of the world. The fourth reason is for all my subscribers and anyone watching who is not from the united states, this is why you should do business in the us and not in your country. So in my opinion, you should only do business outside of countries that are in communism and socialism, and where people are not hesitant to use their credit card to make purchases online. Trying to make money
in a country where people mostly buy with cash, is not a good option, So whatever opinion you have about them you should always be open to selling to americans. I've heard that some of you don't like or want to speak their language, but if you really want to make a lot of money online you have to know english and you have to sell your products to the us market. They are a capitalistic country , they have a lot more buying power and also they are used to shopping online. You should also sell to the us because of their large population so you don't create a barrier to how many customers you can reach Your first pick should always be the us and then other smaller english-speaking countries like uk canada australia. You should be able to reach a large enough market to make enough sales and enough traffic to have a profitable site. Picking a smaller population can
make your target market too small to reach the number of sales that you need to have a comfortable income from your online store. And also besides selling to the us, I would also recommend that you open an llc in the us, so you are not losing on currency exchange and also so some platforms allow you to do business that may not accept the country where you're from. Now that I've explained the types of online businesses, the benefits of having them, and why it's the best option for those of you who want to have a business of some sort, I'm going to talk more in detail about how i got to into e-commerce and about the problems that I faced along the way each month, so you know what to expect if you decide to do the same. So it all started around march 2020, when i came across videos about selling products on amazon.
And i've never heard about building an online business before that, but once i started learning more about it i was pretty convinced and thought how it was definitely worth a try. At that time i was sure that i wanted to go with that business model, but once i calculated how much it would actually cost to start doing amazon fba, i realized that it would actually take a few thousand dollars to start and then if i fail, i will lose everything that i've earned working in new york for those few months that i was there. Then in june, i came across videos about drop shipping, that cost less to start but it can make you the same amount of money. So that moment i decided to go for dropshipping once i get back home, because even if i do fail after launching my first product, i can easily start over once more or even a few times more until i succeed. So i got home by the end of june, and officially started learning how to drop ship two weeks later, in the second middle of july. I bought the first course that i came across and finished it about five days later, but since i wasn't really satisfied with what they taught me and realized how serious and complex running an online store actually is, i knew that i had to put much more effort in, stop going out and dedicate myself completely to learning and watching everything that i can from youtube.
In august i picked out the product that i was going to sell and started building my first drop shipping website. I picked out a fun fish toy for pets, that i knew wasn't going to make me a ton of money, but that would take me through the process of selling product products online and also that wasn't too expensive to ship products to my house, so i could take pictures of it for my website. That month i also won a free 20-minute consulting call with one of the guys that talks about dropshipping on youtube, after i left a comment on one of his videos. And he also helped me a lot by telling me what i should do next, what changes i should make and in general pointed me in the right direction.
So next i bought a domain, a logo, support email, 4 samples for the product that i was selling and also created a facebook page. I also tried influencer marketing, where you pay a famous influencer or a popular page on instagram to promote your product to their followers. I paid 83 dollars in total for a story swipe up plus promo post with a link that leads to my website, on over 10 a really big cat instagram pages with hundreds of thousands of followers, but ended up not getting a single sale and losing a total of around 235 dollars. Since i didn't get any sales i realized
that my site probably isn't all that great and needs improving, that what i know isn't enough and that i need to keep on learning. So in september i bought another course and it took me around 20 days to complete it. Then i realized that i have a huge problem with enabling card payments on my store. i basically couldn't accept any other payment method other than paypal which i had at checkout, which is not worth using because it can be problematic for sellers. So in order to provide customers with an option to pay with the card, i had to contact multiple payment processors, who would connect my and my customers cards and bank accounts once they buy something from my store.
