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How to start a business with no money

Three out of every five Americans have a business idea, and more than a third come up with multiple ideas. But when it comes to turning those ideas into reality, 63% of Americans don’t follow through.

Three out of every five Americans have a business idea, and more than a third come up with multiple ideas. But when it comes to turning those ideas into reality, 63% of Americans don’t follow through.

One of the biggest reasons is the lack of funds.

We were conditioned to believe that starting a business takes wads of cash. And to be honest, just 20 years ago, that was the truth.

However, in 2022, there are ways to sidestep the lack of funds and start your business from scratch.

In this guide, we will explore those ways so that lack of funding can’t hurt your entrepreneurial dreams ever.

Let’s get started.

How to start a business with no money

Before discussing the right ways to start a business with almost no money, let’s talk about some prerequisites.

First of all, don’t leave your day job to pursue your entrepreneurial dreams at the get go. The idea of leaving your 9-5 to start a business gets a lot of approval on social media, but you can certainly take care of business on weekends when it’s in its infancy. If anything, your job can fund your business and help it grow.

Secondly, be prepared to spend a lot of energy learning new things. You will be taking care of almost everything from product development to marketing and finance, so having a decent idea of everything helps.

With these out of the way, let’s discuss ways to build your business from scratch with minimal investment.

Focus on ideas that require little investment upfront

All business ideas are not the same. Some require a significant investment right at the beginning (and often yield high ROI), while others might require a little (though ROI can be very high too).

Ideally, you want to focus on the 2nd category – businesses that don’t need a lot of investment, and are easy to start. Usually, services and some online business ideas fall under here. Let’s shed some light on the most popular ones.

  1. Sell your services

Selling your services is the cheapest way to start a profitable business. Even if your skills are just above average, you can still get paid for helping others.

The most profitable and in-demand skills are

  • Copywriting
  • Coding
  • Website development
  • Social media marketer
  • Virtual Assistant

In Sep 2022 alone, 425,741 businesses opened their doors in the US. So there will be no shortage of people who need to get a few blogs written, websites designed, and their social media pages managed. And many of these service-based entrepreneurs can hit the 6 figures pretty consistently.

A service-based business can still be a great option even if you don’t have any in-demand skills yet. Remember, people want to save time and don’t enjoy carrying out certain day-to-day responsibilities. You can do those on their behalf as a service. Here are some examples:

  • Window cleaning
  • Dog Walking
  • Lawn mowing

Such offline service-based businesses often generate surprisingly impressive revenues. For instance, this window cleaner made $250,000 in a year.

  1. Dropshipping

If you are unfamiliar with the term, dropshipping is a business model that requires you to have a seller website for listing various products. However, you don’t need to keep the inventory. Instead, when someone places an order, you get your supplier to deliver the product on your behalf. Then you just pay the supplier and keep the profit.

Dropshipping is very popular among young, internet-savvy, and low-budget entrepreneurs. That’s no surprise, as your cost involves only an e-commerce website and some promotional expenses. However, don’t let the relatively low profile of this business fool you. Even college students can make over $200k in 3 months with dropshipping business.

  1. Print on demand

Personalized gifts and clothes are a popular form of self-expression. That’s why such gifts are in-demand worldwide, which explains the size of the global personalized market reaching $43.3 B by $2027.

In a print-on-demand business, you sell personalized items (mostly custom prints) on your e-commerce website. In a way, this business model resembles its dropshipping counterpart. You start with a website and are responsible only for the marketing. Brands like Printfy and Printful will print the designs onto inventories, ship them to the customers and charge you after you receive payment from your customers. So essentially, these brands act like dropshipping suppliers who not only maintain the inventory and ship your orders but also assist you by printing personalized prints on the to-be-sold items.

The profit margin of print-on-demand businesses is comparable to that of dropshipping businesses.

  1. Sell digital products

Selling digital products like ebooks and courses can be a great low-investment business idea. After all, it takes nothing except an internet connection and a working laptop.

To start this business, first, you need to figure out which skills and topics you want to leverage. Follow it up with detailed customer research to find out your target customers and what they are looking for. Only after these two steps you would be in the right position to start producing your digital products, such as

  • Ebook
  • Courses
  • Templates

The best part of this business model is that digital products are scalable. You can create it once and keep selling it for years, which means the ROI of selling digital products is high.

In order to sell your digital products, you can either go for third-party platforms or use your website. Usually, third-party platforms do marketing on your behalf, which makes those platforms lucrative to many.

On the flip side, you get 100% of sales revenue if you sell your products on your website. So it boils down to what is more important to you. If you don’t want the trouble of promoting your content, use platforms like Udemy. Alternatively, if you have decent traffic, sell via your website.

Piggyback on what you have

If you start with a tiny budget, you need to utilize every resource at your disposal and sometimes even get creative. So every business decision of yours should be centered around resource optimization.

For starters, you can consider starting a business that requires a skill/ tools that you already have. Of course, you can learn something new and then start the business. However, your business will take more time to become profitable in that case as the learning curve is longer.

So take a hard look at the potential business ideas. Pick the one that closely matches your skills and resources.

You also want to tap into others’ skills and experiences. If you can find an entrepreneur with enough experience in running a similar business, ask them for advice. You can spot and evade many strategic, operational, and financial mistakes with their guidance.

Seeking the expertise of your loved ones is also fair game. Do you have a friend or family member who has copywriting or marketing skills? You can request them to assist you (don’t forget to compensate them for their time once your business is in good shape, though).

Licenses for essential online tools can significantly increase your expenses. So look for free, open source, or cheaper alternatives. For example, you can use Photopea instead of photoshop or Google keyword planner instead of other paid tools.

