Small businesses have long been the lifeblood of the U.S. economy, creating more than half of the nation’s jobs, spawning new ideas, generating 54% of U.S. sales and fortifying communities across the country. This momentum shows no signs of slowing down, with some predicting 40% of Americans will be self-employed by the year 2020.

Websites, stores and applications will be the cornerstones of these new businesses and entrepreneurial ventures. Small businesses have shifted from dabbling on the web with cookie-cutter sites to being completely dependent on the web. At Liquid Web, we refer to these businesses as being web dependent to demonstrate the incredible importance of the web for these online SMBs that derive up to 100% of their revenue from their online presence.

These businesses include:

  • Content sites that monetize content via subscriptions, advertising and referrals
  • Online stores
  • Niche application providers that have tapped into the explosive demand for web and mobile applications

It’s easier than ever for an entrepreneur to launch a web-dependent business. The first step is to choose and purchase a domain name aligned to the brand. Then, secure a merchant account and payment gateway to start collecting payments. E-commerce sites will also need an SSL (secure sockets layer) certificate to encrypt sensitive data like customer identification and credit card information.

Industry Disruption Takes Hold

Many of the industries these businesses belong to are facing disruption. What was once housed neatly in a brick-and-mortar location, open 10-6 and competing only with neighborhood offerings is now online 24/7 and facing steep competition from online juggernauts such as Amazon.

Uber, Netflix and a dizzying array of other brands have proved that disruption is no longer part of a passing trend but part of the new normal. This means more and more businesses are falling into the category of being web dependent, which is good news for a growing small business segment that has historically been overlooked for being too small. Many of these businesses may have five or fewer employees, but with a robust online presence, they’re able to perform the work of much larger organizations.

When the overall success of your business is dependent on a strong web presence, it brings about an entirely new set of considerations — a hosting partner perhaps being the most important. A recent survey we conducted revealed that 86% of respondents believe that selecting the right hosting provider will affect a company’s competitiveness.

One of our customers, a software-based marketing company, experienced this firsthand. When launching promotions for new products, it was critical to have a reliable server. Continued issues with server capacity mean downtime for customers. These problems could result in lost sales, and when the hosting company was unresponsive and unable to bring the server back up, it directly impacted the amount of money the company was able to make.

When your business is web dependent, security is also of heightened concern. Another one of our customers was at one point faced with client websites under frequent attack by hackers using malware and carrying out DDoS attacks. The consequences for this type of attack can be grave, particularly for banking and insurance companies. If left unchecked, a business can find all of its email servers blacklisted so that its email is not accepted by other web servers.