Starting a business requires an investment of time, energy, and (of course) money. However, entrepreneurship can be more affordable than you might imagine. You shouldn't let financial concerns hold you back from your dream of business ownership.
Many new business models require minimal money and resources to establish. For these types of startups, your time, attention, and creativity will be more important to your success than a huge financial investment.
This guide explains how to start a business with no money (or very little) and provides helpful tips for getting your new company off to a successful start.
Is It Possible to Start a Business With No Money?
Sure, some types of businesses demand a huge amount of startup capital to get off the ground. However, there are many viable business ideas that you can start with little to no money. Online, mobile, and service business models, in particular, can be a great way to cut startup costs.
These days, so much business gets done online, the need for brick-and-mortar locations is negligible. If you wanted to become a boutique owner pre-2000, you had to rent a space. Today? Set up your virtual storefront on Shopify and you're set. An online business will save you money on commercial rent, which is often one of the more significant startup costs that new businesses face.
You can also save money by creating a mobile business. Mechanics, hairdressers, makeup artists, dog walkers, pet groomers, babysitters, elder care providers, interior designers, personal trainers, and massage therapists — these are just some of the businesses that you can take on the road, nixing the need for commercial space (although you will need a car).
Service businesses (which are also mobile a lot of the time) are another good choice if you're looking for a low-cost startup model. For example, you can offer landscaping or cleaning services at someone's home. Service businesses are ultimately about simplifying someone else's life. A virtual assistant is a great example (and is something you can do from home).
What Business Is Right for You?
Even if you narrow your list down to online, mobile, or service businesses, that will still leave you with hundreds (if not thousands) of business models to choose from. The key to a low-cost startup is to tap into the skills, resources, and experience you already have at your disposal.
It may require some creative thinking to figure out what's best for you. Ask yourself these questions:
- What formal education do I have?
- What work experience do I have?
- What hard and soft skills do I possess? Hard skills could include using certain software, like Photoshop or Excel, while soft skills include traits like good communication.
- What am I passionate about? For example, maybe you're a hobby knitter, enjoy creating photo collages on Canva, like baking, or are a social media addict.
- What resources do I have in terms of time, tools, and space? For example, maybe you have a garage but no car. That's valuable storage or work space.
With these questions, you can start brainstorming startup ideas that will require minimal investment — because they will center around the expertise and resources you already have at your disposal. For example, let's say you love creating photo collages on Canva. You're also adept at Photoshop, have previous work experience as a graphic designer, and hold a fine arts degree.
However, you don't have loads of time. You're planning to start your business alongside a full-time job and can't allot hours in your day to client meetings. A standard graphic design business isn't the best fit in this case.
But what about selling premade book covers? There's a big self-publishing industry of authors seeking ready-made, professional-looking covers. You can design the covers whenever you have spare time (e.g., on the weekends), upload them into an online shop, and market them cheaply via social media by targeting self-publishing groups.
Businesses Requiring Little to No Money to Start
The above scenario is just one example of how out-of-the-box thinking can help you discover a low-cost new business idea. To help inspire you, here are some of the best business ideas that require minimal upfront financial investment:
- Blogging and ghostwriting for others
- Tailoring and alterations
- Aerial videography and photography
- Stock photo, event photography, or product photography
- Selling homemade crafts or clothing on Etsy, eBay, etc.
- Baking or catering
- Child care services like babysitting or tutoring
- Pet care services like mobile grooming or dog walking
- Renting a room in your home via Airbnb
- Consulting in a niche you're familiar with
- Translation or interpreting
- Hosting online fitness courses
- Mobile makeup or hair services
- Driving for Uber or Lyft or establishing your own airport transfer service
- Reselling products on Amazon
- Web design or development
- Virtual assistant
- Refurbishing and selling antiques, art, or furniture
These are just a few ideas. Again, you shouldn't just pick from a list like this blindly. Remember to pick something that fits your existing experience, skills, and resources. For example, aerial videography and photography services are great if you already own a drone.
Tips for Starting Your Business With Little to No Money
Regardless of what type of business you opt for, there are a few tips worth following to keep expenses low. Keep these pointers in mind.
Do All of the Work Yourself
Once your business grows and makes a steady profit, you can consider outsourcing work or hiring employees. Until then? It's best to do all the hard work yourself. This will spare the expense of paying other people. This is also a great way to get full oversight and an in-depth understanding of your new business. Plus, it gives you the chance to identify cost-cutting measures.
Use Free Resources
Even if you choose a business model based on your existing experience, skill set, and resources, you won't necessarily know how to do it all yourself. For example, let's say you want to promote your business online but don't know much about digital marketing. You'll want to do your research before getting started.
In these instances, rely on free resources whenever possible. YouTube tutorials, web-based resources, your local library, and online learning platforms (like Udemy, Skillshare, and Curious) are all possibilities.
Keep a Job Outside of Your Business
If you're starting a business with little or no money, you'll probably want to maintain a regular source of income beyond your startup. This will provide you with financial security and a means of funding your business's few startup costs. Plus, if you end up growing and scaling up your business, you'll likely have to increase your financial investment.
If you have an existing day job and want to make time for your entrepreneurial endeavor, you might consider cutting back your hours. Otherwise, look for part-time or freelancer work that you can do flexibly to maintain a steady cash flow.
Research Small Business Grants and Other Low-Cost Funding
Even a low-cost business model will likely require a small amount of startup capital. For example, formally registering a business as a legal entity with your state (e.g., a limited liability company) will usually require a filing fee. A small business grant can help cover such expenses, as well as the cost of any tools or materials you may need to get going.
The U.S. Small Business Administration (SBA) is a great source of grants. You can also consider crowdfunding platforms like GoFundMe or Kickstarter. Peer-to-peer lending is another option. This is generally a faster means of getting a small business loan than going through a formal lender like a bank. Possible platforms include LendingClub and Upstart.
Ask Friends and Family If They'd Like to Help
You can also consult your personal acquaintances for informal loans to cover startup costs. This also helps save money since your loved ones will likely be generous when it comes to the interest rate. Still, make sure to clarify the details of any personal loans. How much are you borrowing, when do you need to pay it back, and at what interest rate? It's best to write this all down.
Carefully Budget Any Income and Expenses
You want to make careful use of your startup capital if you're starting a business with little to no money. Carefully track all of your expenses and income to make sure you're on top of financial matters. Careful money management will also be important when tax filing season arrives. For example, you might be able to claim some startup expenses as tax write-offs.
Manage Your Small Business Finances With Ease Using Skynova
Skynova helps small business owners like you stay on top of their money management minus the stress. Our accounting software allows you to easily track and manage income and expenses, while our business templates streamline paperwork like issuing estimates, bids, bills of sale, and more.
By ensuring hassle-free financial management, we allow you to have more time to focus on growing your successful business — whatever that may be.
Notice to the Reader
The above content is meant as a general guide and may not apply to your specific situation. When starting a new business, check your state's business formation guidelines to ensure you are in line with all legal obligations regarding licenses, permits, and other possible requirements. Further, always consult with a professional accountant to ensure you are meeting all requirements regarding tax filing and reporting and maintaining bookkeeping best practices.