Web home-based business is about to enter its highest growth phase with millions of new players piling in and exploding the market ? in other words a boom. If you're thinking about getting started - now is the time!
Some things in life are predictable. They follow known patterns that have happened many times before. Every industry there ever was goes through the same cycle in maturing. There is a period of invention and innovation leading to what is now called the ?tipping point' ? a moment when the business moves from a ?good idea' to an ?unstoppable force.' This leads to a period of growth, eventually a long maturity and finally a period of decline. How long the cycle takes varies between industries, but it ALWAYS happens. All that varies is the speed of growth and decline, the size of the industry, and most importantly the timing.
Well, when an industry is kicked past the ?tipping point' and into a boom period it is usually because of some conjunction of events. On the surface, the automobile industry was kicked into high gea by Henry Ford and the Model T, a car for everyone. But the Model T was only possible because of 50 years of evolution of the car itself and of production technology plus the spread of the ?idea' of personal transportation. These things had been coming for a long time. But when enough things were in place the industry took off. That's where web home-based business is right now.
Here are a few of the indicators:
? The infrastructure is in place as well as the tools for taking part: It may not be universal yet, but ubiquitous broadband is only a matter of time. Simplified tools for web design and web business management have been created and supplemented by hundreds of low-cost services. These inventions have dramatically lowered the cost of getting into business and reduced the risks that come with failure. This is already encouraging entrepreneurship and creating the conditions for mass involvement.
? Structure is settling into the industry: In the car industry, big companies like Ford and eventually General Motors, brought organization to the industry. They organized the thousands of suppliers and the huge distribution and service networks. This happens in every industry. On the web, the next generation of great companies is in place ? Yahoo, Google, eBay, iTunes, Rhapsody etc. Technically known as ?aggregators' they are creating focal points that web entrepreneurs can cluster around, buy from and most important sell through. The emergence of this kind of structure is indicative of an industry starting the maturing phase.
? An economic explanation: The last five years have seen the arrival of an economic theory tuned to the web. Basic economics works everywhere. But when a new phenomenon arrives economics takes a while to absorb its implications: just like it had to absorb mass production and account for the mass consumer markets. This is now done with the ?economics of abundance' and the concept of the 'long tail' explaining the dynamics of the digital world. Why is this important? Because without a unifying theory mass investment will not take place. With such a theory capital feels safe because it ?knows the rules.'
? Body of practice: The last ten years has seen the emergence of an understanding about how to make money on the web. Created by entrepreneurial practitioners, this ?body of knowledge' is highly fragmented. It is like the techniques used to sell cars in the 1930's: young and primitive compared with what will come; but for all that, a set of techniques that work. The techniques are spread amongst hundreds of individuals, what is needed is a ?bringing together', a codification so that the techniques can be taught to the mass market. This is what the business schools did in the mid-20th century. Programs are already starting to appear at community colleges a sign that knowledge is settling.
? Spreading understanding: Ideas spread predictably through a population. We know how it happens and we can measure it. But ideas that link technology and lifestyle changes often spread only with changes in generations. The first generation of web babies is reaching maturity. Children who started school in 1990 at age 5 are now 21 years old and adult. They have never known a non-networked world. This last point is vital. In the West, the employment experience of the next couple of generations will be dramatically different from that of the 20th century. Portfolio careers, multiple streams of income, unabashed entrepreneurship will be the norm as people go back three hundred years to the more economically self-reliant lives lived before the Industrial Revolution herded us all into factories.
These are classic signs of an idea that is moving past the tipping point; from a few innovators, opinion leaders and fast followers into the mass consciousness of the economically active population. Put all this into the context of a global, unrestricted market and you have ALL the ingredients of a boom. Are you ready?
Short note about the author
Michael Kay is Research Director of HBB Research a business school based research program looking at the phenomenon of web home-based business. He is the lead author of HBB Research's recent Report: The Gold Rush, the first compilation of a 'body of knowledge' on web business practice. To find out more about The Gold Rush and to receive your free subscription to HBB Insights, the ideas newsletter of HBB Research focused on starting and potential web entrepreneurs, go to http://www.hbbresearch.com/