In this century, everyone wants to start a business. People young and old complain that they want to start a business
but have no money. If you have a viable business idea don’t let the lack of
capital stop you. Did you know that you can start your company today for $0? Don't
worry - in this article, we will learn how to start a business with no money.
You might be asking “What type of
business can I start with no money?”
Here are some brands that started
with almost nothing:
Whole Foods Market – In 1978 John
Mackey and Rene Lawson saved and borrowed money from friends and family to open
their first store in Austin, Texas. After getting evicted from their apartment,
the two lived in their first store.
Apple, Disney, Google, Harley
Davidson, Hewlett-Packard, Lotus Cars, Mattel, Yankee Candle Company all
started in garages.
Nike – Founders, Philip Knight
and Bill Bowerman started selling training shoes from their car trunk.
Dell – Michael Dell started out
as a dishwasher, making a whopping $2.30 per hour. Dell started selling PC out
of his college dorm.
Throughout this long article, I will be teaching you how
to overcome each business stage without a penny while sharing my personal
experience doing it, share some ideas that you can start without much money,
particularly of online businesses, and recommend you some tips and
considerations you may want to take throughout the process.
What motivated me to write this post was recently
receiving a message in the chatbot down in the corner that said: “I want to
start a small business but have no money”.
However, this is quite a controversial and difficult topic
to talk about. In the end, starting a business can cost from $0 to millions of
dollars, as it depends 100% on the industry you want to operate in, the idea
you have had, your knowledge and experience in the field, etc.
How to start a business with no
money?
1.
Work on Your Business
Idea
Coming up with a great business idea is just the beginning
of your journey as an entrepreneur. There are many more steps that you need to
take before you can get started. Fleshing out your business idea is one of
them, and it’s very critical to the success of your venture.
Is your business idea really unique? What value will it
generate? Is it something your target audience really wants? Or is it something
you think they’d want? Getting answers to these questions is important to
determine whether or not your idea works.
2.
You MUST Research!
The first and possibly most important step of starting a
business is to research different markets & customers.
You have a brilliant idea that you know will definitely
work, but what about your competition? Will it be difficult for a rival to copy
your idea and repackage it in a better way? A potential investor will ask you
this when you approach them for funding. It’s very important to understand the
market you operate in and your competition.
You should first look at the trends and identify
challenges that your business may face. The next step is to understand how you
are going to address those challenges to stay profitable.
3.
Keep Your Present Job
Being practical is extremely important when you are toying
with the idea of starting a business. Starting a business is
risky. Starting a business with no money is even riskier. Don’t jeopardize your
family’s financial well-being. The longer you keep your job the less pressure
you put on yourself. When you start your business you are not ready to walk
away from a steady paycheck. It’s true that you’ll have to work harder, But
the transition from being an employee to a business owner will be far smoother
as you won’t have additional expenses to worry about.Once
your business starts to generate revenue, you can start thinking about
transitioning out of your job.
4.
Start a Home-Based
Business
Whenever you need to start your business either online or
offline, you need to begin with a home-based office. By opting this method, you
can eliminate a roughly 42% of the established businesses’ overhead costs. Know
how your home-based business, you can eliminate or significantly reduced the
below-mentioned things all together.
Start Considering Your Vital Savings:
· First and the foremost you don’t have to pay office lease
payments
· Second you don’t have to deposit any cash to take the
franchise or to set up services for the franchise.
· Third you are saving the fuel costs required for commuting
to work
· Reduction in your child care expenses that you might have
to take upon if you are out of the home.
· According to the significant facts, most of the companies
could add more than a Billion to their bottom line profits if they start
offering their employees to work from their home. Thus, working from home or
having a home-based office is the smartest option for setting up your business
with inadequate resources.
5.
Master your mind.
The mind is split into two: the conscious and the
subconscious. The subconscious is what really matters, what produces the
results, but it cannot tell right from wrong. The conscious on the other hand
can, thus the conflict. The conscious mind exists just to act as a gatekeeper
for the subconscious. Obviously you don't want the wrong things to make it
through. Duality (right-wrong, good-bad, big-small, easy- hard) exists only in
the conscious mind. During your "formation years" you got by default
a lot of beliefs from the people around you (family, friends, teachers,
colleagues, media etc).
6.
