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I Want to Start a Business, but I Don't Have Money. What Do I Do?

Photo by Pavel Danilyuk | Pexels

Starting a business with minimal capital can be a daunting challenge, but with the right strategies, it's entirely possible. We've gathered insights from 22 founders, CEOs, and business owners, focusing on the wisdom of those who've successfully navigated this journey. From leveraging LinkedIn for referral partners to utilizing free or lite software tools, discover a wealth of resourceful steps to establish your business on a shoestring budget.

Leverage LinkedIn for Referral Partners

I recently had a conversation with a prospect who was draining her resources on countless services and products that 'experts' claimed were essential for business success. It was both heartbreaking and infuriating. She's an industry expert, and her new venture aligns perfectly with her previous work. In just a few minutes, I demonstrated how to leverage LinkedIn effectively to find valuable referral partners. Together, we crafted a referral strategy that could generate immediate income.

Here's the truth: if you have a phone and LinkedIn, you can kickstart your business without spending a dime. Instead of investing in a website or a speaker's reel upfront, use LinkedIn for visibility and gather written and video testimonials. While you might need more sophisticated tools down the line, start simple with the resources you have and the support of your network. Remember, it's possible to launch with zero cost—just your smartphone and a solid network can get you off the ground!

Viveka von Rosen, Founder, Post-Executive Coach, Beyond the Dream Board

Choose the Right Sales Platform

I would ensure that I'm using the most efficient platform for the size of my business. If my budget is tight, it's vital to do research on which platform would make the biggest impact. It could be a physical, digital, or social media store, for example.

If I were looking to sell self-made clothing, I would do research on my target market and find out where they usually shop. There's no point in setting up a store on Facebook or Instagram if the target audience never makes purchases there. If I set up a physical store, I need to ensure that I would make a profit after paying the rent.

The point is to be brutally honest about your business's prospects before setting up. Starting small is a great way to gauge interest. But you need to have a business and development plan to ensure that you take the right steps to grow your business.

Alister Wood, Owner, VisitUs

Utilize Leverage and Expertise

In my experience of starting multiple businesses with little to no cash, I rely on leverage. You can leverage other people's capital, knowledge, time, expertise, and network to springboard your business. Ensure it's a win-win structure for all parties, and that way, you can build a sustainable and long-term business.

Another approach would be to start a business that relies on your expertise to deliver. That way, you can start with little to no cash and use the revenue generated to hire and grow your business.

Vignesh Wadarajan, Entrepreneur, Vignesh Wadarajan

Adopt an Abundance Mindset

One effective strategy for starting a business with little money is to switch from a scarcity to an abundance mindset. You create abundance when you look at your business through the lens of 'do more with what I already have.'

Focus on being resourceful and stretching every dollar. Instead of buying a new monitor, put it towards your ad spend. If you're not a web designer, find one who needs a skill you do have and exchange work with them. When a shiny new tactic is making the rounds, double down on proven marketing pillars like creating expert, authoritative SEO content and investing in owned media by building your email list. Don't pay for separate platforms to manage your financial operations when you can bundle and save with an all-in-one solution that offers invoices, accounting, payments, and payroll.

Customers are loyal because of the quality of your product and the relationships you build with them—not because you have the latest equipment in your office.

Dave VerMeer, Founder, NamePepper

Exchange Skills for Resources

One of the critical steps in establishing a business with sparse funds is to leverage what I call 'Sweat Equity Exchange'. This essentially means capitalizing on your unique skills and expertise to compensate for the lack of monetary investment.

For instance, if your forte is in web development and you want to start a consulting business, rather than paying for an office space or mentoring programs, you could offer to build a great website for an organization that could offer you these resources. This savvy exchange of services enables you to establish your business using what you already have: your skills and knowledge. You'd be surprised at the value people place on skills they lack and need. This approach is beneficial because it not only gets your foot in the door but also brings you into contact with potential mentors and clients in your industry. So, sweat equity isn't just about hard work, but also smart, strategic work that positions you for success even with limited funds.

