The internet allows anybody to build a business that scales without any capital or employees.

Take The Joe Rogan Experience, for example. His whole operation is 4 or 5 people, yet the organization, if you can call it that, is worth hundreds of millions of dollars.

The only field that kind of scale could have been possible in the past is probably capital allocation, where one person can trade and invest billions on the public markets. Warren Buffett is a good example of this.

Only in the information age could a single person (or small group) have that kind of outsized return.

The Rogan Experience has become such a big deal that we forget he’s just some guy with a couple of microphones and cameras.

There are hundreds, or thousands, or maybe even tens of thousands of people who have stories just like this. They’ve created businesses that grow and grow without growing in expenses and overhead.

Justin Welsh is a well-known LinkedIn influencer who discovered a niche for single-person businesses. He started posting daily on LinkedIn 3 years ago, and now, doing the same thing he did when he started, generates over a million in revenue.

Sahil Bloom has a similar story but replacing LinkedIn with Twitter. He built a massive newsletter that makes $3-6K with every edition sent (he sends 2 editions a week).

One of the core aspects of being an online entrepreneur is understanding how setting up a small but powerful structure can get these outsized returns.

What’s the trick to building these small, scalable businesses?

1. Apply Strict Constraints From The Beginning

Warren Buffett famously says diversification is a great strategy for people who don’t know what their doing. He continues by saying when do you do know what you’re doing, put all your eggs in one basket and watch that basket closely.

Many online entrepreneurs, including myself, get caught in the trap of trying to do too many different things. A newsletter, podcast, courses, eCommerce, posting on every social media, blah blah blah blah.

There’s so much opportunity on the internet that it’s hard not to chase shiny objects. But doing too many things is a symptom of not being confident you’re going in the right direction.

If you knew, for example, that growing your Twitter following was going to get you more customers, you wouldn’t feel inclined to play with other ideas.

2. Don’t Work on Things You Don’t Own

Taking jobs doesn’t scale. I learned this by doing marketing consulting. We would get paid well to come into a business and help them do their marketing. Their business grew, and we collected our check.

As every agency struggles with, eventually, that business grew passed us. Then we would go our separate ways and be left with barely anything to show for it.

The only thing long-lasting for us were the things built indirectly - case studies, reputation, more competence, etc…

What we were not left with were the results we drove for our clients. That was all theirs.

It’s counterintuitive to reject working on things you don’t own, but the thing is, everything compounds like compounding interest. You should strive to be the person who benefits from that compounding.

The more money someone has, the faster they will make more. The larger an audience someone has, the faster they will gain more followers.

3. Focus on Evergreen as Much as Possible

Evergreen means once you build something, you don’t have to build it again.

A good example of this is instead of performing the same marketing services over and over again for our clients, building a course teaching people how to do it themselves and selling way more at a lower cost. Or building software the enables marketers. Or writing a book.

Those are all examples of things you can do once and profit from for years to come.

The only time you should do something that isn’t evergreen is when you are doing something that compounds over time.

For example, creating content for social media is not evergreen. But if you keep the same pace for years, then the results for the same level of effort in year 3 will dramatically outperform the results in your first month.

That’s it, folks. Those are some of the first principles involved in building a modern, low-overhead, scalable business.