Should You Build an Online Tutoring Business?




Deciding to be an educator can be quite rewarding in today’s industry, and thanks to how building an online tutoring business have revolutionized the entire methodology. Overall, the online education market is booming, especially since the global closure of all schools due to the corona pandemic.

As a result, online courses were popular even before the pandemic, but they were more concerned with enhancing education than simply repeating the school curriculum.

Now, the tables are turning for the better and for the worse. Education is a fundamental necessity for a person to live a happy life. Online tutoring classes were initially started to make education more accessible to those who cannot afford to attend institutions.

Given the current state of affairs and no other options, the entire teaching community had to resort to this idea. This has now become the preferred method of teaching in any field, including fine arts, music, and dance. According to analysts, online tutoring will be the next big thing in this market.

Most people who set up tutorials online or offline are looking for extra income. But what if we let you know you can also make lots of money and own your business thanks to this alternative?

To help you determine if this is your thing, we can help you by providing the necessary info and even make sure you get the steps for it right if you decide to start one.

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Tutoring Is in Demand, But Why?

Let’s start by understanding why tutoring is so popular so we can jump to the actual part that explains it all:

  • Both students and teachers find it convenient and practical thanks to the time they have to invest in it and its flexibility overall.
  • Teachers can reach out to more students at a given time and from different locations.
  • Interactive tools for self-paced, personalized learning.
  • Efficiently sharing study materials.
  • Instant feedback system.

Everyone’s first question is whether or not they are suited for the job. It is not a given job that everyone can do; it takes hard work and persistence.

But if you are someone with experience or planning to build, you can have a great time in this option.

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It Is Much More Convenient

Let’s face it; no one likes to have their sleep interrupted by an alarm clock that doesn’t stop blaring until they wake up. So, if we focus on the previous flexibility offered in time, you can understand where we are coming from.

Some days our bodies and minds need more sleep than they need to function well. There are also days when both parents and children want to stay in and not venture outside. Online learning is a great option for such times and another reason for you to start a business to explore the industry.

This huge benefit is probably the most influential reason people decide to get started in it.

Online tutoring is more convenient than traditional learning and can be used alongside a different schedule as the result of the previous factors.

This is particularly beneficial for busy people or those who will be the following kind of a hectic schedule, be it traveling or handling other matters and activities.

If you need a way to picture it, just think about how you no longer have to worry about driving to the tutoring center or home to teach your students. This will allow you to save significant time and increase your productivity.

Time is money from the perspective of a tutor. You make less money if you spend more time driving. You can also spend money on fuel.

This saves time and money, and you can take back-to-back tutoring sessions in the comfort of your own home. This makes online tutoring more affordable for families who don’t have to travel to the tutoring center or tutor’s house.

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Feedback & Prompt Results

Instant feedback is another benefit of online tutoring, be it one on 1 with a student alone or with several sessions.

A typical classroom contains about 30 students per teacher. This limits the teacher’s ability to give students the individualized feedback they truly need.

An e-learning student can instantly see the results of a quiz or test since this is how you design the tools you are utilizing, or you can provide the feedback in a matter of seconds, minutes, or hours. No matter when it is, it is faster than the regular method.

Traditional learning methods require students to take tests, then wait for their tutors’ grades. This can take some time depending on how many students are involved and when they see the signature or the system works.

Additionally, online learning allows students to ask questions and get answers almost immediately. Group discussions can be held with a tutor to facilitate, and students don’t have to leave their homes.

This also helps you as the person starting the tutoring because you don’t have to leave work for later. You can complete every task and element while tutoring and have the rest of your time free.

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You Can Use Pre-Recorded Sessions

Online learning allows tutors to record one session and upload it for students, or even upload an entire course and upload it unless students are expecting a live option you’re supposed to give them.

However, overall, both the tutor and students benefit from this: the tutor doesn’t have to put in the unnecessary effort, and students can rewatch the recordings until they are fully absorbed.

Not all courses and classes are recorded. Some are life via online platforms like Zoom and Groupworld. This format requires students to be present at a set time.

However, 1-1 online tutoring gives students the best support. Students can ask questions and make even faster progress.