Casey Meraz, CEO, Juris Digital

Optimize for Search Engine Visibility

One step I recommend all business owners take in establishing their business without a lot of money is getting to know Search Engine Optimization and setting up a Google Business Profile. Having a business that shows up easily when people are looking directly for what you have to offer is invaluable. You can not only have reviews, business updates, and offers directly on the profile, but you can also connect your shop so people can buy directly from your business without having to go to your location or search your website.

Marissa Loewen, Founder, Create the Rules

Brand Your Business on Social Media

I was never rich and didn't have an infusion of capital, really. I have a small, local renovation business, and I think most businesses start out this way; we don't have investors. The trick here, I think, is to harness social media as much as possible. You hire a good designer or social media person, and you do branding right. If you get the word out there, and your business looks right, then customers will come, employees will come, everything will come. It's a sort of 'fake it till you make it,' I guess, but in 2024, I do believe it's an essential part of getting started with no money. If you look cheap, you won't get anywhere.

Rick Berres, Owner, Honey-Doers

Build Credibility Through Experience

I would first focus on building a strong foundation of skill and experience. Before starting the business or acquiring the funds you need, polish your skills and gain experience in the niche you want to venture into. It will be the foundation that supports everything else you do.

Years of competing at the European and World Championships, including the Olympics, gave me the experience and knowledge I needed to start my training program. It gave me the credibility to attract clients who trusted they would be getting instructions from someone who knows what they are doing. If I had started my company without having lifted weights or competed myself, it wouldn't hold the same weight. Start by gaining experience and building trust through your skills. You will be surprised at how many people would be willing to chip in financially for your business or work with you because of your expertise.

Oleksiy Torokhtiy, Founder, Torokhtiy Weightlifting

Develop a Minimum Viable Product

Starting a business is hard—especially when you don't have much money to put into it. Forging a way forward can be both complex and costly, but one of the first and best things that an entrepreneur can do is to build a Minimum Viable Product (MVP). An MVP is a version of a product that has just enough features to satisfy early adopters and to obtain valuable feedback that can influence the development of the next product iteration. In other words, it is a way of maximizing value and minimizing waste associated with bringing a product to market. The MVP also allows you to enter marketplaces more quickly and with less risk.

The MVP model works well in this regard, as it helps you develop just the core functionality necessary to deliver something that will help meet the primary needs of the target end-user, without incurring the costs and time that are wasted on the bells and whistles that don't relate to the core function of your product. For example, whether those products will shift, before committing to building your own branded e-commerce site infrastructure that is custom-built to the needs of your extremely niche target market.

Furthermore, an MVP approach pushes you to receive continuous feedback, in an iterative process that gives constant new insights. You increase your chances of product-market fit. And, this way, you build a group of customers who feel that their voices have been heard and, most of the time, their ears won't be completely burned by the product you're selling because they feel that you are listening to these voices. In other words, for the entrepreneur, it's the cheapest way to learn the ropes.

Erika Kullberg, Attorney, Money Expert, and Founder, Erika.com

Partner with Complementary Skill Sets

We established our business by contributing just $500 each when we started. I would say a step you can take is to find a business partner who possesses the skill sets that you don't have and together be able to deliver a service to the customer. This goes mostly for service-based companies, and it's a great way to start with what you have and build a team over time as you get sales and can reinvest back into the company. This is exactly what we did when we started our company by doing all the work ourselves and scaling over time.

Hannah Ryu, Co-Founder & Director of Strategy and Operations, Oak Theory

Validate Business with LinkedIn Network

Earlier this year, I was impacted by tech-sector layoffs where I didn't have much time to prepare for my next career move. I knew I was ready to start my own business, so the first step I took was to reach out to relevant people in my network on LinkedIn.

Through reaching out to relevant people on LinkedIn, I validated that my business concept was valuable to potential customers and I could start without major running costs. The response was so positive that I got my first three customers directly from reaching out to people I already knew.

My advice is to tap into your community on LinkedIn before you start your business. It's likely that the people who know you the best are the ones who can help you get started. It doesn't cost anything to send a message to your LinkedIn connections, so make sure to reach out early.

Lari Numminen, Growth Advisor, Generate More

Pre-Launch with a Customer Base

To kick-start a business when funds are tight, it's crucial to cultivate a robust pre-launch customer base. This tactic entails spotting potential customers early and keeping them involved as the product takes shape. We embraced this strategy by tapping into online forums within our sector. Our active participation and the valuable insights we shared helped us forge bonds and pique interest in our services even before we officially hit the market.

