How much do online business owners earn?

Photo credit: Jacob Lund / Shutterstock

In recent years, there has been a noticeable increase in the number of people starting new business ventures. This growth began in mid-2020 due to a variety of factors, including record low interest rates, increased reliance on digital tools, and changes in workforce dynamics. While successive interest rate increases have cooled many aspects of the economy, they have had little impact on new business creation, which remains at near-record levels. As a result, more and more people are exploring entrepreneurial opportunities, but many have no insight into how much these new business ventures can actually earn.

To help potential business owners better understand their earning potential, Flippa – the largest online business buying and selling platform – analyzed its internal data on over 25,000 profitable companies listed on its platform over the past two years. Below is a summary of the findings.

Revenue by type of business

The largest revenues are generated by businesses in the e-commerce, services and SaaS industries

Source: Flippa market information from 3 years ago (2022-2024) | Image source: Flippa

The financial performance of online companies varies greatly depending on the type of business. E-commerce, service-oriented, and software-as-a-service (SaaS) companies tend to earn the best compared to ventures based on marketplaces, mobile applications, and content. For example, mature e-commerce companies boast an average monthly revenue of $21,497, with the top quartile reaching $59,021 and the top 10% earning an impressive $119,141.

The success of e-commerce businesses in recent years can be attributed to several factors. First, the widespread consumer shift towards online shopping, particularly accelerated by the pandemic, has increased demand for e-commerce platforms. Additionally, new order fulfillment methods – such as Fulfillment by Amazon – and advances in digital marketing strategies have improved the scalability offered by e-commerce business models.

Similarly, service-oriented and SaaS businesses are seeing significant revenue growth, with average monthly revenue of $13,898 and $17,252 respectively for mature ventures. These companies thrive by providing specialized products and services tailored to the specific needs of customers. The specificity and personalized nature of these offerings often lead to higher pricing levels and recurring revenue streams, which improves your bottom line over time.

In contrast, marketplaces, mobile apps and content-based businesses face greater challenges in generating revenue. Marketplaces often struggle to achieve scale due to intense competition and the need for significant investment in platform development and user acquisition. Mobile apps face monetization hurdles due to market saturation and users’ reluctance to pay for app downloads or in-app purchases. Similarly, content-based businesses also face monetization challenges as revenue streams rely primarily on advertising or subscription models, which do not always translate into significant profits. Additionally, wild fluctuations in organic traffic due to Google algorithm changes can lead to uneven revenue growth.

Below is a complete breakdown of average monthly income by age and business type. Monthly revenues from the top quartile and top 10% of companies are also provided for context.

Average monthly income by age and type of business

Revenues tend to increase as businesses age

Source: Flippa Marketplace Listings (2022-2024) | Image source: Flippa

Top countries by operating revenue

Online companies based in Singapore and the Netherlands report the highest revenues

Source: Flippa market information from 3 years ago (2022-2024) | Image source: Flippa

The countries reporting the highest average revenues for internet companies are diverse and include Asia (Singapore), Europe (Netherlands, Ireland, Germany, UK and France), North America (US and Canada), Middle East (United Arab Emirates) and Oceania (Australia ). In particular, Singapore stands out as a global leader in the financial performance of internet businesses, with revenues of $60,552, $219,085 and $424,926 for the middle, top quartile and top 10% of mature companies, respectively. Singapore has recently become the most popular destination for technology companies expanding in Asia. According to the Singapore Economic Development Board, 80 of the world’s 100 largest technology companies are currently present there.

Together with Singapore, top-performing countries in terms of average business revenues tend to benefit from strong digital infrastructure, a favorable regulatory environment and high levels of technology adoption. Compared to the global average, these countries also have a high concentration of e-commerce and SaaS businesses. In contrast, countries with lower average incomes tend to have lower concentrations of e-commerce and SaaS companies and are often hampered by factors such as limited access to technology infrastructure, lower levels of technology adoption and more challenging economic conditions.

Most popular US states and territories by business revenue

The most successful online companies are based in Puerto Rico

Source: Flippa market information from 3 years ago (2022-2024) | Image source: Flippa

In the United States, the average revenues of online companies vary greatly. Among the top 10 states for middle income are several states you might expect, including top tech and economic hubs like California, New York, Texas and Washington. However, the most notable finding is that Puerto Rico tops the list, recording average revenues of $65,975, $209,124, and $401,644 for the middle, top quartile, and 10% of mature businesses, respectively.

Over the past decade, Puerto Rico has attracted a large influx of internet technology companies through the implementation of attractive tax incentives and economic development programs aimed at encouraging companies to set up operations on the island. As a territory, Puerto Rico and its residents enjoy distinct tax benefits that differ from the federal tax laws of other states. As a result, Puerto Rico was able to create tax credits and exemptions tailored to eligible businesses – such as technology and software companies – and their owners who chose to relocate there. Notably, Acts 20 and 22, known as the Exported Services Act and the Individual Investor Act, cap the corporate income tax rate at 4% and provide 100% exemption from interest, dividends and profit sharing. These incentives have enabled Puerto Rico to attract a large concentration of high-profit businesses to the island.

In addition to Puerto Rico, Georgia stands out as the top-performing state in terms of corporate financial performance. Known informally as the “Tech Capital of the South,” Georgia has become a top destination for fintech and payments companies – an estimated 70% of all U.S. transactions handled by payment processors located in the state – as well as cybersecurity, healthcare technology, and e-commerce. Thanks to its high concentration of SaaS and e-commerce companies, Georgia has higher average revenues for its online businesses than every state except Puerto Rico.

Methodology

Photo credit: Jacob Lund / Shutterstock

The statistics presented in this study represent profitable companies listed on the Flippa Marketplace from January 2022 to present. All data shown is for the month.

For full results, see How Much Do Online Business Owners Make? on Flippa.