You’ll Get Higher Retention Rate

Online tutoring has a number of notable advantages. It uses multimedia more effectively than traditional learning. This is undoubtedly a benefit that helps increase retention rates.

According to the Research Institute of America, online education can increase student retention by as much as 62%, according to their study. Are you still unsure if e-learning can be effective? Or if this is something you can bet on?

Online learning allows tutors to combine text and images with videos so students can understand the material better.

E-learning can incorporate many tools and multimedia forms. Many of these tools cannot be used in traditional learning. Even if they can, their limited availability and timeframes may hinder their use.

For this reason, many are choosing online tutoring over traditional one, and as someone who has taken it, we would highly recommend going for the digital opportunity.

Content Regularly Updated

The textbooks are the foundation of traditional learning. It is difficult to provide up-to-date content regularly because its time to create and publish textbooks. Students are often limited to one textbook, and you will also have to work with one material in specific.

However you see it, this is the only limitation in every aspect.

Online learning models eliminate this problem because, with digital courses, it is easier to update material than physical textbooks. Therefore, the vast majority of online course content is more up-to-date and diverse.

This will also help you be comfortable, and if you aren’t someone who can’t afford to have all the books or don’t want to have them around you but instead with just one click, it can be the best option to rely on online in every detail.

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However, There Are Too Many Distractions

Not everything is perfect with a method, and the biggest con for online tutoring for both students and teachers is how many distractions you can have.

It’s difficult to become distracted in a classroom because the teacher tends to keep the students focused. Online learning may be different.

Online learning is convenient, but it can also be a distraction. You may find students distracted by phones, other windows on their computers, or yourself trying to focus and start working. Whether it’s the temptation to surf the internet or just a notification, it can be hard to stay focused.

This is why you must evaluate two factors:

  1. Are your potential students disciplined enough to take your classes with the utmost attention?
  2. Can you focus and stay like that for hours or while teaching?

You Are Fully Responsible

Unlike the traditional method where other teachers or headmasters are involved, you will need to take full responsibility for anything that happens and how the students learn.

Remember, online learning is not as physical as a classroom. As previously mentioned, this makes it difficult for students to concentrate on their work. This places a higher level of responsibility on the student for their learning but also you as a teacher to go beyond the usual to get the desired results.

Organization, time management, and self-discipline are key to online learning, and not only on the students’ side.

Although online learning may seem more difficult initially, it is possible to make it work. If not, no one would decide to start a business when considering this.

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Where Does This Leave Us?

So far, it feels more like a list of pros and cons with online tutoring, but these factors are the crucial ones to decide whether this is a business you want to bet on or not.

Most people focus on the students’ issues with online learning, but we believe it is a matter of both sides and how you will handle this as the person trying to start it.

But without going in circles, you need to consider it is actually worth giving this a try.

You get freedom and flexibility; you can treat it as the main source of income or get extra without much effort.

Just make sure you are qualified for this and ensure the best for your students regardless of your area of expertise and focus.

When weighing the pros and cons, you will notice that the first always wins, but you need to be sure about yourself and handle this business option.

With that in mind, how can you start with this? We will help you in that matter too.

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How to Start an Online Tutoring Business

You might expect that education is a key requirement to start your tutoring business, and you are kind of right. Most tutors must have at the very least a high school diploma. This is especially important if you sign up for an online tutoring website or decide to build your business.

After all, people are looking for qualified tutors, not only some who have worked in some jobs or places without any particular preparation.

Your education level is an important factor in choosing the content areas you can teach and why some will hire you (most people). These are the subjects and grades you can teach with each grade level of education:

  • High School Diploma or GED: You can tutor middle and elementary school students at this education level. High school students can also be tutored, but you will need to show your knowledge using transcripts or standardized test scores.
  • Undergraduate Degree: You can tutor middle and high school students with a bachelor’s degree. You can also tutor college students in the area you specialize. This is especially true for those who have worked in your area of specialization after college.
  • Post-Graduate Education: You are able to tutor students in elementary, middle, and high school. You might consider teaching adults English, depending on your specialization.

You should consider pursuing a tutoring certification as you explore tutoring. You will need to complete a training program, go through a background check and write a couple of letters of recommendation.

