How to start a business with no money

We don’t even have to explain why we decided to investigate the subject. There are many Chileans who are having a very bad time in economic terms and, at a time when even the resources to make the pot work are scarce, it is difficult to think of an initial investment to undertake. Therefore, alternatives must be proposed.

We hope to be of help.

1. Start with what you have

At the beginning of looking to start a new business, you should take stock of what you have at your disposal. Considers:

Skills: what can you do?
Experience: what have you done in the past?
Knowledge: what do you know?
tangible resources: What do you own and what do you have access to?

It is recommended that you think carefully about your answers to these questions. Go beyond what immediately comes to mind and think a little deeper about what you have at your disposal. In this process, be sure to write down your answers to these questions.

Your written responses will create a collection of artifacts and possibilities that can be combined to create something interesting, novel, and valuable for building a new business.

2. Be aware of who you know

What you have must be combined with who you know for it to have real power. Take stock of the relationships you have with others, map out your network of connections, and consider how your connections might allow you to use what you have more effectively.

Alternative means of business creation advocate «join partnerships to create new markets». Relationships, particularly partnerships, drive the shape and trajectory of a new business.

3. Invest what you can afford to lose

There is a big difference in your way of thinking if you start with the perspective that «I am investing this amount and expect a return of 30%» versus «I can afford to lose that much, so I’m going to put it in business and see if I can make it work.»

If you have only invested what you can afford to lose, you maintain flexibility in the business and minimize stress on your management. If you’re only willing to invest when you expect a specific return, there’s a good chance you’ll never make the leap and launch the business you’ve always dreamed of having.

An example of this is the entrepreneur who refuses to leave a high-paying job until he finds an opportunity that predicts it will pay moreversus one who decides to invest a small portion of their savings and two years of their life in a project that she or he believes is worth that amount of time and money, regardless of whether you will pay more than you currently earn.

That means living the alternative business mindset.

4. Experiment and adapt

With this mindset, flexibility and adaptability are a competitive advantage. Success is not achieved by becoming overly obsessed with a single goal or outcome, but responding to changes in the environment.

Existing businesses often take longer to adapt than new businesses because they have more incentive to keep things the same and have established routines and practices that reinforce the status quo.

New businesses are not tied to the way «things have always been done» and therefore entrepreneurs can benefit from changes in consumer preferences or changes in technology or changes in legislation by realigning their businesses to take advantage of such developments.

The entrepreneur or the entrepreneur with the alternative mentality, «In contrast, it has to be ready to deal with whatever comes its way and learn to transform positive and negative contingencies into useful components of new opportunities.»

Types of new businesses to start with limited capital

Businesses that emerge when entrepreneurs have limited capital and adopt an alternative mindset to start-ups often have certain characteristics. They often fall into one or more of the following general categories: Service, Events, Performance, Brokerage or Education.

Service businesses depend on the skill and time of the person starting the business. Such a person can make their skills available to others with a relatively small initial investment. To start a service business, you simply need the tools of your trade.

A consultant may require a computer, a builder some tools, and a seamstress a sewing machine. With these tools in hand, you can use your contacts to start selling your service.

Event-based businesses are a bit more complex, but can still be started with limited capital. The advantage of these businesses is that with effective marketing, and a good internet connection, you can sell the tickets before incurring the higher costs, which limits the amount of capital needed to keep the business afloat and, due to the distance social, today all events are streamed so there is no need to invest in security, stages or complex audio and amplification systems.

Performance-based businesses depend on the ability of entrepreneurs to perform and bring together other people who can improve performance.

Mark Lamberti, the entrepreneur who made Makro what it is today, says he learned some of his most important business lessons when he played and led a band in his youth.

performance-based business they depend on the creative ability of the entrepreneur coupled with the ability to market those skills to a broader audience.

Musicians, comedians, motivational speakers, and singers they have the potential to create performance-based businesses.

Brokerage firms are among the most popular types of businesses for people with little capital. They bring buyers and sellers together. It finds brokers in multiple industries, from real estate (eg, real estate agents), hospitality (eg, website portals that market B&Bs) though that should be put off until there is a proven and effective vaccine; recruitment (for example, recruiting agents) and sports (for example, sports agents who bring together athletes and sponsors), to speakers and artists. (for example, speech agents who market speakers to conference coordinators) and the list goes on.

The key to being effective at brokerage firms is networking and nurturing relationships and effective marketing on both sides of the equation: with buyers and sellers.

But the essence of the business remains what it has always been: fill an information gap between buyers and sellers. People with many contacts in a particular industry and a knack for marketing and sales should consider a brokerage business as a low-capital way to get into business.

Education is another area where people find opportunities with little or no capital. Anyone with skills and knowledge that others want to learn, and a passion for helping others develop, could enter education.

From an ex-teacher building a business providing extra lessons for kids going to school, or a sports fanatic building a coaching business, to a person with photography training helping others take better pictures , Multiple low capital opportunities exist in the education arena.

While these five business categories (service, events, performance, brokerage or education) can spark some ideas in your head, low capital start-up opportunities are not limited to these.

With the continuous development of technology, many new opportunities are emerging in the software and web services space (eg, creating iPhone applications) and in the media space (eg, with blogging tools and websites, it is no longer necessary to spend 5 million rand to create the foundations of a media company).

The key is to start with what you currently have — the resources you can access, the skills you can tap into, and the connections at your disposal — to help you find a low-cost path to a sustainable and profitable new business.

The Downside of the Low Capital Approach

Although there are many benefits to beginning your entrepreneurial journey by asking «what do I have and who do I know?» There are also disadvantages to this approach that may require corrective action to overcome negative consequences.

The main one centers on the notion that the company and the owner are inextricably linked: the owner is the company and the company is the owner. Under such circumstances, it becomes difficult to scale the business because the owner only has limited hours a day to continue selling their services.

It is also difficult to sell the business because worth very little without the owner and there is a risk that the owner is exhausted (One tends to be an exploiter and a slave to oneself).

To overcome these challenges, entrepreneurship needs to focus on codifying what you do and training others to replicate it. You should also aim to systematize the business as much as possible, creating systems and processes to do and control what is done.

America’s Big Four Accounting Firms began many, many years ago as small accounting firms, but were able to grow because senior partners effectively trained juniors coming into the firm in effective accounting and auditing forms and created methodologies and practices. that could be passed from one person to another to enable a broader base of people to do the required work.

Although there is a downside to the alternative approach to entrepreneurship, there are also many advantages.

It’s empowering to focus on what you can do with what you have at your disposal and it enables people to get into the business. in ways they otherwise would not have imagined. If you are serious about building a business with a low capital base, we encourage you to give it a try.