For many people, their idea of the "perfect" business is one that would allow them to earn enough money to support themselves and their family and still work from home. Not too many years ago, business opportunities fitting that description were few and far between. Today, however, that is no longer the case.

Technology is making it possible for people to do all kinds of work from remote locations. The biggest contributor to this trend has been the growth and development of the Internet. Over the past decade, the number of small businesses that rely on the Internet for some or all of what they do has skyrocketed.

Needless to say, that has created valuable opportunities for thousands of entrepreneurs, but it has also created some pitfalls. While just about every industry that offers business opportunities to individuals has attracted some less-than-forthright elements from time to time, there are aspects of the Internet that seem to make it more conducive to shady operators.

Whenever you are starting a business--whether it is buying an existing business, starting a company from the ground up or signing on with a business opportunity--it is extremely important to conduct a thorough due diligence process. Certainly, that holds no less true for Internet-based opportunities than for any other kind of business; if anything, it may be even more important.

When evaluating potential Internet business opportunities, there are a number of things for which you should keep an eye out, according to the Federal Trade Commission. While there are hundreds of legitimate business opportunities in this category, an unpleasant experience with one of the "bad apples" could sour you on what just might be one of the most promising fields for new entrepreneurs.

Technology makes it possible to do all kinds of work from remote locations.

Untrustworthy operators have been known to lure would-be entrepreneurs with false promises of big earnings for little effort. That should be an immediate red flag--with any type of business opportunity, not just Internet-based ones. Hard work is the key ingredient in 99.99 percent of all business success stories, and anyone who tells you otherwise bears close watching.

Be especially wary of unsolicited pitches for business opportunities that you receive through emails, telemarketing pitches, direct-mail pieces or pop-up ads on the Web. The proactive role in the search for a new business should be the entrepreneur's, not the other way around.

FTC ADVICE

The experts on Internet business opportunities at the Federal Trade Commission offer several pieces of specific advice when it comes to evaluating these opportunities. They are worth taking a look at.

That document should include the earnings claim, as well as the number and percentage of recent clients who have earned at least as much as the promoter suggested.

If it is a work-at-home or other business opportunity that involves an investment of under $500, you can still ask the promoter to put the earnings information in writing, but there is no legal requirement that the promoter do so.

The franchise disclosure document contains information about the company, including whether it has faced any lawsuits from purchasers or lawsuits alleging fraud.

Look for a statement about previous purchasers. If the document says there have been no previous purchasers, but the seller offers you a list of references, be careful. The references could be phonies.

Promises of big earnings with little effort should be a red flag for any business.

The FTC requires most business opportunity promoters to give potential purchasers the names, addresses and phone numbers of at least 10 previous purchasers who live the closest to the potential purchaser. Interviewing them helps reduce the risk of being misled by phony references.

While a complaint record may indicate questionable business practices, a lack of complaints does not necessarily mean that the promoter and the business opportunity have not had problems. Unscrupulous dealers often change names and locations to hide a history of complaints, according to the FTC.

Entering into a business opportunity agreement can be costly, so it is best to have an expert check out the contract first. If the promoter requires a deposit, ask your attorney to establish an escrow account where the deposit can be maintained by a third party until you finalize the deal.

THE GOOD STUFF

As was pointed out earlier, the FTC'S advice on protecting yourself when considering the purchase of a business opportunity applies to any type of business opportunity, not just those associated with the Internet.

The Internet has a lot to offer budding entrepreneurs, especially those who are willing to work hard, use their imaginations and grow their businesses. The Internet is particularly well-suited for a variety of business functions, many of which can be used to start a new business, expand an existing one or create new opportunities in other areas.

For those in the business of selling products or interested in starting such a business, the Internet offers a greater level of control and potentially greater profits than a traditional means of distribution, such as through a brick-and-mortar store.

By selling directly to the end-user via an e-commerce site on the Internet, you can eliminate the middleman. This strategy also gives you the opportunity to experiment easily with different pricing structures. You can try out different prices until you find the one that maximizes your profit and volume levels.

The Internet is a great way to start a joint venture with one or more other entrepreneurs who share your business interests. The 24/7 connectivity provided by the Internet makes it easy to collaborate with other business owners, regardless of their physical location. That greatly expands your universe of potential joint venture partners.

The Internet offers sellers a greater level of control and potentially greater profits.

Even if you already have an existing conventional business located in a store or an office, you can use the Internet to increase its exposure and expand your market.

If your current business is in the retail sector, it's a simple matter to begin offering selected items from your store for sale via a Web site. Start with your best-selling items and adjust your merchandise mix based on performance. You may find that different items do better or worse in different parts of the country--or the world.

For those operating a service business, the Internet can provide a valuable means of additional promotion for the services you offer. You can also use it to make your business run more efficiently with strategies such as allowing your customers to book appointments through your Web site. By selling ad space on your site to other businesses, you can even use the Internet to develop new revenue streams.

If you do decide to start a business that relies totally or partially on the Internet, you will be part of what is arguably the most important economic force to emerge so far in the 21st century

According to the U.S. Small Business Administration (SBA), small firms represent more than 99 percent of all employers and account for more than half of all private sector employees. Increasingly, "The use of computers and the Internet has become the norm among small businesses and the self-employed," said SBA economist Victoria Williams.

The spread of computers and the Internet makes self-employment more attractive.

In a recent report on self-employment and computer usage, the SBA concluded that self-employment is important to the well-being of the nation's economy. It boosts the economy by creating jobs, while bringing unique products and services to market--often via the Internet.

"The spread of computer and information technology usage among the U.S. population and businesses since 1990 has been remarkable," Williams said. "This trend has helped make self-employment more attractive, as technology has lowered startup costs in some industries, and the Internet has enabled connections and communications that were the stuff of science fiction only a decade ago.

"The most recent reliable data on these developments date only to 2000, but there is no doubt that the trends it reveals have only intensified since then.

SBA's FINDINGS:

SMALL BIZ ENGINE

In 2002, there were almost 23 million small businesses in the United States, according to estimates by the SBA's Office of Advocacy. Such businesses pay 44.5 percent of the total U.S. private payroll and generate 60 to 80 percent of net new jobs every year.

There is also evidence that small businesses are more creative and innovative than their larger counterparts. Small businesses produce 13 to 14 times more patents per employee than large firms, and those patents are more than twice as likely as large-firm patents to be among the 1 percent most cited.

More than half--53 percent--of small businesses are home-based, and 3 percent are franchises. Small businesses made up 89 percent of all identified exporters and produced 20 percent of the known export value in fiscal year 2001, according to the SBA.

Small business ownership offers an equal-opportunity shot at success for anyone willing to work for it, whether through an Internet-related business opportunity or some other type of venture.

The message is clear: Small business ownership can be the path to economic and personal independence for those willing to take the plunge, regardless of race, creed, sex or color.