A tutoring certification can increase your credibility and show parents that you are trustworthy around students. The training that comes with a tutoring certification is beneficial to many tutors.

To begin tutoring, you must identify your specialization as well. Consider where you can bring value and what you know. Are there particular content areas or grades that you are proficient in?

When you are looking for your specialty, think about the areas where tutors are most in demand. These include English, Maths and Science. Each subject can be sub-categorized into Chemistry, Algebra, Reading comprehension, SAT preparation, and ACT preparation.

After you have chosen one or two specializations, you are ready to move on to the actual steps of building your business:

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Create Your Business Plan No Matter What

A strong plan is a key to building a successful business. If you’re not familiar with it, a business plan is a written description of your business and strategy.

This is your vision of your business organization, its operation, and future prospects. There are many resources online that can help you write a business plan. You can also find resources at your local chamber of commerce or government economic development agencies.

However, we would help you by just mentioning what it typically includes:

  • Executive Summary.
  • Company Description.
  • Market Overview.
  • Marketing Strategy.
  • Operating Plan.
  • Organizations & Management Team.
  • Financials.

Once you have an idea of the business model, it is time to calculate your start costs. Are you going to need teaching aids or materials? Are you going to pay for web hosting or website-building software? Are you looking to buy hardware and software? Or purchase business insurance?

Your business plan doesn’t have to be complicated, especially if your company is just starting out. This plan should be used to establish goals, develop a marketing strategy, and forecast your business expenses.

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You Will Need the Right Computer Setups

Next, you need to set up your classroom. You will need a location in your home where you can conduct online tutoring. It is important to choose a location away from the noise with lots of light. From there, make sure you are in a neutral location for video calls.

It is important to ensure that you have the right technology in order to start online tutoring. A computer and a fast internet connection are essential.

A webcam, as well as a functional microphone, will be needed. We recommend buying a tablet, digital drawing pad, and stylus to use with virtual whiteboard software. These tools will make it easy to share ideas with students remotely and make your classes more practical, aesthetical, and even fun.

Choose the Right Tutoring Software

After you have the hardware in place, it is time to choose your software. These types of software are worth considering:

  • Video calling software: Use a video calling program like Zoom, Google Hangouts to set up meetings and send them to attendees via email.
  • Virtual Whiteboard Software: This one lets you draw, write and diagram on a whiteboard. You only need a mouse to use the software. However, a tablet or digital drawing pad with a stylus will give you greater control.
  • Document Sharing Software: Remember to use the free Google tools to your advantage. Google Docs is a great tool for sharing documents and editing at once. You can also comment on individual parts of the document. Google Classroom further enhances these tools.

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Set Your Rates

You are the boss and can set your own rates for your services. Rates can vary greatly from tutor to tutor and are usually determined by your education, your subject area, and the learning needs of your students.

Tutoring rates typically range between $20 and $80 per hour.

Those who are skilled in teaching high-demand subjects such as science and math at college and high school levels, or SAT prep, command the highest rates.

Tutors often charge higher rates with experience and training in working with students with special educational needs as well.

Hourly rates can drop when tutoring online rather than in-person. Online tutoring is more popular because there are many tutors available, and this means you have lots of competitors, but also people want to pay less because they don’t need to see you in person.

According to our research, the hourly rate for tutoring online is realistically between $20 and $30. However, you may charge more depending on your education and experience.

When you are deciding on your pricing rate, consider the rates charged by tutors in your subject area. Next, think about your expected business expenses, such as software costs, taxes, and time spent preparing for each session.

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Register Your Business Legally

Technically, it is often unnecessary to register your business, but countries adapt to this new online option and might need you to register an online business legally.

To address this, tutors who decide to open a sole proprietorship or partnership business do not have to register. The business acts as an extension of the owner.

Sole proprietorships can be set up quickly, and taxes are usually easier than with other forms. When you file taxes for a sole proprietorship, you must file your personal and business taxes together.

Earnings will be subject to self-employment tax. Sole proprietorships don’t have the same liability protection as other business structures. Any debts that your business incurs are your responsibility.

