How to Start a Business with No Money
Starting a Business with No Money
We all know the benefits of starting a business but taking that initiative is always an uphill task. Who dislikes being an own boss, job security, growth potential, and the financial freedom associated with business? One of the common myths about businesses is that you need enough starting capital. Lack of funds is one of the excuses that most people give. If you have always wanted to start a business but you are scared of financial requirements, here is some helpful information to help you start and run your business.
Before we even go further, you need to have a plan. You will not just wake up and start a business. You need to think about it and strategize. First, you need a well-thought business idea. What is it that you want to start? Will you offer goods or services? How will you offer them? You can also carry out a research to find out what else you need to establish a successful business. Don’t rush the process. Determination is key as you don’t want to give up when you encounter challenges along the way.
Are there Businesses that Started with Nothing?
You are probably wondering whether there are businesses that were started with little or no capital. Yes! You will be surprised that some of popular multinational companies started with a few dollars. A great idea and a strategy will get you far. Below are some of the top brands which were started with almost no money.
- Whole Foods Market. You may think that this business was started with a large financial input but the founders had nothing. Rene Lawson and John Mackey borrowed money from family members and friends to open a store in Texas. Interestingly, they lived in the store because they could not afford the rented apartment.
- Do you know that Apple started in a garage? Other companies that started in a similar manner are Hewlett-Packard, Google, Yankee, Disney, and Harley Davidson.
- Nike Company is yet another inspiring story. The founders of the company sold training shows from a car trunk.
- Dell is one of the biggest companies at the moment. Its founder was a dishwasher. He sold computers from his college room.
These are some of the successful stories. You also can start a business with no money. Let’s go straight into ways of doing it. Below are tips and ideas of getting started.
What can I do for Free?
Mountains of obstacles come your way when you are about to launch your business. Coming up with a list of business ideas and opportunities can be a daunting task. If you are scared by the thought of starting your own business but you do not have money, relax and think about the things that you can’t live without.
What are some of the essentials to your idea? Think about the things that you need such as a custom-designed website. You don’t necessarily need a website if you are starting out. There are millions of people using different social media platforms. Make use of it. Create a Facebook page and start promoting your business. You can as well design several marketing materials on canvas. The other viable idea is trading your resources/skills/products with other people. You can seek payment for what you have or exchange for something else that can be beneficial to your business.
Make use of the internet. There is overwhelming information about business and ideas. Do your research and look for free resources available online. Prepare a list of things need for the business. To be on the safer side, look for free alternatives as well. This may not be a one day activity so be patient. It might take weeks or months but finally you will get it. Saving will also help you in case you will need petty cash.
Get Extra Funds from Friends and Family
Keep in mind that this is not charity work. No one wants to support a wacky idea also. You will need to explain and show confidence in what you plan to do. Have a solid business plan and be prepared to answer all questions directed to you. Those close to you will understand you. Don’t give up because some family members may not support you.
You will have to convince them that your plan will work. Explain everything and ask them for feedback. The feedback you get should be used to improve on different aspects of the plan. When everything is set, ask family members and friends for a loan to start the business. Write everything down because written agreements go a long way in settling disputes. Make it clear when you will repay them. Getting money from a crowd-funding platform is also a great idea.
Do you Need Extra Cash? Apply for a Business Loan
You may start a business and get stuck along the way. You just don’t give up on your business. Look for alternatives to keep going. Maybe you are operating on a limited budget but need for more capital arises. Consider a business loan from a bank. However, be careful with the interest rates and repayment intervals. Ensure that you can comfortably repay without negatively affecting the operations of your business. There are numerous online lenders who also offer small loans to investors who need extra cash. Watch out for their requirements and get that loan.
If you are not interested in large amounts of money, look for a business credit line. These are simply credit cards for businesses. How can they benefit you? You will be able to purchase items every time you need them. This helps to avoid delays and inconveniences.
Local Funding Opportunities and Small Business Grants
Honestly, grants may not be easy to get when you are starting a business. Most people are cautious because they are not sure whether the business will work or not. When your business starts running, you will be surprised by the unlocked opportunities that you get. As the business operates, look for free cash. Keep in mind that there are specific application requirements for grants. In case you meet these requirements, you will have access to a pot of cash. Where do you get grants? Government databases are helpful sources of information. You can as well ask for help from a nearby business administrator.
Woo Potential Investors
Most people thing getting potential investors is a hard task. To some extent, it’s true but it depends with what you present. You also need to get started and demonstrate that the plan can actually work. Some investors are not willing in invest in ideas but already working businesses. If you are lucky enough, a potential investor may decide to support your idea. Investors will help to reduce the financial burden and will help your business to grow faster. When you are working on your business single-handedly, it may take years before it finally establishes. Some investors have more knowledge about the industry so they will guide you accordingly.
Are there any challenges associated with investors? Well, you don’t expect to benefit and not give anything in return. Some will ask for shares which may be more than 50 percent depending on the amount of money they are investing. You have to be careful when signing a contract with investors to ensure that your interests are protected. Ask yourself questions such as. What is my position in the company? What is the role of the investor in my business? Does the investor limit my growth? For how long will the contract run? If you are comfortable with these, you will have good partnership.