Dream big and have a
vision.
White down the why behind your goal. This should be
meaningful to you. Try with more things until you hit a home run. You need to
get inspired by your goal. Your goal should be a mission to serve, to make a
difference. Otherwise you are not going to take action. It's just going to be
wishful thinking. This is the process that will inspire you to take action. It
will come naturally as an idea or an urge to do something towards your goal.
7.
Think creatively.
The industrial revolution created "robotic
mindsets" focus mainly on fulfilling pointless and repetitive tasks. A
direct effect of that was a generalized creative thought atrophy:
8. Stick with something you know.
Build on your passions and
experiences. Instead of trying to start a business in a niche outside of your
comfort zone stick to something you know. Build your business on your skills
and knowledge. It is true that you can learn new skills, but it will take time.
If you want to start a business quickly, you have to focus on what you can do
now not years from now. Always believe in the
saying, get the job you love, and you never have to work for a day. So find out
the expert in you and start the business.
Also, having that knowledge is sometimes all that is
needed to successfully take the plunge into entrepreneurship.
9. Do all the work yourself.
Get ready to hustle. Hard work is an absolute necessity,
but when you are starting a business with little to no capital then you must be
prepared to dedicate everything you have into making the business a success.
This might mean cold calling, handling customer support, dealing with billing
and accounting, and every other working part of your business. Doing everything yourself you will be able to put every dollar
back into your business. You will wear many hats and it will require the
majority of your time and energy if you are to make it.
10.
Avoid unnecessary expenses.
You are going to have plenty of expenses, and there are
some that just can’t be avoided. What you can avoid though is overspending.
Take something as simple as business cards. You could drop $1,000 on 500 metal
business cards that give off the “cool” factor, or you could spend $10 on 500
traditional business cards. Being frugal in the beginning can be the difference
between success and a failed business.
11.
Don’t get buried in
credit card debt.
There is a smart way and a suicidal way to use credit when
starting a business. New computers, office furniture, phones and supplies can
all quickly add up. Instead of purchasing everything at once and throwing it
all on a credit card, use your company’s revenue to finance your expenses.
Eliminating the stress and burden of debt will greatly increase the chances of
creating a successful business. that burn through millions of dollars only to
fizzle out and shut their doors forever.
12. Offer a service.
Some of the best business you can
start with no money is a service business. You can start a service business
with practically no money. Instead of money what you need is the ability to
knock on doors and make sales. Even if you ultimately want a product business,
owning a service business can help you get there. Use the service business to
finance your dream business.
Here are some great product
businesses that started out selling something else:
3M – Started as a mining company.
From that, they went on to sell sandpaper, then masking tape, the “Scotch
Tape”.
Microsoft – Started out by doing
sporadic software development gigs.
37signals – Started out as web
designers before they have created products like Basecamp.
13. Create a professional website.
If you’re offering any type of
business service, a digital presence will help you get more clients and add to
your professionalism. Websites can be setup for with little skill and cost,
there are thousands of professional website templates online for free that can
help get your business website up within a few hours. It’s essential you use a
professional domain name for your business website, such as the name of your
business or your own name. If you’re stuck coming up with a domain name, try
using a domain name generator to help develop some ideas and register the
domain.
14. Make it public.
Starting a business with no money
means that you have to work hard to get the word out. Don’t keep your business
a secret. Tell as many people as you can. Call your friends. Explain it to your
family members. Make it public. Telling people will help you in several ways.
For starters, it will give you extra energy. More importantly, it might help
you land some of your first customers. People in your network could make
valuable introductions.
15.
Run a Trial
Want to be sure if your business idea is indeed unique?
Run a test and find out. A pilot will give you the confidence you need to take
your idea to the next level and mitigate risk. You can start on a small scale
by giving away some freebies to a few people in your target audience group to
see how they respond.
A small trial can give you some new insights to grow your
business and identify challenges that you might have overlooked.
16.
Gather Feedback
If you are planning to get into a completely new business,
it would really help if you got a second opinion from someone who knows the
market and the challenges involved.
A business idea that looks good on paper may not be that
attractive when you actually get into it. An expert’s opinion may help you look
at things from a different perspective and gain more knowledge that you may
lack.