Other forms of incorporation take longer to set up and have their own benefits and disadvantages. These are the most common ways to incorporate and the options you usually have:

  • Limited Liability Corporations: Many tutors consider an LLC their best option because it is less complicated than a corporation. Each state has its own rules regarding how to create an LLC, which is important to remember.

You don’t have to register your LLC in every state, although you should. LLC owners must report the business earnings and losses to their personal taxes, just like a sole proprietorship.

  • C-Corp: Shareholders are considered to be the owners of a C-corps and receive limited liability protection.

Corporate officers, who may or not be shareholders, make business decisions. Taxes in this business model are separate from personal taxes. Shareholders pay income tax on dividends. You must file articles with your state in order to create a C-corp.

  • Scorp: They are very similar in structure to C-corps. However, there are a few restrictions. You can only have less than 100 shareholders, and all of them must be U.S. citizens. Personal taxes are used to report profits and losses. You will also need to file IRS Form 2553 in addition to your articles of incorporation.

Even if your tutoring business is a sole proprietorship, we recommend that you create a plan to separate your personal and business finances. Separate savings and checking accounts are the best way to separate your finances. You can track your profits and losses more easily with these accounts and save a lot of time when you have to pay taxes.

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Start Establishing A Web Presence

It is essential that you have an online presence as a tutor. There are several ways to build it to bring your students and work with the actual people you need:

  • Make a Website that Looks Great: A sleek and attractive website is a must. Your business can be more credible and build buzz for your services by having a website.

Many website builders can be used to quickly and easily set up your site. You can even use some of these tools, such as Wix, to schedule appointments and allow clients to pay online for their tutoring sessions.

  • Create Social Media Accounts: Register your business on the social media platforms your clients use most often (Facebook and Instagram are great places to start). Include important information such as your subject areas and a link back to your website.
  • Create a Yelp Page: Now is the best time to create one. Yelp pages encourage clients to leave reviews and can be used to direct potential clients to your business.

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Select a Payment Processing Solution

You will need to integrate with a payment processor in order to accept online payments.

Two types of payment solutions are available: Payments service providers (PSPs) and merchant account.

PSPs can be set up quickly and are often easier to use, but they also have problems with account stability. They often accept merchants quickly, but after reviewing their data, they decide that some merchants are too risky to use their platform. They then freeze their accounts.

Merchant accounts take longer because of the initial review process and are more stable and less likely to be canceled whatsoever. But why choose this option? Because the account will allow you to negotiate the rate you pay for payment processing.

You will need a payment gateway to make online payments through your merchant account.

These payment processing options might be a good fit for you:

  • PayPal payment method is the most popular and widely used. It is also a very familiar option for clients.
  • Square is another good PSP. It has appointment scheduling capabilities so clients can both scheduled sessions and pay for services simultaneously.
  • Website builders often have their own payment options. Wix payments are one of these options for Wix customers. These integrated payment solutions can be used to set up a payment method quickly.

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Start Your Marketing Process

Now it’s time for you to market your tutoring business and ensure you are bringing customers your way.

Your marketing strategy must take into consideration your existing network and your intended audience. Here are some options:

  • Email Marketing: Notify your existing network about your new business. You can use email marketing software such as Mailchimp with information about your tutoring services to reach family and friends.
  • Social media marketing: You can use your personal or business social media accounts to promote your business by uploading or linking to your favorite learning resources. Create a few videos showing how you prepare for tutoring sessions or anything that comes to mind.

These videos and resources can be shared to show your teaching style and personality. This can build your reputation and make it easier to approach people.

  • Post-in-person flyers: Put fliers with tear-off labels on bulletin boards at libraries, churches, and schools.
  • Share Customer Testimonials: Ask satisfied customers for a positive review and then use that testimonial in your favor. Word of mouth is a powerful tool so use it as much as you can.

Ready to Start?

Keep in mind that some people just take it slow. For example, you don’t have to build a website but rather focus on offering your services on platforms like Upwork, Fiverr, or similar freelance platforms.

The important thing to remember is to build a business thanks to how you work in your brand.

Therefore, don’t focus on a specific “setup” for your online tutoring business despite its worth. You can just work around the general alternative and start building your own property once you are more established.

