How to Start a Small Business with No Money to Invest
Starting a business with no money is 100 percent doable. In fact, you’ll have an easier time today than Google, Apple, Disney, Mattel and Harley Davidson had when they were started in garages decades ago.
Why? Because never before has it been so cheap and easy to go from idea to startup, build something of value and reach a group of potential customers.
Just ask the cleaner who used to pin flyers to grocery store bulletin boards and now advertises through Google to people searching for “toxic-free oven cleaning” in their city. The internet’s connectivity has effectively leveled the playing field.
Instead of startup capital, your currency will be ideas, time and determination. So, here’s a zero-cost plan start and grow your new business.
6 tips for starting a business with no money to invest
1. Solve a problem with an idea, using your passion or skill set.
If you’ve found this article, you may already have a strong idea of what product or service you’re going to sell. The future and profitability of your startup rest on the strength of this initial idea. And with only 50 percent of new business surviving five years or more, you can appreciate how strong this idea needs to be.
The best business ideas are formed out of the convergence of your passion or skill set with a problem that people need solving. That convergence is important because not all passions are useful or marketable. Sure, I’m passionate about eating New Haven pizza, but (sadly) it’d be a struggle to find anyone to pay me for doing it.
Instead, take your current skill set and knowledge of an industry and dig deeper to discover a problem that needs solving. You could even sell a product or service that solves a problem that you have. Because if you have a problem, chances are that somebody else will have it too – and would be willing to pay for a solution.
Since you can’t afford any mergers or acquisitions, finding a niche is the best way to avoid large competition. A niche is a small but profitable subdivision of a market where customer needs are not being met by competitors. Ideally, you want to be the only one selling what you’re selling.
While you can tighten your niche through targeting a specific customer demographic or geographic location, you can also adjust your idea to make it one of a kind.
Here are some literal and metaphorical transformations and examples that you can apply to your idea to make it more unique:
- Divide something up (e.g. baby carrots are carved from pieces of unsellable carrots)
- Take something out (e.g. seedless grapes)
- Combine two ideas in a new way (e.g. cafe in a bookstore)
- Reverse the status quo (e.g. Netflix’s original movie rental with no late fees)
- Exaggerate something negative (e.g. webuyuglyhouses.com)
- Change the speed of delivery (e.g. the Slow Food movement)
- Add automation (e.g. the self-sealing tire)
- Add intensity to the interaction (e.g. Amazon’s review system)
- Change the look (e.g. transparent Band-Aid to inspect the wound)
2. Take your idea public.
One of best ways to give your business a publicly accessible home is to create a website. Fortunately, there are a lot of free or affordable platforms that make it really easy to do this, like Wix, WordPress or Squarespace.
But before you get too carried away with the details, it’s important to think about branding and growth. For roughly $10 a year, you can host a website under your choice of domain name, which will give it a more professional look. A great litmus test for finding unique names is to check whether the .com domain is taken.
Don’t get disheartened that many obvious .com domains today are unavailable. With a little creativity and the following tools, you’ll soon find a unique .com name for your business:
For brand continuity, register this name on whatever website platform you choose and head over to Namechk to secure the social media channels that you’ll want in the future.
Thanks to the ease of today’s drag-and-drop website builders, there’s no need to be able to code (and if you get stuck, there’s a huge user community who can help). Just install one of the free themes and create the basic pages you need:
A summary of your product or service offerings (see next section), highlighting the benefits and how they’re different than competitors.
Pro tip: Use language that appeals to the emotions of your target customer and have a clear call to action that encourages visitors to take their next step towards becoming a customer (filling in an email address, scheduling a meeting, contacting you, etc.).
2. About Page
A summary of your business, who you are, what makes you different.
Pro tip: Be sure to frame every element of your About Page in a way that benefits your customers.
A page full of answers to frequently asked questions.
Pro tip: Not only does answering these questions help to avoid annoying inquiries, you’ll boost your online marketing and help visitors get to know your way of working.