We welcomed input and ideas from these initial supporters, which not only fine-tuned our offerings to better suit their needs but also fostered a sense of belonging and commitment among them. This proactive approach to engagement meant we could scale back on hefty marketing spends after launch, having already established a core group of enthusiasts ready to spread the word about our product.

Moreover, this method greatly reduced the financial risks typically associated with launching a product. With a customer base poised to buy as soon as we launched, we generated early sales that could be plowed right back into the business, fueling growth without the need for a large initial investment. This strategy didn't just make our market debut successful—it also set us up for lasting stability, proving that financial hurdles can be overcome with the right strategy.

Alvin Poh, Chairman, CLDY

Promote Early for Brand Recognition

Whenever I start a new business, I begin by letting people know about it through word-of-mouth and digital communication while still ironing out the infrastructure. Since most potential customers need consistency and repetition before deciding that a business is real, getting a jump-start on customer awareness leads to a jump-start in sales. This way, when I'm ready to provide my product to customers, they will recognize my brand and have sufficient comfort with it so they can move forward. Starting before you're fully ready provides a quicker turnaround and insight into the best way to roll out a business.

Roshawnna Novellus, Partner, We (Zoe & Ali)

Launch with Content Marketing

One effective method I recommend is content marketing, which was instrumental in launching our business. Whether it's writing articles, producing videos, or designing infographics, there is a medium where you can leverage your skills and experience to create helpful content that reaches your target audience.

For us, writing search-engine-optimized articles was crucial for our initial growth. By identifying long-tail keywords with high purchase intent, you can precisely target and create content that attracts a more purchase-driven audience to your offerings.

We also amplified our content marketing efforts by repurposing SEO content and sharing it in formats that appealed to different audiences across various social media platforms where our customers are active.

Michael Raviv, CEO, DCatalog

Utilize Leverage in Business

There's a false belief that in order to start a business, or even buy a business, you have to have a bunch of money. But think about it: if you have a ton of money already, there wouldn't be much reason to open Pandora's box of entrepreneurship. At that point, just be an investor.

Being an entrepreneur, at its origin, is the ability to make something from nothing. Jean-Baptiste Say, the economist who coined the term 'entrepreneur,' wrote this:

"The entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and greater yield."

With that said, the one step necessary for this journey is understanding leverage.

'The exertion of force by means of a lever, or an object used in the manner of a lever.'

Essentially, using a lever or force to move an object and achieve an outcome.

It's a little abstract, but it's literally the key to making money without money. In business acquisition and real estate transactions, we use seller financing or SBA loans (the levers) to take down deals (the outcome) with as close to $0 down as possible.

In startups, we leverage an audience (the lever) to validate ideas and find paying customers before building anything (the outcome). This prevents us from wasting time and money on something that doesn't end up working.

In order to really be successful, you don't need the next million-dollar idea, you don't need to be rich, you don't need to be 'an expert' (or whatever that means)... You just need to be able to identify the opportunities that already exist in your circle and find that 'lever' to produce your desired outcome.

Kevin Bell, CEO, KBellCo

Show Expertise Through Free Content

I'd start by demonstrating expertise via the free content I publish online. Actually showing others how to solve a key challenge, pain point, or problem in their lives or businesses (instead of just 'claiming' you can!) will separate you from 99% of your competition online.

Next, I'd put my personality into my content, building an authentic, relatable personal brand that attracts my ideal clients and repels those who would be a terrible fit as clients or customers.

There are billions of people on Earth - you don't need all of them to like you or do business with you.

The truth is: Your biggest advantage in today's online marketplace is YOU—your unique story, personality, communication style, etc.

Do these things, and you'll soon have more business than you know what to do with!

John Nemo, CEO, Nemo Media Group

Document Processes and Use Free Tools

It's important to prioritize which processes are most important to your business, whether you have funding or not. This will allow you to start documenting those processes and pinpointing software tools to help. These software tools are often free or come at minimal cost, so having these tools in place to address your company's processes at an early stage will set your company up for long-term success.