The Local Lead Generation Process for Your Online Tutoring Business

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All right! So, everything is about building properties and generating leads. But how does the process actually take place? Are there other steps I need to know?

The steps I mention below are what students from our local lead generation program follow to generate leads for businesses like yourself. So I’ll help you see what we do. And how if you join our program, you can simply generate leads for your own business (unless you want to start a side hustle and build a laptop lifestyle business).

Essentially, our lead generation can be divided into four steps:

The first is prospecting. You need to take the time to do market research on a niche (industry) and determine how many phone-driven businesses are there.

Keep in mind that this is local research as you need to know how many companies need leads. For example, you may search for “plumbing services Youngstown OH.”

You will find dozens or even hundreds of businesses trying to get themselves in front of the customers by ranking on Map Listings, organic results, and even Ad.

The second step, building. When you find a niche (plumbing, tree services, a software company, real estate…), you will need to start building your digital properties. You don’t need to be an expert in HTML or coding. It can be easy with the right tools.

The third step is now taking time to rank your lead gen website. With the site done, you need to work on SEO strategies and start dominating those Google search results. If you’re new to SEO, it stands for Search Engine Optimization.

To keep it simple, it consists of the entire process of growing a company’s visibility on search engines like Google and generating organic traffic. And remember this, local lead generation is part of the strategies.

Moving on to step four, once you rank the site, you will start getting your ROI and profits. You only need to rent it out to a local business interested in the leads the site generates. You can offer a couple of free leads to their move on with the actual pay per lead.

To review steps 1-4 above, I described it to a normal student who is building a lead gen business to help local service providers generate more calls. But replace the student with you as the business owner. And replace sending the leads to a business to simply siphoning the leads to your personal business.

By the way, fun fact, about 20% of our students in our local lead gen program are actually business owners who went through the program. And they use the skillsets we teach to generate leads for their own business.

An Example of Lead Generation: Home Advisor

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You must be thinking, “if lead generation sounds so good so far, how come I haven’t seen any company?” That’s the thing; there are many out there. You just don’t know they are dedicated to it.

HomeAdvisor is one of the best examples you can find on the Internet as it is a top lead generation company that has spent millions building its brand but also earned even more zeros for this same reason.

They started small as everyone else but invested in building their brand awareness to make people who are looking for home services go to their website and find what they need. They are over 75% of people’s first choice when they need those services.

If you don’t get HomeAdvisor that much or need a refresh, users need to submit their information to request a service and get a professional or expert who can provide it.

HomeAdvisor’s job is to share your information, which makes you a lead, with local companies so they can contact you and offer the service you’re requesting. For sharing this lead information, HomeAdvisor gets paid by the companies. This happens for every single lead they send to multiple businesses.

Business owners who don’t have marketing skills or don’t even know how to have any online presence will always rely on those pages to list their services.  They will save time and effort, but companies like HomeAdvisor can make them spend lots of money as leads aren’t exclusive (one lead is sent to multiple companies after all).

Using Facebook Ads aka Paid Ad Platforms: Do They Generate Leads?

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They DO generate leads. If not, no one would use them.

However, you need to remember two facts:

  1. Paid ads or platforms can be expensive.
  2. They don’t generate “natural” leads.

Whenever someone sees or clicks in one of those ads, over 80% of them did it by accident or are trying to close/report it.

Why? Because they aren’t looking for those services. At least not at the moment.

What those ads do instead is interrupt their time on the platforms. Users aren’t there to find companies or businesses unless they are searching for a specific company’s user, and for that, there’s a search bar. This is why it is hard to convert them to actual customers who will show interest in the companies’ services. Also, you’re limited by a budget.

When using lead generation, everything is organic. You aren’t forcing others to pay attention to your business but rather being there when they need you. This is why Google’s organic traffic will always beat paid ads, and the reason companies continue investing in it, which is a lot cheaper as well.

What Is Local SEO?

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Don’t worry… I didn’t get it at first either. Following the short explanation, local SEO focuses on scaling businesses’ visibility on search engines. However, this is only for those who serve their communities face-to-face.

What does this mean?

Experts and professionals like painters, plumbers, and dentists (but not only them) offer their services to their local customers. Why? Because they can’t deliver them unless they are located in the same area of their customers.