So i applied for multiple payment gateways and got rejected because i wasn't a little eligible for any of them. After watching countless youtube videos about this topic, i realized that in order to be accepted, i actually need to register an llc (a limited liability company) in one of the countries such as the uk us, and open up a business a bank account that's connected to it, not only because of the taxes but because in order to have a card payment methods set up and available, you need to register your company. So as i said in order to receive card payments on my website, i applied for an llc in one of the states with no state tax and i also bought a VPN which made it look like i was living in the us. I also made my first sale of around 45 dollars from my facebook page that month, but still all of the cost in september left me in another minus of around 315 dollars.
So in the beginning of september i didn't make any further changes on my store and i started the the process of registering my llc and applying for a business credit card. But what i didn't expect is that i would have to end up getting a virtual card, since i got denied by all u.s banks from opening a u.s business credit card due to the fact that i had no credit history, and also i didn't expect
that both of these things would take me 20 to 30 days each to complete Once i got my document seven weeks later by the end of october, i wanted to fund my company's bank account and send the money from my serbian to my u.s business account through an invoice, but once again he has to wait for another few weeks until the middle of november to receive it and continue with doing my business. In the end of october i got another sale of 25 dollars, got in another minus of around 170 dollars and during those few months that it took me to register my company, open a business bank account and receive money to it, i found out about another similar drop shipping model, where unlike the low ticket option where you sell less expensive products for less profit, in high ticket drop shipping your store is like a catalog of big high-end expensive products like furniture, that if you sell you get a percentage for from the seller. So i started learning about them from 2 new courses and started building 2 more stores around a baby niche in the beginning of november, spent another 205 dollars, but never really got a chance to finish them, because shortly after i finally received the money in my new business bank account. And my new plan was to enable card
payments on my first tour and only focus on that one, since it was already done and ready to go So by the middle of november i thought that i was finally ready to start doing sales on my first store, but then i had the worst possible unfortunate events happen to me. So one day i went to change the general information in my stores from personal to business, like bank account, address, phone number and they all got shut down because of it for more than one month. So because those were so sudden changes, they flagged and banned my accounts after suspecting illegal activity, which was absolutely absurd to me, since that information was taken from my legal documents. At that moment i felt defeated like never before. I have been waiting for over two months to receive all the documents and was building my source for a few months only to lose them. So i had to find another solution
and i decided to register for some other online platforms and have them just in case. I tried ebay, but ebay banned me right after i registered with them, and commerce hq, which banned me first but then contacted me and after i submitted my documents they let me open another dropshipping store with them, which i would use as a backup in case shopify never let me back in with them. Aside from that i was still trying to get answers from shopify for weeks, and then finally after almost a month and a half, in the end of december i got my stores back. However, after seeing how quick shopify was to close down my stores without any notice, i realized that it actually might not be worth it to build a drop shipping business with them, just to have it closed in a critical moment. So while i was banned from shopify, in the middle of november i also found out and started learning about another business opportunity, which was affiliate marketing. i bought another course by
the end of november and seven days later started building a blog, which i was supposed to use to promote other people's products in a health niche and generate commissions from it. In december i got another ban, this time from clickbank because they detected that i had signed in from serbia, which wasn't one of the countries they allowed their platform. So next time i use the vpn that makes it look like i'm logging in from the us and then they have accepted me. Once i got in on that affiliate marketing platform i was ready to focus on learning about it from that course, to finish the course and then after i have my only focus be that blog and my first dropshipping store. In december i also spent a lot of money on recurring bills, that i had from all those stores that i had as a backup, which unfortunately cost me another around 300 dollars. That month i really started losing hope and having a lot of doubt because five and a half months have already passed and i still haven't gotten the results that i thought i would. i've experienced a lot of bans, store shutdowns
and was wondering how many failures do i really need to go through to succeed and even how maybe i wasn't even going to make it. Every day i would wake up with a lot of uncertainty and felt anxious about the rest of the day. I was afraid to take any further action, because i thought that anything that i would do would lead me to failing again. I felt very defeated by all the obstacles i had faced and i just had to take a break from the business to focus on my mindset and become more confident in myself. What helped me get through that period were the daily routines that i learned from watching other successful entrepreneurs videos, and that was writing down my goals and visualizing where i want to be and how i want to feel after in a few months or years after i achieved them. I got into learning about the law of attraction and started listening to success affirmations for entrepreneurs before bed and while i was sleeping. I read and listened