Brian Ng, Head of Startup Sales Strategy

Build a Personal Brand on LinkedIn

A highly effective way to scale your business for free is to build your personal brand on LinkedIn.

Along with cultivating a strong online community and network, there's huge potential for brand exposure because of the organic reach—both of which can increase lead generation and sales.

I personally generate 3 million content impressions and 12-15 inbound leads per month on the platform.

My advice for anyone looking to leverage their personal brand is:

Study the profiles of favorite creators and industry leaders. Then turn your own profile into a sales landing page. Post regularly, and ensure your content is infused with personality. Dive into your subject expertise, give industry insights, and solve real problems for your ICP. A fail-safe is to post universal content that aims to evoke emotion, tell a story, and inspire the reader to take action.

An effective content strategy can fuel your business growth while generating opportunities you never thought possible (aligned leads, collaborations, PR, investor interest, etc.).

Don't have a budget?

Start building your personal brand for $0.

Shoaib Ahmed, Founder & Director, Yello Hippo

Craft a Strong Value Proposition

Know your value proposition. Your value proposition is comprised of your product or service's features and benefits. Once you understand your unique point of view and the value you are offering to a potential customer, creating marketing messages that convert your ideal customer will be much easier. The more you can attract your ideal customers, the easier it will be to establish your business.

Tina Wells, Founder, Wellspring Studio

Choose the Correct Legal Structure

In my legal practice, one fundamental step I recommend for establishing a business without significant financial resources is to focus on structuring your entity correctly from the outset. Choosing the right legal structure for your business—be it a sole proprietorship, partnership, LLC, or corporation—can have substantial implications for your liability, taxation, and ability to attract future funding.

For example, starting an LLC has proven beneficial for many of my clients due to its flexibility and protection from personal liability. This structure allows you to keep startup costs low while safeguarding personal assets. One of my clients started a consulting firm as an LLC with minimal capital. By keeping overhead low and focusing on building a strong client base through strategic networking and offering value-laden services, they managed to grow substantially without hefty initial investments.

Additionally, pay keen attention to drafting solid foundational agreements, such as owner agreements and client contracts, even if you're drafting them with minimal legal assistance initially. These documents are crucial and can protect your business from early pitfalls. A well-drafted agreement prevents misunderstandings and provides a clear framework for operations, which is invaluable when funds are limited and legal disputes can be financially draining. In my experience, clear and thorough initial contracts save substantial amounts of money and time, align stakeholder expectations, and build credibility and trust in professional relationships.

M. Denzell Moton, Esq, Owner, Moton Legal Group

Identify a Unique Disruptive Proposition

One effective step to establish a business without substantial financial resources is to focus on identifying a unique disruptive proposition (UDP) within your niche. This involves pinpointing what isn't working or what is less known in your targeted market, and devising a solution that either improves upon existing options or introduces an entirely new approach. By innovating in this way, you can create value with minimal investment, leveraging creativity and insight instead of capital. This strategy not only sets your business apart but also engages potential customers who are eager for original solutions. In essence, it's about reinventing the wheel in a manner that offers tangible improvements or alternatives, which can lead to significant traction without the need for heavy initial funding.

Danielle Fitzpatrick Clark, CEO and Founder, Influence Builder

Utilize Free or Lite Software Tools

These days, a significant cost of establishing a SaaS or similar online business is all the software tools a founder will feel pressured to use in order to maximize productivity and organization. After all, time is our greatest asset. Many of these different software tools can cost upwards of $100 a month, leading to significant costs that bootstrapped entrepreneurs simply can't afford.

My suggestion would be to always do research to see if you can utilize a free or "lite" version of a software tool if the productivity loss is minimal. This can save you hundreds, if not thousands, of dollars in start-up costs.

For example, instead of purchasing expensive project management software, if you can get by with Gantt charts in Google Sheets for free, that's a sacrifice you should be willing to make to cut costs if you don't have a lot of money to spend. Instead of purchasing a CRM, maybe you can capture all the notes in a Google Doc until your business grows larger.

There are always workarounds and cost-effective options you can explore instead of buying software—don't get sucked into the trap of paying for things you don't need, especially early on in your entrepreneurial journey.

Cassie Fields, President, Autoleap