“Where is my startup capital?” That is the question that bursts most business bubbles 🙁
Most of us dream of being our own bosses, wearing our desired style to work or maybe even working from home in our pajamas. But this one stone seems to trip us over.
Here, we are going to explore together just how you can pull some strings here and there and get that enterprise of yours up and running. Who knows I might be talking to the next Bill Gates or Steve Jobs, so please listen up!
Oops, where are my manners? We can’t go on with the show without first congratulating you for coming up with your business idea. Let nobody tell you it’s easy coming up with something of your own because it is not easy at all. Thumbs up entrepreneur!
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PEOPLE WHO MADE IT WITH LITTLE OR NO CAPITAL
Now let’s get down to business. There is no better way to get some excitement pumped into you than to give you some real-time examples of people who were exactly where you are today.
People who had no startup capital, maybe a few dollars and cents in their pockets but with a pinch of some entrepreneurial creativity managed to turn that anthill into a mountain. People who even when compared to you, were a little disadvantaged!
- Steve Jobs and Steve Wozniak.
Never knew they had similar first names. But I do know that they are founders of Apple Inc. One of the biggest computer systems in the world today. But did you know that they first started out in a garage owned by Job’s parents? Jobs had to later leave university to focus on his business full-time. And at one point they even had to look for a co-signer to secure a loan for $250,000?
- John Paul DeJoria.
Not a name you might be familiar with but I am sure you will be interested if I told you that his current worth is $3.1billion. But was he always like this? No, in fact, he once lived in his car when he was starting out on his business. He worked as a newspaper courier and even as a janitor. But with a starting investment of $700, he started out John Paul Mitchell Systems.
- Michael Dell.
We have all seen or used the Dell computers and we love them! At least I do. But do you know that Michael first started this company with just $1000 investment from his family? And I just can’t express how much it has grown to date.
WHERE IS THE STARTUP CAPITAL?
Let’s get our neurons to work and have a look at some key points from these guys. Firstly, Debt as bad as it may sound could be a key way to business success.
Secondly, you are your greatest investment, now I cannot emphasize enough on this, all these people needed the knowledge, skills, and education to create the masterpiece that the world fell in love with, so read as many books as you can on topics that you are interested in businesswise.
Third, march on tomorrow, get rid of the ‘it has always been done this way’ mentality, crack your way out of that egg and venture into new unexploited markets.
You have the Idea and business plan but now you came here so that you can know how you can get capital to establish that business, throw money in the air and start swaying your hips in joy. But hold up! You’ve got to be willing to start small but visualize it big. Here, take a look.
- Creative Means.
You didn’t come here for the traditional ways and these are definitely not textbook methods you learn in business class.
- Off-book Services.
What I am talking about here are the skills that you are able to offer to customers that aren’t necessarily what you signed up to provide through your business. But you do this to create some cash flow and get some startup investment for your business. This can be done both at the individual or company level.
At the individual level am not talking about being a janitor like John DeJoria. Remember we talked about reading to invest in yourself? Here is where this applies.
With some newly learned skills, you can earn some capital for your business. Be a freelancer! Write some articles, do some website building, social media management, sell some photography, create some logos or some data entry work. It might not sound like much but joining some freelance platforms like Upwork is absolutely free and within some weeks you might have enough to start on something of your own.
At the company level, let’s say you have your startup running but not yet in full speed ahead and you want to stand among the great. Reach out to your employees. Get some employees who are willing to offer extra services.
For example, get your marketing department to create websites for some clients to earn some extra cash or your management department can do some data entry or project management. It’s like creating mini-companies from your business that would generate revenue for the main business and embark on it once you have enough capital.
As the name suggests, this is all about you tightening your belt and seeing just where you can get some capital for your business.
Personal Savings:- Time to break the piggy bank. Whether it is a dollar you have been saving every day, it will help. The good thing here is that there is no liability or interest charged.
Retirement:- Yes maybe you have just rounded off your 30 years of service or maybe it’s just the three-year savings you accumulated while employed, you don’t have to be 60 to retire. Learn how to use your 401K retirement savings to start your new business
Personal Credit:- Most of us starting entrepreneurs have more access to credit than cash. What I would advise you is to limit your credit card spending to a specific revenue generating source. Your customer then pays you and you quickly maintain your credit score.
Home equity Loans:- These can be quite risky as you now put your home as the collateral for the credit you receive.
Friends & Family:- Michael Dell did it and you can get some investment for your business from here too. Plus it’s less risky. Of course, you’ll have to pay for the loans you receive.
Yeah, I know. You had a hunch I was going to mention these guys but am going to do more than just spill the options. Am going to give you some little bit of knowledge you may not know.
Firstly, I should tell you that banks are reluctant when it comes to funding startups. Especially when you have no commercial assets they can claim as security. Here’s how you can get around this barrier.
- Term loans for machinery:- Get a loan you will use to purchase fixed-value assets. Voila! You’ve got fixed assets.
- Loans for research and development:- This is one way you can get their eyebrows raised and have them more interested in your business. Just prove to them that you are able to create some potentially profitable merchandise.
- Customers & Suppliers.
But how? Aren’t we talking about just how you can get your business started? Relax. Am going to show you how to start your business with almost no investment, except for your idea of course.
- Product licensing:- You probably won’t like this but this is better than just sitting on gold then some years down the line some guy thinks of it and gets rich. Yes, you don’t have the ability or money but there are similar businesses out there that have. But DO NOT try this tactic without guidance from consulting experts.
- Customer orders:- If your product is so unique that customers just can’t wait. This is where you get customers to prepay for products before production. It is hard to negotiate but if you’ve got sweet business words what’s stopping you?!
To join the entrepreneurs’ club, you have what I believe to the most important quality is persistence. I mean, Steve Jobs, Michael Dell and Bill Gates dropped out of university to pursue their dreams. No, I don’t mean you leave school. What am talking about here is you have to have the drive that will convince people to believe in your dream. You need this here.
- Venture Capital:- There are companies out there that will be willing to inject some capital to your business and share capital.
- Angel Investors:- Take a look at the TV Show Shark Tank. This is where wealthy individuals or families invest in your business for a percentage of the profit.
Both these two methods as juicy as they sound are actually quite hard to pin down. You might have to get in the trench, knock on some doors and get some doors shut in your face. But as I said earlier this path isn’t easy and you must be willing to play hard.
Bottom line here is to not let your current financial status hold you back from your entrepreneurial dreams.
This is your dream and nobody has the right to stop you if you believe in it. Of course, you may want to do some creative thinking and work in between but at the end of the day, if you keep on pushing, one door will open and there will be no stopping you now. Good luck entrepreneur!