Eight essentials to start your business with little to no capital
23 September 2014
Posted by: Author: Jonathan Long
Long (Entrepreneur Magazine)
If your idea and plan of
execution aren’t well thought out from the beginning, no amount of money can
turn it into a winner.
But don’t let that stop you. Yes,
there will be ridiculously long days with little to no sleep. Yes, you are
going to be stressed. But those that want it bad enough will make it.
Here are eight tips that can help
you get your idea off the ground with limited funds.
1. Get Ready to Work Hard
Hard work is an absolute
necessity, but when you are starting a business with little to no capital then
you must be prepared to dedicate everything you have into making the business a
This might mean cold calling,
handling customer support, dealing with billing and accounting, and every other
working part of your business. You will wear many hats and it will require the
majority of your time and energy if you are to make it.
Don’t let limited capital prevent
you from taking a great idea and running with it. Will it be difficult and will
you have some stressful situations? Of course, but that is part of
2. Take advantage of free advertising and marketing
There are several ways to
generate a buzz for your business without breaking the bank. Social media is a
great way to gain exposure and interact with potential customers. You can also
reach out to local media and offer your expertise.
Make as many local media contacts
as you can and be extremely responsive with their requests. This can lead to
them to branding you as the local authority, generating plenty of free press
for your business.
3. Build up sweat equity
When I first started my business
I worked around the clock, handling every aspect of the business as well as the
marketing and growth. All of the hard work and long days that you put in isn’t
You are building a brand and your
hard work is essentially increasing the value of your business. Your sweat
equity will come into play if you ever decide to sell off a piece of your
company or take on a partner.
4. Make sure your receivables policy won’t sink you
If your business is a retail
operation then this isn’t going to apply, but if you are providing services
such as consulting or products to retailers you need to make sure that your
payment policy is well thought out.
Can you remain above water with
net-15 or net-30 terms? Don’t base your receivables on what you think your
customers will want. Base them on what is going to make your business operate
5. Don’t get buried in credit card debt
There is a smart way and a
suicidal way to use credit when starting a business. New computers, office
furniture, phones and supplies can all quickly add up. Instead of purchasing everything
at once and throwing it all on a credit card, use your company’s revenue to
finance your expenses.
Eliminating the stress and burden
of debt will greatly increase the chances of creating a successful business.
6. Avoid unnecessary expenses
You are going to have plenty of
expenses, and there are some that just can’t be avoided. What you can avoid
though is overspending.
Take something as simple as
business cards. You could drop R1,000 on 500 metal business cards that give off
the ‘cool’ factor, or you could spend R100 on 500 traditional business cards.
Being frugal in the beginning can be the difference between success and a
7. Tell everyone you know what you are doing
Inform your family, friends,
business contacts and past colleagues about your new business. Call, send
emails and make your new venture known on your social-media profiles.
Your friends and family members
can help you spread the word, and past business contacts can introduce your
brand to their professional contacts as well. This type of grassroots marketing
can help introduce your company to a much larger audience.
8. Build your business around what you know
Instead of venturing off into uncharted
territory, make sure that you build your business around your skills and
knowledge. The less you have to rely on outside sources the better. When your
business is built around your own personal expertise you can eliminate
consultants and outside assistance.
Also, having that knowledge is sometimes all
that is needed to successfully take the plunge into entrepreneurship.
This article originally appeared