Having a great and unique idea that can be translated into a business is a fun and exciting prospect that has led many people to becoming their own boss. In today’s working world, people are ditching the traditional 9 to 5 to start their own business and work when they feel like it. However a lot of start-ups require some capital to get started which isn’t always that accessible for some people.
A lack of funds should not deter you from starting your own business as there are many ways in which you can still achieve your dream. If you have confidence in your vision with a clear game plan then you can definitely achieve your goals. The funds aspect may be important but isn’t the most crucial for a new business to succeed. We have put together some pointers that you need to take into consider to help you start a business with no money.
Keep your current job
If you are planning on starting a business one of the most important things that you need to take into consideration is to be practical. For your business to work you will need a steady income before everything can be set up. By retaining your current job you will be more financially secure when it comes to actually taking certain risks with your new business (i.e. buying capital or equipment).
Keeping your current job means that you will be investing more time of your life across multiple things but will make the transition from employee to business owner a lot easier. You will have nest egg set up and you will be saving money while you are working on the foundations of your business rather than jumping into it with no safety net.
Work on your business
While one of the hardest things about a start-up business is the idea behind it, you still need to put in some hours to start your journey as an entrepreneur. Before you quit your job with some capital you need to flesh out a few things about your business and the model that it will take. Taking the time to do your research and understanding what will make it work is critical to its success.
You should be asking yourself some questions before you get right into it such as: Is the business idea really unique? Does my target audience actually want what I’ll be doing? Is it something that will make their lives easier that they haven’t thought of? Understanding the originality as well as if it will be a ongoing model will ensure that you don’t sink before you start to swim.
Analyse the market and potential challenges
Once you have identified an idea that could potentially be made into a business you need to analyse the market and understand who your competitors will be. Are there others in the market producing the same product or service that you are planning on doing? Additionally will you be able to compete by providing a similar product and service? Potential investors will ask you these questions when you are looking for funding. It’s vital to understand the market before you jump into it.
Identifying trends as well as challenges that your business will face is also important. Once you know the environment and what will be the hardest challenges you then need to come up with a plan to combat these issues. An example would be if a company already in the market holds the majority share how are you going to get a consumer base of your own? A potential strategy may involve undercutting their prices as to convince others to try your brand.
Understand how much capital you will need
Businesses require money to start and that’s a fact. Whether it’s your own money or from an investor is beside the point, for them to get up and running someone needs to be paying the bills. Understanding how much you need and developing an extensive plan of all costs will be appealing to potential investors as well as banks when you are applying for a loan. Having a clear idea of the costs will also give you a realistic value of what your business will be worth which is another great factor when trying to gather funds.
The financial plan is a very important part of your business model as once you get the funding where will it be going? You need to have all avenues explored so that you aren’t left short or go over budget when trying to get it off the ground. Again these plans should be put in place before you obtain the funds as investors would like to see them to understand where their money will be going.
Crowdfunding has helped a lot of start-up businesses become successful thanks to the power of the internet. If a company is able to successfully explain their business idea and why people should invest in it, you will be surprised how many people will get on board. Many internet or electronic based ideas such as video games and software tend to reach out to crowdfunding platforms as their target market is most likely already on there.
Being able to effectively convince people why they should invest will be the tricky part. There are many cases of start-ups merely just pocketing the crowdfunded amount so there has to be a level of commitment and dedication to your cause that people can notice.
Networking is vital when you don’t have your own capital to start a business. Finding the right people to help you will make the process a lot easier. Events and trade shows are great places to find potential investors or people who may know someone else that will be passionate about your cause. Online forums and social media are also great places to network with people as well as finding useful resources and tips when you are first starting off.
Having a strong social media presence (such as Facebook) for your brand is also an effective way to garner attention. The majority of investors and venture capitalists are very active on social media and if your brand starts to make its way around they could potentially find you. Wowing them before you give your speech will make the investor conversation a lot easier.
Test your business
If you are unsure whether your new product or service will hack it in the business world, the best way to understand its actual effect would be to have a trial run. If you are making a new product giving out free samples to people and gather their feedback. Seeing how people respond along with their feedback can be very useful for how you move forward. Be sure to give the samples to your intended target audience as well as they will be the ones using your products or services if the business does go live.
Trials can give you new insights as well as identify challenges that you may not have thought of alone. New perspectives are very important when it comes to starting a new business.