15 Dec Think BIG, START small: How to Start a Business With Almost No Capital

I have noticed that although many young entrepreneurs have amazing business ideas they usually put them on hold due to a lack of financial resources. They tend to assume that their idea will never get far off the ground unless they have major funding behind them. Every day there is a new startup receiving millions of dollars or euros from venture capital firms but what people don’t hear about is the high startup failure rates causing these newly created businesses to shut their doors forever.

I do believe that if your idea or plan of execution is not well thought out right from the start, no amount of money can turn it into a winner. Do you have a great business idea but very limited capital? Don’t let that prevent you from starting your dream business! Yes, I know… There will be ridiculously long days with little to no sleep. Yes, you are going to be stressed. But people who want it bad enough will finally manage to make it.

I hope the following tips will help you get your business idea off the ground with limited capital:

1. Build your business around what you already know. Instead of venturing off into uncharted territory, try to make sure that you build your business around your own skills and knowledge. Because the less you have to rely on outside sources the better it will be- at least during the first stages. Building your business around your own personal expertise allows you to eliminate consultants, unnecessary expenses and outside assistance. Also, very often, having that- often ‘‘limited’’- knowledge is sometimes all that is needed to successfully take the plunge into entrepreneurship.

2. Tell everyone you know about your new business. Inform your family, past colleagues friends and business contacts about your new business. Call, send emails and make sure your new venture is known on all your social media profiles. Your family members and friends can help you spread the word while past business contacts can introduce your brand to their own professional contacts as well. This type of ‘‘grassroots marketing’’ can help introduce your new baby to a much larger audience.

3. Avoid unnecessary expenses. You are going to have plenty of expenses, and I will agree that some of them simply cannot be avoided. Overspending is something that you can avoid though.Take something as simple as business cards for example. You could drop over $1,000 on 600 metal business cards that give off that “cool” factor, or you could just spend $10 on 500 traditional business cards. Being frugal in the early stages can be the difference between a successful and a failed business.

4. Don’t get buried in debt. My mother used to tell me when I was a school student ”never borrow anything from anyone”. I believe it was a very useful piece of advice. When it comes to credit there is a smart way and a catastrophic way to use it when starting a business. Office furniture, new computers, phones and office supplies can all quickly add up in huge sums. Instead of purchasing all those things at once and throwing it all on a credit card, try to use your company’s revenue to finance these expenses. Eliminating the stress and burden of debt is going to increase the chances of creating a successful business.

When I started my first business I didn’t pay a penny out of my pocket. My customers paid for that…I used the money from my first 2 projects to cover the expenses for the company registration, the opening of the corporate bank account, the registration of the company’s trademark and the creation of the website. If I made it, you can too!

5. Make the most of free advertising and marketing. There are several ways to generate a buzz for your business without breaking your bank account. Social media is a great way to gain exposure and interact with your potential customers. Another thing you could also do is reach out to local media (press, radio, newspapers) and offer your expertise for free.

Make as many local media contacts as you possibly 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.

6. Build up sweat equity. When I first started my own I worked around the clock every day, handling every single aspect of the business as well as all the marketing and growth. All of the long days and hard work hard work you put in are not for nothing. You are creating a brand from scratch and all this hard work is essentially increasing the value of your new business. Your sweat equity will come into play if you ever decide to take a partner or even sell off a piece of your business.

7. Be ready to hustle. Hard work will be an absolute necessity, but when you are starting a business with little or no capital you must be prepared to dedicate everything you have into making your business a success. This might mean cold calling, dealing with billing and accounting, handling customer support, and every other operational part of your business. You will have to wear many hats and it will require most of your time and energy, if you are to make it.

My advice is that you don’t let limited capital stop you from taking a great business idea and running with it. It will be difficult and you will have to face several stressful situations…but that is part of entrepreneurship.

Have you started a business from scratch, with sweat equity alone? If so, let me know about your personal experience in the comments section below.

2017 All rights Reserved by Danai Krokou