The Virtual Company: What Is It?

People ask me this all the time, and it's a great question.

If you're not used to working online, then the idea of something being real and invisible (not right before your eyes) can be a hard concept to wrap your brain around.

A virtual company can take a few forms:

It can be an internet business where the team of staff work from their own locations.

Not sure what an internet business is?

Think of Amazon.com, Woot.com, any online membership site, and tons of other types of sites where the website itself is the "marketplace".

An internet business can survive without a brick and mortar store--the "store" is the website.

The great thing about an internet business is the lack of overhead--there is no store that you need to rent and insure, there are no offices where you need to house a receptionist and workers, there is no need for you to provide office supplies and equipment for your staff.

There is also no need for your team of staff to be in the same building or even on the same continent. You don't need to have employees--instead you might just partner with individual business owners who specialize in the services that you need.

The business is just "out there" on the internet. Your staff works on your business by connecting to the internet and doing their assigned jobs (customer service, web design, marketing, sales, etc)

Some people think that sounds weird, unreal.

I've talked to a lot of people with internet businesses and even some of them agree that it's a bit surreal. The business that is paying their livelihood is completely on a website. If the website were to disappear (for some catastrophic reason), so would the business (until they could get it back online).

Interesting point: Not every internet business is a virtual company. Some internet businesses have traditional offices where their staff work, and they function pretty much the same as a "regular" (traditional) business. What makes an internet business a virtual company is how the business functions, rather than where the business is located (whether it's online or not online).

Services Provided At A Distance

Another variation of the virtual company is the buisness owner who provides a service or skill from a distance. Maybe he's a business coach who provides consultations over the phone. Maybe she's a web designer who is commissioned to create sites for clients who live anywhere in the world. Maybe he's a writer. Or maybe she's an online branding consultant who works with brick and mortar businesses from a distance.

If this "at a distance" service provider needs help with running his business, he can turn to virtual business owners--virtual assistants, web designers, SEO specialists, etc.

A virtual company could also be offline...

Let's say you've got a product that you can hold in your hand. Maybe you outsource the construction of that product to a company in a different location. Then you enlist the help of a distribution center to ship your product when someone orders it.

Your assistant is a virtual one--she or he does not work in the same place as you. Most likely she works from her home, some place else in the world.

Your technical staff is in different locations too, and you work from your home or maybe have some office space that you've rented for yourself.

Most likely, even if the business is not online (like an internet business), your team will use the internet to connect with each other, your customers, and you.

The internet is the what makes the virtual company possible.

A virtual company can have employees.

Lots of virtual companies rely on outsourcing and may have no employees whatsoever. Some do though, and they just set things up so that their employees can work from home. The employer pays for the computer equipment and any other technology needed to work from home, but the employee pays for the electricity needed to run the equipment, his desk and office chair, and the internet connection.

Here are some common charactersistics of virtual companies:

• There is no need for physical office space or a brick and mortar store (although some business owners may one day decide to rent office space for themselves or open a storefront).
• The staff who works on the business can live anywhere in the world.
• The staff can usually work during their own preferred time schedules (there's no need usually for all the staff to work the same hours or any particular hours at all).
• The staff can work from their own homes and on their own computer equipment.
• The internet is a key component in connecting the staff with the business owner, with each other,  and with customers.
• The staff are not employees--they are often independent business owners who work as consultants to the business. They bill the business owner for their services, have their own business priorities and guidelines for their own businesses, market their own businesses, and use their special skills to contribute to the success of the business owner who has enlisted their services.
• Allies to the virutal company owner are Virtual Assistants, web designers, software designers, freelance writers, and other people with virtual businesses who provide services that the business owner needs.
• The technology needed to have a virtual company is pretty basic: computer, internet connection, some free online communication tools (skype, gmail, etc) and maybe a phone (could be your cell phone).

Now, the next time you hear someone say that their business is "virtual", you'll have an inkling about what they mean.

Is your business virtual?

If so, please share how your virtual company functions (Is it online? What work do you outsource? How do you communicate with your team? Do you work from home?)