Long story short, use your available resources to avoid costs and mistakes that would spread your small budget thin.

Do your market research

Many new entrepreneurs just vaguely learn what worked for their immediate competitors and organize their business operations and marketing plans based on that information.

Not the smartest decision at all!

This “throwing spaghetti on the wall, and seeing what sticks” approach is bad for several reasons.

First, you might completely miss hidden competitors and dry up your resources just to compete against immediate ones. For instance, you might offer a better price compared to other online sellers, but your target customers might prefer to buy from local brick-and-mortar stores.

Second, you might spend your budget on a strategy that’s unsuitable for you. If you just started your freelance writing business, you may not get much traction if you start uploading videos right from day 1 just because it worked for a top-level freelancer. In that case, you would be better off publishing a few samples and reaching out to potential clients.

Third, you might miss what the audience truly wants. For example, you might focus too much on discounts when your customers actually want assurance of quality and fast delivery.

The best way to counter these challenges is to conduct market research.

You want to start by collecting info about your audience. Search on the internet and comb through relevant forums to understand your customers’ expectations, habits and challenges. However, interviewing a bunch of them is the best way. If done right, you will receive excellent quality insight that will help you attract and satisfy your customers in the long run. If you can find mentors, you may even learn about some peculiar aspects of customer behaviors that are often hard to spot beforehand.

For competitive research, Google is your friend. Take time to understand how your competitors do marketing and resolve customer complaints. Pay attention to the ways competitors are failing to match customers’ expectations.

In the case of offline service-based businesses, gather information on competitors from those who paid for their services. You can even try their services yourself to understand them better.

Once you complete your market research, use it as the base of any business decision you take.

Validate your ideas

Your business idea might look amazing on paper, but you will meet some frustrating challenges after launching your business. Some of these challenges may be trivial. Others can severely impact your profitability and the overall survival of your business.

Take this example: After the launch, you realize that despite retaining your repeat customers, the average time gap between two recurring purchases is so long that your cash flow suffers. Since you are caught off guard, you don’t have enough leads either to fix the situation.

There is only one way to address such unwanted situations:Validate your ideas.

You can validate your ideas with pre-orders. Pre-ordering works by collecting payments for orders or services that haven’t been delivered/provided yet. You can create hype on social media or use offline methods (flyers, for example) to create demand first. If you execute the previous steps right, you shouldn’t have trouble getting pre-orders.

Also, dropshipping entrepreneurs should start with a small number of orders before committing to specific suppliers. A few order deliveries will reveal what challenges you might face in the future.

Prepare to wear many hats and Minimize your spending

When it comes to building a business, time and resources are inversely proportional. In other words, you have to invest more time if you have less money to spend and vice versa.

So, if you have a 9-5 job background, prepare for a shock: Juggling so many responsibilities would be overwhelming. Unlike your day job, here you will be playing the role of an accountant, a marketer, a copywriter, and a strategist until you can afford to hire freelancers or employees.

On a positive note, various challenges, with no solution in sight, will push you to master new skills and mindsets. These learnings will help you grow your business and lead your team in the future.

Nonetheless, the faster you can make peace with your new reality, the sooner you will achieve the right mindset.

Also, you should aim to slim down your expenses as much as possible. Being a “One-man army,” in fact, is a part of your cost-cutting efforts. There are other ways to achieve the goal.

  • Be it online or offline, don't rent a space if you can run your business from home. By working from home, you can get rid of a massive overhead.
  • Penalties for missing taxes can be hefty. So stay err on the side of caution and file your taxes within the deadline.
  • Find cheaper alternatives for the necessary tools. For example, you can use Wix or Weebly to build your website. For project management, you have free options like slack.
  • Rent or purchase used equipment from Craigslist and eBay. Alternatively, you can request your friends to borrow their used pieces of equipment.

Explore different funding options

After you launch your business with very tight funds, you will eventually reach a point where you will need more funds to grow. Ideally, you want to reinvest your profits into your business. However, things often don’t follow a straight line in real life, and you may have to go for other funding options.

  • Funds from family and friends: You can ask your friends and family to fund your business. In return, you can offer them a small equity stake or a larger payment after your business becomes profitable. It’s a relatively easy way to raise funds, provided your friends and family have enough resources.
  • Crowdfunding: The term crowdfunding refers to the practice of raising funds by receiving small amounts of payment from a large number of people. Crowdfunding is a great option if you don’t want to involve investors. To start your crowdfunding campaign, you need to get on the platforms like Kickstarter, Crowfinder, and SeedInvest. Here is a great example of a small business raising money via crowdfunding.
  • Grants: Grants are one-off lump sums given to small businesses without any need to pay them back. But there is a catch: Grants are usually given to innovative and functional small businesses once or twice a year. So grants are basically “nice to have”s. But don’t depend on these if you need immediate funding.

Nonetheless, grants are worth your attention. Here is a list of 63 grant programs for US-based small businesses for your future reference.


No matter what business you start, you want to keep a tab on its financial health and profitability. Right at the beginning, you may have to play the part of a bookkeeper for your business.

However, after some growth, you will be at the crossroad where you start looking for a bookkeeping service. One option is hiring a freelance bookkeeper and spending hundreds of dollars monthly( which you should invest in other areas). Alternatively, you can invest in Fincent.

This bookkeeping tool keeps track of every inward and outward transaction. With a few clicks, you can see your sales figures and expenses. Feel free to use those to determine your cash flow, net sales, and other yardsticks.

For more info, book a demo here.

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