From the September 2008 issue of Entrepreneur

You probably haven't yet heard of the latest up-and-coming town, Achewood. That's because Ache-wood only exists in a webcomic of the same name. It's part of a growing cadre of webcomics mixing sharp humor and art with a successful business model.

These online comics have developed a large and loyal fan base of young, hip readers. And webcomics creators are learning to mold successful businesses out of counterculture art. Chris Onstad, the creator of Achewood, for example, sells everything on his website from T-shirts to a cookbook with recipes "written" by his cast of characters.

Joey Manley, co-founder of Comicspace LLC, says comics have always been an effective mass market medium, and webcomics have picked up where traditional print comic books and newspaper strips have left off. "Comics are perfect for the web," he says. Webcomic readers don't think of Dilbert or Garfield when they think of comics, he says. "They have a completely different idea of what a comic is, how they interact with the author and what they're looking for in that entertainment package." These audiences allow the artists to build a name brand directly linked to merchandise, which the fans buy to support a medium and artist they love.

Webcomics cultivate an underground rapport with readers that relies on word-of-mouth, so readers discover the comics--and affiliated merchandise--without the traditional online model of SEO tactics and advertising. When it comes to creating merchandise, says Onstad, 33, whose Silicon Valley-based webcomic earns around a quarter of a million dollars in annual sales and was named the No. 1 graphic novel of 2007 on Time.com, "I do what I feel like, and if it's in the Achewood sensibility, chances are it will connect with readers and stick as a product."

Jeffrey Rowland, 34, is profiting not only from his webcomic Overcompensating and its merchandise, but also from the webcomic trend in general. His company, Easthampton, Massachusetts-based TopatoCo, handles merchandising and fulfillment for 19 different webcomics and has sales of more than $1 million.

Manley says the future of webcomics is looking bright as a new generation of readers is discovering a new medium for the art.