A group of articles that offers value to readers, while showing off your industry knowledge and authority.
Pro tip: Because you don’t have the money to spend on online advertising to attract site visitors, you’ll be relying on organic search. A regularly updated blog that will help you climb Google Search rankings.
A page that makes it easy for visitors to get in touch.
6. Order Now (optional)
If you’re selling physical products online, there should be an easily navigable option for customers to purchase from you.
With the bare bones of your small business’s website in place, relevant imagery will transform its look and feel. Your website will seem more professional if you use your own custom pictures when you can afford it, but for now, a huge range of free images is available from Unsplash, Pexels and Pixabay.
3. Create a minimum viable product.
Born from your business idea, a minimum viable product is a low-cost, low-risk way to test your niche market’s demand for your product. It’s the version of your offering with a minimum feature set for which people are eager to pay you money.
You might think that this adds an unnecessary hurdle to launching your business. But by conducting this test early, you avoid building a product that nobody wants and can gain vital information straight from your target market. They might even communicate areas where they feel features are missing.
Validate your minimum viable product by adding it to your website’s home page and ask visitors to register their email to receive an availability notification. By the end of the test, you should be able to answer the following questions:
- What am I selling?
- What is the right price?
- Who will be immediately compelled to buy?
- What’s my product’s primary benefit?
- What’s my product’s important secondary benefit?
- What are the key objections to my offer?
- How will I counter these objections?
- Why should someone buy this now?
- What can I change to make my offer more compelling?
4. Set up a way to get paid.
Once you’re happy with your how your first product or service is communicated and confident that it scratches your target market’s itch, you need to set up a payment method.
An easy option is to set up a PayPal account for free. It also means that customers from all over the world can hand over their cash in exchange for your product.
If you’re offering a service, you’ll need to invoice your clients. An invoice template takes the hassle out of creating an invoice. It covers when and how you want to get paid and your debt collection policy.
5. Communicate your product to the world.
Gone are the days when your ability to promote your small business was determined by the size of your wallet. In fact, it’s possible to build your entire customer base without any paid advertising at all.
Instead, email and a regular social media presence are all you need.
To maintain a consistent social media presence, strive to do the following:
- Post one to three helpful items per day
- Respond to questions
- Ask different contacts in your network to promote share your posts
- Connect with existing prospects or customers to make sure they are happy
Your website should also give visitors the option to opt-in with their email address. As your list of contacts grows, you can use free email platforms to market to them on a regular basis.
Pro tip: When growing your email list, focus on quality, not quantity. At the end of the day, having a small, engaged list is better than having a massive, inactive contact database.
6. Try expanding your products, services or target market to scale future growth.
As you go through the stages of building your startup, it’s important to receive feedback and to test new ideas. The best part is that none of the above costs anything apart from your time and creativity.
Once you discover a business model and product or service offering that works, here are some ideas to help you scale the business further:
- If you sell a physical product, consider adding a service (e.g. if you sell language tools, consider offering in-person or online language classes).
- If you sell a service, add a product (e.g. if you sell toxic-free oven cleaning, also sell a book on how to make your own green cleaning products).
- Sell a product or service to a broader range of customers with related interests.
- Sell more by going deeper to the same customers with different levels of need.
Scaling for future growth tends to be easier than starting a small business. By expanding your products, services or target market up front, it’ll make future growth more manageable.
Remember: Don’t give up.
No matter what your small business venture throws at you, it’s important to keep going. At any stage, it can be easy to become paralyzed by over-analysis. After all, nobody said that creating and growing a business from scratch would be easy.
Instead, counter fear or hesitation by taking massive action. As Friedrich Engels said, “An ounce of action is worth a ton of theory.”
Carly Stec is a Senior Content Strategist and former Marketing Blog Editor at HubSpot. Aside from content, she has a strong affinity for house plants, New Haven pizza (#TeamModern), and anything Kate Spade.