To make sure those businesses get more leads, you need to rank them locally by claiming the business listing on Google to place them on Map Listings. Local SEO also involves online reviews, citation management, and how you manage your entire online presence in the local area.

If you are going to bet on lead gen, you need to adapt yourself to today’s world: The Internet.

Keep in mind that although traditional channels and methods like billboards, warm calls, and pamphlets still work, they aren’t part of your tools. Whenever someone needs a service, they go to Google and search for it.

“Dentist in Miami” or “plumbing services in Orlando,” etc. And you can keep coming up with services or professionals people need and look for. Thus, you need to make sure you’re using Google to get the companies in front of their clients.

Users will always click on the first search results (those near the top), and many of them will be either Ad links (people paid to place their websites there), Map Listing, and then you get websites. Almost all of them are your goal and where you should always aim to place yourself.

Can My Tutoring Business Utilize a Local Lead Generation Strategy?

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If you want customers, you better know you need it. Following the previous explanation, lead gen is all about placing businesses in front of their customers, choosing them over their competitors.

Put it simply – it’s all about closing deals and having clients for those companies to make money. The main difference with the usual methods companies use for this is how lead generation approaches different channels to get them in the right place of the market to get customers.

Those channels are all focused on the Internet as most people are searching for products but also services across the net. The issue is that the Internet is way too broad, and businesses don’t know how to place themselves. They usually try, but they get one common result: losing money and time.

How Powerful Are Organic Tutoring Leads from Google?

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For companies looking for customers, it’s everything. For you? Pretty much the same. When you build a business with digital properties, you get to make thousands of dollars a month.

This isn’t a “get started today and get rich tomorrow” thing, but it is HIGHLY scalable, and ROI + positive results are guaranteed. Learning a fairly decent and very needed set of skills to create your digital properties and start ranking them on Google is required.

I have invested in several online businesses over the years, and if there’s something uncertain, whether you will get your ROI or not, even more than the actual profit.

However, this business moved my earnings from five figures a year to a month in ONLY passive income while sitting comfortably at home.

On my laptop. Anywhere. Anytime.

You can look at one of the first sites I built back in 2016, and it continues making me over $1.000+ every month. The best part is that I don’t need to touch it or the rest I’ve built over the years, just like this digital property.

What Makes Lead Generation SO Alluring?

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Here it goes: you can work from home.

The main issue with regular business opportunities is how much you need to invest in staff, equipment, or rent to have a place to sell your products or offer your services.

We all know the hassles of traditional businesses that involve regular expenses, which are extremely high.  Can you afford it? I don’t think so, and even if you can, is it worth it? Now, it isn’t only about the money. You also need to put in a lot of work, and it isn’t only during the first couple of months or years. Usually, it is as long as you continue running it.

You can save yourself those headaches and bone-breaking tasks and expenses with lead gen since it is more about generating leads with digital channels—mainly websites.

Websites can be VERY cheap to build, and with many tools online, you get to do it in a couple of hours instead of days. Any virtual or digital business is scalable and won’t need constant maintenance.

So, let’s summarize this:

  • You save money in regular expenses with traditional and most online businesses as what you need is yourself and digital properties (websites).
  • You can bet on passive income.
  •  There’s no need to hire more people to get started.
  • You can generate leads in multiple industries, which allows you to work on any niche you want.

How Can I Get Started in the Local Lead Generation Program?

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Anyone can start and learn. That’s the beauty of this business model. I knew nothing about SEO, Map Listing, and everything I’ve mentioned so far. It is all about learning the skills, gaining experience, and deciding to take the step.

Remember that this business model will never get old as business owners are always looking for leads. They need to do business and scale their companies. Why not do the same while helping others and still making money?

You can start with this local lead generation course highly recommended for anyone wanting to grow in the business. It is a close training that will take you through each step and make sure you are able to get your ROI, profits and take control of your life.

You will be added to an incredible lead generation family ready to help you 24/7 when asking questions on the group. Anyone is welcome who’s willing to put in the work. Click here to watch the lead gen webinar.

Learn more about local lead generation below.

Take a sneak peek into our proven strategies to build a passive income by building a local lead generation business from your laptop...