17. Ask for help.
You might be thinking “I want to
start my own business with no money, but I don’t know what to do.” Nobody can
succeed alone. Especially, if you are starting a business with no money you
will need all the help you can get. Reach out to small business owners. Many of
them started their business with little or no money.
Asking for help can help you several
ways:
· Some people in your network might
be entrepreneurs who could give you some pointers about starting a business
with no money.
· You could find a co-founder.
Starting a business with the right co-founder greatly increases your chance for
success.
· A friend, family member, or
coworker could teach you skills you don’t have.
· You might find free office space.
18. Barter.
When you start a business with no
money, bartering comes in handy. Barter your own skills for office space,
products, equipment, or services you need but can’t afford. Bartering is also a
great networking tool.
19. Join a mastermind group.
Joining or starting a mastermind
group can help you save a lot of money in the long run. It gives you an
opportunity to learn from other entrepreneurs. Instead of paying an expert or a
consultant for advice you will interact and learn from other entrepreneurs.
Although many mastermind groups
cost money you can start your own for free. Look for people who are at a
similar stage in business. If you are starting out, you don’t want to build a
mastermind group of business veterans. When you are starting outreach out to
people who are also interested in starting a business and those who have been
in business for less than two years. With that strategy, you will have enough
diversity in the group to make it interesting for everyone.
It helps if you are in the same
city, but you can build virtual mastermind groups and meet through Skype or
Google Hangout.
Here are some of the greatest
benefits of mastermind groups:
· You give and get support from
people with similar goals and ambitions. Being an entrepreneur can be a lonely
place. Get the support of others.
· Learn from those who had some of
the same or similar business challenges to yours.
· You can get different perspectives.
· When you are part of a mastermind
group your network grows exponentially. The group’s network becomes your
network.
· You can ask for help with
problems you haven’t faced before.
· Your fellow members can keep you
accountable.
20. Invent something and license it.
If you are an inventor, you could
license your patent to a company. In licensing deals you normally get a
percentage of sales. The best way to license your invention is to seek out
manufacturers. Technically, it is called licensing your patent rights.
You want to start out by
developing a list of manufacturers. Look for those that are already making
products in your target niche. One or two manufacturers is not enough. Identify
at least, 25 potential manufacturers.
You can find manufacturers by
looking at product packaging, online research, networking, and visiting trade
shows. Libraries have excellent resources to locate manufacturers. Thomasnet,
WikiMachine, ManufacturerUSA are possible resources too.
Reach out to manufacturers with a
short message about your invention. Provide enough information to trigger
interest, but don’t overwhelm people with data. LinkedIn can be an excellent
resource to find the appropriate contact person.
Consult with an experienced
licensing attorney before you enter negotiations. Ultimately, the licensing
agreement will include details about upfront payments, exclusivity clauses,
percentages, and infringement issues. You could really do yourself a major
disservice by entering into an agreement without professional help.
21. Partner with an entrepreneur.
Many businesses are started by
solopreneurs who quickly become overwhelmed. Most entrepreneurs would want you
to buy yourself into a business partnership, but there are still ways for you
to do this with little or no money.
You could find a business where
the owner is about to retire. The owner of the business might want to sell the
business, but the reality is that most businesses never sell.
The most common reasons
businesses don’t sell are that they are:
· Priced unrealistically high.
· In a downward spiral by the time
they are listed for sale, and potential buyers look at the business like a
falling knife.
· Relying too much on the business
owner. Potential buyers fear that the business will not survive once the current
owner leaves.
· Another option is to find a
business where the entrepreneur is either too overwhelmed or simply burned out
with the business.
22. Find a co-founder with money.
Many successful businesses are
started by two or more founders. With two founders you will also improve your
chance of success.
Tell people in your network that
you are looking for a co-founder. Team up with someone you trust. It’s a bit
like getting married.
You can search for potential
cofounders through:
· Friends, family, and family
friends.
· You classmates from college and
high school.
· Past coworkers.
· Local startup networking events.
· Business meetups.
· Former business partners if you
have been in business before.
· Working in a co-working place.
· Teaming up with a customer.
23.
Focus on cash flow,
not profitability
The reality is that you pay bills with cash, so focus on
cash flow. If you know you are going to bootstrap, you should start a business
with a small up-front capital requirement, short sales cycles, short payment
terms, and recurring revenue. It means passing up the big sale that take twelve
months to close, deliver, and collect.