Keep Your Job
You already know that businesses can be risky. You need a backup plan or at least keep your job. It is even riskier starting a business when you don’t have money. Do not compromise the financial well-being of your family by risking everything. Although finding motivation to still keep your job when your business is doing well is difficult, you still need to hold on a little bit longer.
Most people make the mistake of resigning their jobs when the business starts to do well. Things may not go well throughout especially when you have to experiment on different things. You may need extra cash to expand the business or to buy more assets. This is where the earnings from your job will help.
Starting a business does not mean that you are ready to give up a steady paycheck. Keeping your job and still running your business will need more time and effort so you need to work harder. As the business grows, your job will help in paying bills. When the business generates revenue consistently, you are free to think about ways of transitioning to full time business.
Look for a Mentor
You need guidance on various things about a business. Build experiences and work on your passion. Do not start a business in an area that is not your comfort zone. Stick to things you know and look for someone you know. This is the best way of building your knowledge and skills. There is nothing wrong with learning new skills but it is time consuming. When you have an area of specialty, you are likely to grow faster. Focus on things that can be done at that moment, not things that will take years.
Acquiring new knowledge and learning new skills requires additional time and expenses. You don’t have money to spend on such things that’s why you need to work with what you have. Paying consultants, getting licenses, and taking courses may be expensive. A mentor will equip you with knowledge. You will also learn new skills by engaging your mentor. This will give you confidence to continue growing your business. Without a mentor, you may make mistakes that might be costly.
If you don’t have money, it means that you are not in a position to employ workers. Learn to get things done by yourself. Hiring people in the early stages of a business is not the best option. It might be exhausting but it is the best alternative for a starting business. You will keep the budget low and you will give your consumers the best products or services. Additionally, you will understand different operations of the business and ways of running them effectively.
The money you save by doing things yourself can be ploughed back to the business. This is how you grow your business. It is tough but with time, you will have enough cash in the reserve to run operations.
The easiest business to start without money is offering services. You will just have to rely on your knowledge and skills. What are your talents and gifts? You can earn from them. Do not be afraid to knock doors selling your services. That’s how you get started and build connections and relationships. You can use the money you earn from selling services to finance that business you always dream about.
You may get a great business idea from the services you offer. Let’s have a look at some businesses that offered different services or products initially.
- 3M- This was initially a mining company. They later started selling sandpaper. Afterwards, they also sold masking tapes.
- Microsoft- Started by offering software development services.
- 37signals- It was initially offering web design services before creating their own products such as Basecamp.
Make your Business Public
If you start a business with little or no money, you have to work hard to inform people about what you offer. Your business should not be a secret at such a stage. Tell people what you do. Call them or advertise on social media platforms such as Facebook. Making your business public gives you motivation to prove to people that you can do it. There is no room for failure when you have already told family members that you are offering a particular service or product. Most importantly, you will land new customers. People around you can be loyal customers if you make a valuable introduction of your business.
You cannot succeed alone in business. You need help from people in different ways. Reach out to other owners of small businesses. Ask them about their experiences and lessons in business. You will be surprised to learn new things because most of them started in a similar way. In case you encounter challenges, ask for advice from reliable and trustworthy people. Below are different ways that asking for help in business will help you.
- You may find new opportunities such as a free office space
- You can find a business partner. With the right co-founder, there are higher chances for success
- You may acquire new skills and knowledge
- You may land new clients or business deals
Join a Master-group
You may join an already existing master-group or create one. Such groups help business owners to save a lot of money. Additionally, you are in a good position to learn from other owners of small businesses. You don’t have to spend extra cash on seeking advice from consultants. Interactions with like-minded people will help you get priceless tips and tricks of succeeding in business.
It is worth noting that some mastermind groups can cost money. Remember that you can start your own without any cost. Look for people who are in a similar position in business. This way, you can share experiences. Building a group with veterans may not be the best idea because they will be discussing totally different things that may not make sense to the level of your business. Start a group with people who have an experience of less than two years in business.
If you are in the same area, it will be better because you can build close relationships. If you are in different cities, you can as well meet through Google Hangout or Skype. Below are top benefits of these groups for those starting a business with without money.
- You can get support or give it to people who have similar ambitions in business. You don’t have to be a lonely entrepreneur
- Group members will make you accountable. This way, you will use funds properly
- You don’t have to learn from experiences. Learning from your own mistakes is expensive and time consuming. Learn from others
- The best thing about master-groups is that your network grows quickly
Avoid Get Rich Quick Schemes
Most of these schemes are not sustainable. There are countless of them both offline and online. You have seen or heard people promising you everything pleasing to your ears. Most of them will promise you richness with no work. You see it as easy money but a hidden trick lies there. Such things do not exist. You need patience, strategy, and to work to make it in business. If you fall for such traps, there is no doubt that you will find yourself hopeless after a few months or weeks. Understand how that business works and dig deep.
As you can see, starting a business without money is not difficult. You just need the right approach and you will be surprised by what you can achieve. Strategize and have a good business plan. This way, you will be prepared for difficult times and you will handle them accordingly.