Starting a business requires money but if you have just little or no money, you can get creative with whatever you have and still start your own business.
When It Comes to Starting a Business, Some Other things Are More Important
As entrepreneurs, we tend to over-rate money when it comes to opening a business but from my research, there are some other things that are more important, like mental capital, social capital and the time and energy you’re willing to put in.
Mental Capital: This refers to your business idea. Is it a sound and workable idea? If it’s not, having a lot of money to start-up would not help matters. So, instead of obsessing over your lack of money, why don’t you take a second look at your business idea?
Social Capital: The axiom, ‘show me your friend and I’ll show you who you are’ rings true here. The power of your social network in realizing your business dreams cannot be over - emphasized. Are you linked to people who can help you realize your business dreams? Check your network again and start socializing with people who can lift you up and help power your dreams.
Time and Energy: How much time and energy are you willing to put into your business. You can have all the money in the world to start a business but if you don’t put your energy and time into it, such a business would not grow. So, I think the time and energy you’re willing to put into the business is more important than money.
And I can tell you from experience that many businesses started with a lot of money and less of mental capital; social capital as well as time and energy end up failing, because money is not everything. So, if you’re an entrepreneur, hoping to launch out and money seems not be enough, engage your senses, get creative and you’ll come up with ways to get around your seeming disability.
Below, I share some tips that I think can help you jumpstart a business with little or no money.
How to Launch Your Own Business with Little or No Money
* Start with a sale. If you have a good reputation, you can ask a potential client to make an order before you even launch out. Such funds can be channeled towards starting the business. When I started my small publishing business, my focus was just on getting sales. If you do this, you’d put the business on a solid footing.
Mark McCormack started world leading sports management business (International Management Group - IMG) with $500, his law degree and Arnold Palmer as his first client. Today, that business is dubbed “powerful at sports management and marketing that it could promote its roster of stars in ways unimagined by other agencies,” by Business Week. And nine years after the death of the founder, the business is still trudging on.
* Outsource: If you’re going to start a business that involves heavy machinery, it’s best to outsource your manufacturing or production needs. Most companies that have these machines realize they’re under-utilized and won’t mind charging you a fee to produce your product for you, so you don’t have to look for money to get the machineries upfront. It’s a cheap way to get into production or manufacturing. Also, you can outsource your staffing needs. If you realize you need a staff but can’t commit to staffing contracts and legalities, you can outsource your staffing needs and probably pay per hour with no contractual obligations.
* Use Other Peoples’ Money and Talent: Another smart way to start-up your business without money is to use other peoples’ money (OPM) and talent (OPT). There are people around you who have the money you need to start-up; all you need do is to ask. Also, there are people around you who’re talented in areas like sales, correspondence, legal, etc. Ask them for help. They could even be family. Just make use of the three-letter word: a-s-k. You’d be surprised at the amount of help you could get this way.
* Bootstrap your start-up: Self help, they say, is the best form of help and that essentially is what bootstrapping is all about. According to John B. Vinturella, “bootstrapping means reinvesting cash flow to grow your business. Re-invested earnings are the heart and soul of most successful businesses. Imposed frugality during the start-up years often creates a financial discipline, which keeps the company strong into the future. And, due to the power of compounding, even a very small venture can grow very substantial over time.”
* Start on a part - time basis: You can also start on a part-time basis while keeping your day job. This way, you enjoy the best of both worlds, as you start working on your business dreams and get little funding from your day job. This means, you’ll work on your business at night, while your day job takes centre stage in the afternoons.
* Start Small: Many entrepreneurs think of starting business in a big way: exotic office settings, official car, four telephone lines, and all the works. But the financial implications of such can kill a beginning business. I’m not saying you should not dream big. By all means, dream big, but start small. Be realistic here, while keeping your dreams in view.
* Sell, sell and sell: Every business needs sales but for a business starting with little money, the importance of making sales cannot be over - emphasized. Sales should be paramount in your business plans and projections. It’s an understatement to say you should be obsessed with sales. “How am I going to sell more of these products and services?” That should occupy your every waking moment.
* Start from Home: You can also decide to start from home if you’re running on a strict budget. This won’t cost you a dime and you can also make use of the technological devices you already have like the P.C, old truck for deliveries, one-year-old phone, etc, without having to spend on getting top of the line equipment.
* Get Operational quickly: Instead of fussing and over - analyzing your business idea, I think you should get into business fast by looking at your competitors and coming up with faster, better and economical ways of providing the same service or product. New and bigger opportunities are certain to surface once the business gets off the ground.
* Stay focused: Starting a business on a strict budget requires self-discipline, hard work and courage. It’s unreasonable to expect anything to fall effortlessly into place. Be ready for the bumps on the road but no matter how tough things get, stay focused on the mission at hand.
Try out these 10 tips today, I’m sure they would help you start the business of your dreams even if you don’t have a huge financial capital outlay. You can check out my tips for creatively funding your business start –up and getting a loan to start your business.