to a lot of books about success, money, personal growth and thanks to that slow change in thinking, i started believing how i can actually do it, which build up my confidence and gave me the strength to continue. Another thing that kept me going was this sentence - someday you will tell your story of how you overcame what you went through and it will be someone else's survival guide. So i would always tell myself this sentence over and over again, how i'm doing this not only for myself, but also because of all the people who want to hear my story and to know what to expect based on my experience. So all those things were helpful, but two men that gave me the most helpful advice when i came across them in january, were Dan Vas with his free course on youtube that's called - How to make your first million, and Tony Robbins with his - New world new you challenge that was also free back then. And yes, i know that i'm a course junkie and i'm sorry, but
I just love taking courses. But honestly both of them really helped me improve my mindset completely and changed my perception of my past failures. Dan Vas taught me that failure is a part of entrepreneurship and that i need to learn how to handle it and overcome it without feeling discouraged or giving up on my dreams. And also that if i do stick with it, i'm basically
already in the top 5%, because 50% of people quit after their first failure, 80% of people quit after their second failure and 95% of people quit after their third failure, so if i succeed after three failures i am basically in the top 5 % of people who stay after three failures and succeed. Tony Robbins also taught me that, if you want to be successful, you have to discipline your disappointment, you can't let it take over you and also that problems that we face in business or life are gifts that make us learn grow and expand It can either destroy you, if you let it, or it can create a breakthrough. So once i was finally ready to move on and move past all the disappointment that i faced, i went back to learning more about affiliate marketing. I came across another traffic source that you can
use with affiliate marketing products, i bought a course about native ads, finished it in 7 days, but decided that i actually don't want to try it out for myself. Right after i moved on from that, in the middle of january, i wanted to see and check if maybe i have been finally approved for google search ads, that i started and planned on using for my affiliate marketing blog. And when i saw what had happened, i was shocked! So basically what i did was, i registered to run ads on google and started a search ads campaign on december 31st. Usually it takes them a day or two to approve your ads, but for some reason mine weren't getting approved for another 2 days, 5 days, 7 days, 10 days and i just thought that it wasn't going to happen at all. Well little do i know is that, they approved me on the 14th, two weeks later without me knowing that they started running and spending money, and when i logged into my account on the 18th, i saw that my ads have spent a total of 556 dollars, which was never my budget! So obviously i stopped them and realized that there is just no point in running more ads to that blog, if i had already spent so much money and got zero back in sales.
The sad part is that the 150 google voucher that i thought i redeemed on the 31st when i started my campaign, i never ended up getting. So i contacted google support team and asked them if they can return me that money. They told me that i first need to unban my account, because yes, google has also banned my account because of suspicious payment activity, even though i paid off the full amount that i owed, which made no sense to me, and only then will they consider doing it. But anyways, even though my first affiliate offer didn't succeed i still believed that affiliate marketing was way better than dropshipping, because there was no dealing with customer service or shipping out products, only doing paid advertising. So i was willing to give it another shot and this
time, by the end of january, i came across a youtube video about high ticket affiliate marketing, which was promoting high ticket expensive products, like courses, on youtube ads and earning high commissions in return. So i did exactly what the video instructed us to do, which is make a list of all the courses you see are getting promoted, pick the one that has an advertising material already made, that has a webinar for people to watch and that has a commission cut of over or around 500 dollars. Once i found the course i liked, i made a youtube ad for it, which got disapproved at first, but once i fixed it and it started running, it spent 215 dollars and got me guess how much? Zero in sales. To be honest, the course i was promoting was 997 dollars, so i was supposed to spend at least the amount of my commission cuts to find out if i have a winning offer, which is something that i found out from watching 2 more free youtube ads courses, but considering the fact that i had already lost so much money; in february i just threw in the towel and didn't want to didn't want to lose or risk any more money. The way that it works
with affiliate marketing is that customers that i reach with my ads, get tracked with a pixel, and even if they buy 90 days from now, i still make a commission for it. So there's still a chance that i might make back some money, but let's say i don't, in january and february i lost a total of around 1120 dollars and made only 14 dollars profit of of my drop shipping store. That was actually my last sale, because not only have my shopify stores gotten banned completely randomly in january for the second time, but also the third time because shopify just decided to stop accepting my debit cards, even though i was using them for the past 6 months. It turns out that credit cards are the only method they accept, so in february i just had to say goodbye to shopify, because i don't own a credit card, and i also unsubscribed from all the online platforms that i had registered and account for. i decided not to use them any longer, because i was barely even using any of them, yet they were costing me 315 dollars a month. And just like that i decided to completely stop with drop shipping and affiliate marketing altogether.
