Nike founders Philip Knight and Bill Bowerman started their business selling sneakers on the nut of their car.
Michael Dell started out washing dishes for what he earned $ 2.30 an hour. And he started selling personal computers from his college dorm.
All of these companies: Apple, Disney, Google, Harley Davidson, Hewlett-Packard, Lotus Cars, Mattel, Yankee Candle Company all got their start in small garages.
Don’t have money to start your business?
Thinking that you need to have a lot of capital to start a business can be a deception. In fact, you can sometimes start with little or no financing.
As you read it, starting a business with no money may seem like a crazy idea, but it is not impossible.
While it is true that to start and scale any business, you will need more than just a little cash. You will most certainly need partners, investors and a solid plan for how you will use your new business funds to grow.
However, when you are starting out, you can start small. Even better: you can start as “small” as you like.
For example, if your plan is to open a store where you sell your handmade products, you can always start by selling them to friends and family. You can build a reputation and get initial feedback.
You can then sell them online on a third-party website. After that, you can move on to hosting your own site and setting up a store. Do you get the idea?
You can start as “small” as you want
If you’re concerned about how you can start a business with zero funds, here are some ideas on how to do it:
Ask yourself what you could do or get for free
Making a list of obstacles that get in the way of launching your business is very easy. Often what is difficult is making a list of opportunities that are in front of you.
If the thought of starting a business with no money scares you, stop and reflect on what you are doing without those resources right now.
What is essential for your business? Need the sleek, personalized website when you’ve just perfected three items for your new store? Could you create a free Facebook page to promote your business locally?
Or would it make more sense to list your products for sale on a third party site? Would it make more sense to design your own marketing materials in Canva? Maybe you could negotiate and exchange skills / products / and resources with other people instead of payment?
To say that there are many free resources on the web falls short. Make a list of what you need for your business, and then search the web for free alternatives. It may take some time, and maybe even require you to acquire some additional digital skills, but it will save you funds when you need them most.
Accumulate six months of savings for expenses
It is true that using your savings account is not the ideal situation. However, it is a fairly common practice among entrepreneurs.
When designing your business plan, be honest with yourself about how much you are spending and how much income you are likely to make. Next, be realistic about how long it will take before you see a profit.
Typically, it takes no less than six months before you begin to receive the cash inflow. Set a goal of saving at least six months of living expenses so you can dedicate yourself to your new business.
Ask your friends and family for support with extra funds
Remember, you are not asking for charity. You are not asking your friends and family to support your crazy business idea. No, you dream of a business and your business plan is solid.
You have crossed your t and dotted the i’s. That is why you are looking for the people closest to you when you launch. Use your friends and family as a multi-layered resource.
Practice your sales pitch with them. Ask for feedback. And, when you’re ready to start your business, ask if they can help you with a small loan to jump-start the business.
Just make sure you have everything in writing and indicate when you will return them. You can even use a crowdfunding platform to encourage the people around you to encourage their networks to participate.
Explore crowdfunding platforms
Crowdfunding platforms like Kickstarter have changed the way entrepreneurs are raising money to finance 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.
Apply for a small business loan when you need extra cash
If you are looking for more capital and have been operating on a tight budget, consider applying for a small business loan. Banks and online lenders offer different types of small business loans to clients looking for additional cash flow or mutual funds.
You can usually get more favorable terms with a traditional bank. However, online lenders are often more lenient in their requirements. Just be careful with those high interest rates.
If you are not looking for a lump sum loan amount, consider a business line of credit. In short, they are like credit cards for your business. They are good options for purchasing items as needed.
Find small business grants and local funding opportunities
In fact, small business grants are not always the easiest to find or obtain. But, once you have your business up and running (no matter how small it is), you can start seriously looking for free money.
Always remember that grants will generally have specific application requirements. As long as you get to know them, you’ll be competing for a pot of cash that is all yours. Begin your search of government databases and always be sure to ask local small business chapters for help.
Contact and meet potential angel investors
You’ve probably heard of angel investors. They come into play when it’s time to scale your business beyond just being yourself and the group of loved ones who have contributed. Angel investors are generally among the first people outside the company to seriously invest in a business.
Unlike outside companies or other venture capitalists, angel investors deposit their own personal funds. They can also be the best type of mentor, as many of them are former / current entrepreneurs.
See also: 12 Best Kept Secrets of Successful Entrepreneurs
Assess your capital needs
You need money to start your business, but how much do you really need? Without a clear idea, you run the risk of arriving at an unrealistic valuation of your business, which will discourage investors and reject your loan application.
So before you start wondering how to raise money, you should focus on evaluating your funding requirements. How much do you need to start? How exactly are you going to use the funds?
Without a clear idea, you run the risk of arriving at an unrealistic valuation of your business.
Networks of people
When you don’t have the money to start your business, it is essential that you find the right people who can help you. You can attend events and trade shows where you can find potential investors. You can also join various online forums on social networking sites where you can find helpful tips and resources to bring your business to life.
Most venture capitalists and investors are quite active on social media, so if you can surprise them with your idea, you can find a great way to start your entrepreneurial dream.
Apply for a government small business loan
There are several loan programs designed to help first-time entrepreneurs establish their business. To qualify for the loan, your business must meet some criteria, such as operating for profit, and it must have a good credit score.
With that said, here are other tips to get your business done:
Keep your current job
Being practical is extremely important when you are toying with the idea of starting a business. You need a steady source of income before you can establish your business, so it is wise to keep your current job. By retaining your current job, you will be more secure when you need to take risks.
Of course, you will need to spend extra hours and work harder. But the transition from being an employee to a business owner will be much easier since you won’t have to worry about additional expenses.
Work on your business idea
Having a great business idea is just the beginning of your journey as an entrepreneur. There are many more steps you need to take before starting. Developing your business idea is one of them, and it is very important for the success of your company.
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 would want? Getting answers to these questions is important in determining whether or not your idea will work.
Analyze your market and its challenges
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 to request financial support. It is very important to understand the market in which you operate and your competition.
You must first look at trends and identify the challenges that your company may face. The next step is understanding how you will address those challenges to stay profitable.
Run a test or prototype
Do you want to be sure if your business idea is really unique? Take a quiz and find out. A pilot test will give you the confidence you need to take your idea to the next level and mitigate risk. You can start small by gifting some gifts to some people in your target group to see how they respond.
A little quiz can give you new ideas to grow your business and identify challenges that you might have missed.
If you are planning to go into a completely new business, it would be really helpful 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 as attractive when you actually get involved. Expert opinion can help you see things from a different perspective and gain more insight than you may lack.
As you can see, the issue of money can be less critical at the beginning if you do things right and follow the steps recommended in this post. Dreaming big is just as important as starting small.
Shaping the idea and doing it gradually can be the best guarantee for an investor to set their eyes on your proposal. Leveraging on the infinity of resources that the Internet offers you is something that a few years ago many people did not have, so you are in a very good time.
Go ahead and start the most exciting adventure of your life today: undertake.