24. Get paid fast or upfront.
When you start a business with
little or no money, getting paid fast is crucial. Nothing will help your cash
flow more than getting paid up front. Late payment, net 30, 60, or 90, slow
payment will hurt your business.
You can get paid fast several
ways:
· Ask for at least 50% payment
upfront.
· Offer incentives to pay early.
· Show up in person, if your
clients are local.
· Send invoices at least once a
week.
· Ask your customers to pay with a
credit card or electronic bank transfer.
· Fire customers who are chronic
late payers.
· Set up automatic payment.
25.
Assess Your Capital
Needs
You require money to start your business, but how much do
you really need? Without a clear idea you run the risk of coming up with an
unrealistic valuation of your business, which will put off investors and get
your loan application rejected.
So before you start wondering how you should raise money,
you should focus on evaluating your funding requirements. How much do you need
to get started? How exactly are you going to use the funds?
Another thing that’s important to understand, when doing
this analysis of how much does it cost to start a business, are the different
types of costs that exist. We will divide them into three categories:
Fixed vs. variable costs: Rent, employee’s wages, and
insurances are 3 examples of fixed costs, those that you’ll have to pay even if
your business’s doors are closed. Materials, transaction fees, and bonuses are
variables costs, those that depend on how many goods and services your business
produces every month. As the business grows, fixed costs begin to represent a
smaller part of the business’s revenues, while variable costs increase.
One-time vs. ongoing costs: One-time payments can be
significant at the beginning as you’ll need to form the business, acquire
machinery, prepare the working space. Ongoing costs are those that need to be
paid on a regular basis - they generally increase as time goes on.
Essential vs. optional costs: Essential costs are
absolutely necessary for the survival, growth, and development of the company.
Optional purchases, in contrast, are those made only if there’s a surplus of
revenues. They generally involve experiments and risky decisions that may not
bring any ROI (return on the investment).
Knowing these kinds of costs will be essential at the
moment of doing an estimate of how much will starting your business cost.
The internet has democratized a lot the business world,
reducing the costs of starting a business to $0 or almost $0. Someone who can
code can easily purchase a domain and hosting for less than $30 and build a
site that makes thousands per month.
A great example of this is Alex Tew who, at his 21 years,
built a digital billboard that sold 1 pixel for $1. It contained one million
pixels and selling them all only took him 4 months, at probably $0 costs.
26. Get a credit line.
Businesses are commonly funded by
lines of credit. You might end up using a credit card to help you with your
cash flow. The key with credit lines is it is no substitute for revenue. Use
credit lines only as a temporary measure, not as an alternative to making
enough money to pay your bills.
27. Use crowdfunding.
At a time when 98% of the
business plans are rejected by VCs and accredited investors, crowdfunding offers
a great alternative for entrepreneurs. Crowdfunding requires a lot of effort
and dedication, but is a great option, especially for consumer product
businesses. The great thing about crowdfunding is that it gives you access to
capital without giving up equity.
Crowdfunding can help your
business in several ways:
· It’s free!
· Crowdfunding reduces your
financial risk.
· Fast access to capital.
· It enables you to pre-sell.
· Crowdfunding is easier than
getting VC or angel investment.
· It gives proof of concept. If you
don’t get funded, perhaps your idea isn’t as great as you thought it is.
· Your crowdfunding campaign can
serve a marketing tool.
· Your investors can help you
improve your product.
· The “crowd” can provide great
word of mouth marketing.
· It can build a loyal following.
· It’s free PR.
The most popular crowdfunding
sites are:
· Kickstarter
· Indiegogo
· RocketHub
· FundRazr
· GoGetFunding
28. Explore Crowdfunding Platforms
Crowdfunding platforms such as
Kickstarter have changed the way entrepreneurs are raising money to fund their
new businesses. Whether you want to sell a new software tool or set up an
organic noodle bar, you can get people to invest in your business.
29. Network with People
When you don’t have money to
start your business, it’s essential you find the right people who can help. You
may attend events and trade shows where you can find potential investors. You
may also join various online forums on social networking sites where you can
find useful tips and resources to bring your business to life.
Most venture capitalists and
investors are quite active on social media, so if you can wow them with your
idea you may find a great way to get started on your business dream.
