New to Sharepoint and cant seem to add external users to my site!!

[AndreaG729]

So i have read some of the similar questions but I did not see any responses that seem to fit what I'm having trouble with. 
I Created a Team Site (I wanted to share some documents with out a lot of chatter) and I need to be able to add people from outside the company to be able to get a password and be able to sign in and download some of the documents. 

I thought i had the permissions correct but it keeps telling me that I cant add someone as a member as seen below.

How I have been trying to add members:

Site permissions 

Invite people 

add members to group

Add members

enter the email (since they are in my outlook I click the person) click save 

and get that message 

Below are my share setting....... Im super new at this... did I do something wrong? Please help!

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[#2]

Per the message below your error in the top screenshot, in order to add a Guest to the Group, you need to do that through Outlook (or Teams) and not the SharePoint Online interface.

The alternative is just sharing the site which you can do through the gear icon -> Site Permissions -> Invite member -> Share site only.

[#3]

I did go through outlook and it would not send anything or let me select anyone.... If I share site only will they be able to download and upload documents?

[#4 · Accepted solution]

Yes, they will be able to access content on the SharePoint Online site.

Note that there may be other restrictions in the M365 Admin center and/or Azure AD preventing you from adding users to Groups.

[#5]

did you end up getting to the bottom of this ? I am having a similar issue.