Running your own business can give you the freedom to pursue your passion, shape your life the way you want it and improve your financial situation. Many people dream of running their own business, but only a small percentage of them turn their dreams into reality. Having little or no financial resources is one of the most common reasons people give for not starting a business, but lack of money doesn’t need to be a barrier. Here’s how to start a business when you don’t have any money.
The first thing you need to do before starting a business is to make sure that you have enough income to cover your necessary living expenses for the first year of trading. You won’t be able to rely on the money coming in from your new business, so you will need a separate job or another income source, such as savings, to pay for your living expenses.
Draw up a budget to identify any areas where you can make savings. Look for cheaper deals on utility bills, phone contracts, and other regular outgoings. Consider ways to reduce the cost of groceries and anything else you need to buy, as making a few sacrifices will reduce the amount of money you need to spend on your living expenses.
It’s important to think about how a new business will affect your current responsibilities. For example, if you are a full-time caregiver for your children, partner or somebody else you may need to consider finding extra support or making alternative arrangements.
If you are heavily involved in social, community or other activities, you might decide to reduce the amount of time you dedicate to these events, at least in the early stages of your business. Plan and organize your time efficiently to get the right balance in your life.
Writing a comprehensive business plan is crucial for all businesses, as it provides a valuable roadmap and helps to clarify the business idea. Writing a personal business plan meant only for your eyes gives you the opportunity to create a clear plan of action. You can use it to set goals and to create a step-by-step guide for achieving your aim
if you intend to apply for funding, you will need a formal business plan that includes well-researched information, including a study of your competitors, intended customers, and the general climate within your area of expertise. You will need to add market research, pricing analysis, a marketing plan, and a financial forecast. If you don’t feel confident writing a business plan, consider paying a professional to do it for you. While it may not be cheap, a professional business plan could make all the difference when applying for funding.
Finding the right funding for your new venture will depend on the type of business you intend to start and the amount of money you need. The first step is to work out exactly how much money you will need to set up your business. It’s important to be realistic and to include essential running costs, as well as an emergency fund for unexpected expenses. Once you have an exact figure, It’s time to look at your funding options.
If you only require a small amount of money, you may be able to fund your business using credit cards, savings or small loans from family and friends. For more substantial amounts of money, there are several ways to support a new business. Bank loans, business angels, independent, investors and crowd funding are the most common options for new business owners, but it can take time and patience to find the right funding source. The key is to create an attractive pitch that convinces potential investors to look at your full proposal and business plan.
Making a Pitch
If you expect a potential investor to look at your business plan or proposal, you have to grab their attention with a compelling pitch. Investors want to know that you are passionate and knowledgeable about your business, so it’s important to understand the industry inside out.
Try to look at your business idea through the eyes of a potential investor. Why would they want to take a risk on your business? What sets you apart from the competition? What will investors gain from being associated with your business? Try to look beyond the financial benefits, as investors sometimes have other motives for funding new companies. For example, they may be looking for ethical or environmentally friendly companies to help improve their reputation.
Finally, persistence is the most critical factor when looking for investors for your business idea. You will almost certainly receive rejections and refusals, but you can use these to improve your pitch and modify your proposal for the next time.