So in conclusion after 2,300 dollars invested and 7 months of starting an online business, i still haven't made any significant amount of money online, even after going through 8 courses, almost 600 pages of notes, watching endless youtube content, visualizing myself as a successful online business owner and trying to manifest sales and profit using the law of attraction. None of that worked. i am a great example that even though you are diligent, dedicated, persistent, willing to learn and invest your time, energy, money, hard work and have the right mindset, sometimes even that just isn't enough. i would love to tell you that you will be profitable or succeed after your first or second try, but that most likely won't be the case, and it probably won't happen, even if you have all the resources available. Building a business is not easy or smooth sailing. There will be a lot of factors that you can't control
and there isn't a specific formula that will guarantee your results. Online business is not a get rich quick scheme, so don't expect this to succeed with little or no money, especially if you're a beginner. The nature of doing business is dealing with a lot of problems and challenges that come out of nowhere, that hit you the hardest and make you feel like it's the end of your world.
But you have to take what you can from it to improve and bounce back. You can't give up and you have to have thick skin, because you will struggle to get to a point of success. With all that being said, i know it might sound crazy, but i really am happy to have failed, because failure builds character. i don't feel like i wasted seven months because honestly i didn't. i learned so much about all aspects of online business and i learned a lot of skills that i know that i can make money with as a freelancer by offering those services to other business owners. i'm also happy that drop shipping didn't work out for me, because it involves way too much work for one person and affiliate marketing, which i can't really imagine doing long term. Most importantly, i'm grateful for
all the entrepreneurs that are watched on youtube, that taught me about money, finances, taxes, business, investing and about opportunities there are for making money online. i find it really inspiring how they have an income from their online business and how they can basically work from anywhere in the world, which is something that i also inspired to do and i'm willing to work hard until i get it. i know i didn't succeed with my first two businesses, but i'm ready to try again and this time a new one. Amazon fba is the one that i wanted to try out even before drop shipping and i like how with amazon, if you don't want to, you don't have to invest in marketing or deal with all the questions customers have about a product or shipping, which amazon fulfillment center and their customer support team handles. it does however require a larger budget, so my plan is
to first raise that money doing copywriting as a freelancer, which is a skill that in the past seven months i've enjoyed doing the most, and then invest that money into my amazon business. So right now that is my plan and what i plan on making my next few videos and updates about. Besides that I really hope you got value and learned something from what i shared in this video. My idea was to
show that failure shouldn't be a stigma and that if you do fail, it's okay to start over. Yes it might suck, but you just need to find another game plan and then put in even more work into that new thing to be successful. No matter what you do, challenges will always come up, but you have to do your best to deal with them, come out the other side stronger for what you have learned and pay the price for the prize. So go after what you want, don't be afraid to fail and if you do, just learn from your mistakes and do better next time. Thank you so much for watching until the end, it really
means a lot to me and be sure to subscribe, to like and comment and i will see you in my next video :)
2021-03-05 15:43
