Can you believe you don’t always require a lot of capital to start and run a business?
Yes, the fact is, at times, you can start a business with little to no funding. Hard to believe. It is quite possible to start a business without money, even though it seems far-fetched.
It is an undeniable fact you can start and scale any business you want, but you will need a lot more than just extra cash flow. There are various elements to starting a business, from getting partners, investors, and a solid plan to use the funds you have in your new business to grow. However, you should know when one starts, they start small. You can start a business in any smallest size you would like.
Starting A Business with No Money
Let us say you wish to open a storefront to sell your hand-crafted jewelry; you could start by selling it to your family and friends to build a reputation and get the starting feedback. After that, you would sell them online on third-party websites. The final step would be to start your website. It gives you an idea of how a business can start with minimal finances.
If you have worries about starting a business with no funds, we have a few ideas on where to start.
1. What Can You Do or Get For Free?
This is the first question you must ask yourself, especially if you have no finances and want to launch your business. We should be real and admit that it is extremely easy to create a list of all hurdles that could affect you and stand in the way of you opening a business. This question is not only for people with no finances. It is also for people who are scared to use money. You would stop and reflect on what you can do today without it.
Ask yourself what is important for your business, not only to launch it but to keep it running also. For example, will you need a custom-designed website specially created for your products or services, or could you start with a Facebook page to advertise it locally?
Or, could you get away with posting your products on third-party selling sites like eBay, Etsy, Amazon, and so on? Can you use Canva to design your marketing materials instead of hiring someone to do it for you? Moreover, could you sell and trade your product/services/skills/resources with someone instead of paying?
The internet has now provided us with many free resources. It would be best to list everything you will need for your business, then with the help of internet research, all the free alternatives to those things. However, remember, it is not something that will happen overnight. It will take time and might even require you to gain some digital skills (you can always find them for free), and doing so will help you save money.
2. Save for Six Months of Living Expenses
For many, jumping into launching a business by using what they have in their savings account is not the perfect situation. However, it is what entrepreneurs normally do. It would be best to plan everything honestly when creating your business plan. Therefore, be honest with how much you will spend and how much revenue you will most likely bring in.
After that, you must be realistic about how long you will see profit come your way. Normally, it takes around six months before you see a profit. That is why you should save six months of living expenses, so you can face anything and not become homeless, if you know what we mean. It will help you put your time and resources into your business until it brings money in without worrying about living expenses.
3. Get Extra Funds from Family and Friends
It can be hard asking for money from family and friends, but when it comes to business. However, there are two important elements you should remember:
- It is not the charity that you are asking for.
- You are not asking family or friends to support any strange business idea.
You dream of starting a business with a solid plan, so why consider what others think?
Once you have everything figured out and move to finances, you can ask your closest family or friends for a loan.
The thing is, you can use them not only for finances but for many other resources. Some of them are:
- Practice sales pitch
- Get feedback
- Ask them to volunteer with the skills they have
Once you have everything set, ask them for a loan to start you out. However, ensure everything is in writing, and you have a contract with when you will pay them back. You could always use a crowdfunding platform also to encourage people to encourage their networks to put money in to help you.
4. In Need for Extra Cash? Apply for a Small Business Loan
Once your business is up and running, and you think you need more capital as you have been operating on a small budget, you can consider applying for a small business loan.
There are many small business financing options that banks and online lenders provide for various businesses looking for extra cash flow or investment finances. Did you know you normally get more advantageous terms through the traditional bank? However, on the other hand, online lenders can be more lenient when it comes to what you need. No matter what way you go, always keep an eye out for high-interest rates.
If you are looking for something other than a lump sum loan amount, you can think about a business credit line. That can be a good option for purchasing items based on their needs.
5. Apply for Small Business Grants or Local Funding
Small business grants are not always the most straightforward to find or get. However, once you have a business up and running, no matter what size, you can start looking for free cash. One should remember grants normally have very specific application needs. If you meet those needs, you can get the cash that’s all for you to use without worrying about paying it back. Begin by looking through the databases of the government, and always ensure you ask small business administration chapters locally to help you.
6. Look for and ‘Woo’ Possible Angel Investors
Have you heard of angel investors? If not, let us tell you how they come to help. Suppose you are looking to up your business beyond yourself and your loved ones who have invested in your business. In that case, Angel investors are normally the first people unrelated to you or your company to invest in your business.
They are not like other companies or venture capitalists. Angel investors use their funds to invest in your business. Moreover, they can be the best mentors, as they can be former or current entrepreneurs.
Final Thoughts
Never give up. No matter what you have to face, and trust us, you will have to face a lot when starting and running a business. Look for cheaper or free alternatives for your business and see how you can cut costs in many ways. Whether you have money or not, starting a business from scratch will not be easy, for real, but it is possible! What do you think?