30. Apply for government programs.
Apply to the Small Business
Administration (SBA) and other government agencies for help and funding. There
are business financing options for women, veterans, and minorities.
Enter business plan competitions.
31.
Take advantage of
free advertising and marketing.
There are several ways to generate a buzz for your
business without breaking the bank. Social media is a great way to gain
exposure and interact with potential customers. You can also reach out to local
media and offer your expertise.
Make as many local media contacts as you can and be
extremely responsive with their requests. This can lead to them to branding you
as the local authority, generating plenty of free press for your business.
Here are some of the most common
free advertising options:
· Submit guest blog posts to
relevant blogs. You will get a free link back to your own site.
· Order free business cards from
Vistaprint – Most importantly pass them out.
· Develop strategic partnerships
with businesses who serve the same customers you are targeting. It will enable
you to cross-promote each other’s business.
· Set up a free WordPress website.
· Submit your business to Google
Local.
· List your company in free
directories related to your niche.
· Offer an introductory free
consultation or free evaluation.
· Host an event. Recruit sponsors
to cover your costs.
· Create a Facebook Fan Page.
· Frequent forums where your
customers hang out.
· Network with others and get free
word of mouth marketing.
· Ask friends, family, and people
in your network for referrals.
· Make connections and promote your
business through social networks like Facebook, Twitter, LinkedIn, Pinterest,
and the like.
· Build your email list from day
one. Email is still one of the most effective marketing channels.
· Include your website, Facebook
page, and Twitter handle in your email signature.
· Write an eBook or a report and
use it a promotional gift item.
· Comment on blogs with a link back
to your own website.
· Learn about Search Engine
Optimization (SEO) and use it to drive free traffic to your site.
· Develop an iPhone or Android app
for free and include your branding within it.
· Post an ad on Craigslist.
· Write articles relevant to your
niche and distribute them to article directories.
· Publish press releases. Prlog
offers free press release distribution.
· Wear your ad. Print your brand,
URL, and phone number on your T-shirt, so when you are out in public people
will see.
The above list might seem
overwhelming at first, but it is doable. Take it one step at a time. Be
systematic. Track and measure your results. Rinse and repeat the ones that give
you the best results.
32. Avoid get rich quick schemes.
There are countless cases of “get
rich quick schemes” both online and offline. They promise you everything you
want to hear. Quick and easy money with little or no work. It simply doesn’t
exist. You can start a business with no money, but you can’t start one without
hard work, strategic thinking, and patience.
Don’t believe stories about
overnight success. They are simply myths.
Here are examples of real success
stories, and none of them is the overnight kind:
Milton Hershey started 3
unsuccessful candy companies before he started the Hershey Company.
It took Bill Gates 6 years to
land his first contract with IBM.
It took Steve Jobs 20 years to
become an overnight billionaire.
It took Biz Stone 8 years to come
up with the idea for Twitter.
It took Steve Martin and Jim
Carrey 10 years of stand-up gigs before making it big.
Nothing will hurt your chances
for success more than believing in the – false – idea of overnight success. You
are doing yourself a disservice believing it. Most businesses take years of
development before they become successful. You can start a business with no
money. Expect to spend years to build your business instead of days.
Persistence is key.
NOTE: This is not gonna be a cake walk but it's possible
with Understanding, Confidence and Patience (as it might take 3–5 years to
become a well established business)
This was just one way to make you stand apart from the
crowd but there are thousands of ways for those who dare to desire.
All the best
If your idea and plan of execution aren’t well thought out
from the beginning, no amount of money can turn it into a winner. Have a great
idea but very little money? Don’t let that stop you! Yes, there will be
ridiculously long days with little to no sleep. Yes, you are going to be
stressed. But those that want it bad enough will make it.
Don’t let limited capital prevent you from taking a great
idea and running with it. Will it be difficult and will you have some stressful
situations? Of course, but that is part of entrepreneurship.
Time is more important and precious than money for
investing in starting a business. Time is money my dear. First invest your time
in generating a promising and successful business idea.
Always remember the tips mentioned above as they will help you in keeping your business on track.
Related post:
https://jiyoaurjeenedoo.blogspot.com/2020/11/how-i-do-business-myself-without-money.html
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