The explosion of the virtual business model is rapidly gaining awareness. While the image of a virtual company tempts many entrepreneurs, they must also understand it is a model that – like any business model – involves both pros and cons.

When I started Varsity Tutors in 2007, I had no funding and no outside investors – to put it bluntly, I was a broke college student. Any dollar I saved was another dollar to put toward the growth of this company, so I opted for a virtual business model. Varsity Tutors ultimately succeeded, but it did not reach its current state without weathering its fair share of challenges associated with operating a virtual business. In retrospect, I could have avoided many pitfalls had I been able to learn from someone who had already been through it.

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