One option to keep overhead low can be operating your company largely in the virtual world.

Though website businesses are often created in this way, a variety of other businesses including mail order, software, and even book publishing and other companies producing largely intellectual property can be built in this way.

Some important steps shared by Hal Barbour, president of CAST, a company specializing in Internet Protocol platforms in his article "Cultivating a Company in Cyberspace" include:

• home offices. Recent advances in communications, computing, and Internet services make it possible to operate from home offices much more productively and cost-effectively than from expensive, central office space.

• Communications storefront. Advanced telecommunication hardware and services give our "virtual storefront" the outward appearance of a much larger company.

• Web-centric business focus. From sales and marketing to product delivery (we have an advantage here, being a software company) and issuing invoices, nearly all our critical business processes utilize the Internet. For example, few of the hundreds of bills we generate each year require a paper invoice, and collections for overseas sales occur electronically.

• Outsource non-core services. A key to any small-business success is to understand your distinctive competence and focus your efforts on that area. This is particularly true for virtual companies. At CAST, we are mostly electrical engineers with superb software-development and support skills. We focus on creating first-class software products and customer-support services for chip designers and rely on outside partners for a substantial percentage of our total labor. This includes services such as payroll, legal, financial, tactical marketing, distribution, and engineering subcontracting.

Check out more of Hal's recommendations here...