Hard To Make Real Money In Business Without Own Company

Another way to make money in real estate investing without using any of your own money is through assignments. It's not a complicated process, but it does require that you have your buyer lined up before you lock yourself into a purchase contract. You're going to actually make your own deal with the seller and write up a purchase contract. There are a lot of simple service businesses that you can start with no money. You can grow them at your own pace into a highly profitable business. Plus you don’t need experience for many of them. For example I started my house painting business without any house painting experience.

It's 2021, everyone wants to start a business. Don't you have much $$ to do it? Don't worry - in this article, we will learn how to start a business with no money.

You’re probably thinking about your rent or mortgage, your car payment, and every dang insurance you have to have on top of your other bills; and at the end of the day, you have about $41.78. You think, “how am I supposed to start a business with that?”

Well, you are in good company. I started this site with $41.00, so you are actually better off than some. I am currently making +$2,500/month, which might not be a lot for some, but it is great as a passive income.

Throughout this loooong article, I will be teaching you how to overcome each business stage without a penny while sharing my personal experience doing it, share some ideas that you can start without much money, particularly of online businesses, and recommend you some tips and considerations you may want to take throughout the process.

What motivated me to write this post was recently receiving a message in the chatbot down in the corner that said: “I want to start a small business but have no money”. So that’s when I asked myself...

How much money do you need to start a business?

If you google this same question, you’ll probably come across an article from the US Small Business Administration that claims that the average cost of starting a micro business is $3,000.

Hard To Make Real Money In Business Without Own Company Images

However, this is quite a controversial and difficult topic to talk about. In the end, starting a business can cost from $0 to millions of dollars, as it depends 100% on the industry you want to operate in, the idea you have had, your knowledge and experience in the field, etc.

The only cost of starting a business that can really be calculated is the cost of forming an LLC, C-Corporation, or whatever kind of legal form you decide to go with. That will depend on which city and country you’re starting the business in. The costs of forming an LLC in the US can go from $500 in Massachusets to $40 in Kentucky.

Another thing that’s important to understand, when doing this analysis of how much does it cost to start a business, are the different types of costs that exist. We will divide them into three categories:

• Fixed vs. variable costs: Rent, employee’s wages, and insurances are 3 examples of fixed costs, those that you’ll have to pay even if your business’s doors are closed. Materials, transaction fees, and bonuses are variables costs, those that depend on how many goods and services your business produces every month. As the business grows, fixed costs begin to represent a smaller part of the business’s revenues, while variable costs increase.
• One-time vs. ongoing costs: One-time payments can be significant at the beginning as you’ll need to form the business, acquire machinery, prepare the working space. Ongoing costs are those that need to be paid on a regular basis - they generally increase as time goes on.
• Essential vs. optional costs: Essential costs are absolutely necessary for the survival, growth, and development of the company. Optional purchases, in contrast, are those made only if there’s a surplus of revenues. They generally involve experiments and risky decisions that may not bring any ROI (return on the investment).

Knowing these kinds of costs will be essential at the moment of doing an estimate of how much will starting your business cost. For you to have a better idea, here’s what the US Census Data estimate for different industries:

• Administrative services: $11,000
• Construction: $14,000
• Professional & technical services: $14,000-$18,000
• Healthcare services: $27,000
• Retail: $32,000
• Finance: $52,000
• Real Estate: $75,000
• Restaurants: $125,000

This sounds demotivating, right? We claim we were going to build a business with $0 and now find out that the cheapest business to start costs an average of $11k. But that’s just an average and only on a few industries.

The internet has democratized a lot the business world, reducing the costs of starting a business to $0 or almost $0. Someone who can code can easily purchase a domain and hosting for less than $30 and build a site that makes thousands per month.

A great example of this is Alex Tew who, at his 21 years, built a digital billboard that sold 1 pixel for $1. It contained one million pixels and selling them all only took him 4 months, at probably $0 costs.

Feel a little bit more motivated now, right? Let’s get into the interesting part. We will be analyzing how you can go over each stage of businesses without spending any money, from research and coming with an idea, to launching and growing it. In each stage, we will share the details of how we did it with this website called Failory.

Facing the Business Stages with no Money

You MUST Research!

The first and possibly most important step of starting a business is to research different markets & customers (or if already have an idea, which is step #2, just research that market).

There is probably no other better resource to learn how to do this properly than in the following video. It's quite long, I know, but it's amazing. You will learn in real-time how Ramit Sethi, a really successful entrepreneur who has sold +12,000 products to hundreds of customers, carries out market research for new businesses.

Eric Ries from Lean Startup recommends asking for feedback as early on as possible. Getting this feedback can come in millions of different ways, from offline surveys to video calls with your target buyer personas. You may want to experiment to find out what’s the fastest and cheapest way to get this feedback while keeping it high-quality and relevant to your business.

Validating your idea is the most essential part, particularly when starting with no money. Many startups fail because they build something no one is interested in. That’s what you need to avoid at all costs. If you aren’t sure where to start, reach out to other businesses and entrepreneurs. Their insight is priceless. Some ways to do this are meetups and Linkedin.

Another interesting thing to do is to research tools. When starting a business, you will probably need many tools and software to build it and sell it. But you don't have a huge budget to pay for them, so a great solution is to find free alternatives.

There really is no need to reinvent the wheel. If you have a general idea about a tool you wish you had or existed, Google it. Seriously, Google exactly what you’re thinking. Google “Top Ten…” and you can even add “Free” in the search and find out which ones are similar.

If you’re starting a business from scratch with no money, then you’re probably pretty creative and clever. Use that creativity in your research to find what best suits your needs and budget.

There are plenty of free tools for everything and don’t be afraid to test out the FREE TRIALS. You can always cancel it. #protip: set a calendar notification to cancel it so you don’t forget and get charged.

If you can think it, it’s probably already out there (and if it’s not, make it and sell it).

A few weeks ago, I needed to schedule some content for social networks. But I didn't want to spend some money on Buffer or Hootsuite. That's why I started googling and found a free solution using Google Calendar and IFTTT. I now basically create an event, set a description which is used as the post text, add a hashtag in the title depending on the network I want that post to be published in, and set up a date and time I want that post to live.

A third thing that’s useful to research is other startups.

We don’t share success and failure startup stories on Failory for fun; we do it for you! Researching and reading about other startups (even in unrelated fields) will help you learn how to start a business without money because you will see what worked and what didn’t.

Researching other startups, more specifically in your field, will better help you determine how much money you may need to start your business, what are some things that work and what don’t, what you may need to avoid, etc

You can also learn about potential suppliers, vendors, customers, and competitors. Learning about suppliers, vendors, and customers will help guide your product. Learning about your competitor will help you learn how to shape your marketing and business strategy.

Plenty of people have brilliant business ideas and great products, but it isn’t always the best that succeeds. That’s why you need to be filled with knowledge. In any industry, a lack of knowledge will truly eat you up, so keep learning. Knowledge really is power, it isn’t just a cheesy phrase!

Researching & Learning Before Failory

The research I did before starting this site is a great example of all the things I’ve mentioned.

Before doing it, I had spent many months reading about startups, media businesses, communities, content marketing, etc. I was a big fan (and still am) of Indie Hackers where lots of successful business founders were interviewed every week, which was super inspirational and a great source of lessons and strategies.

At the same time, I remember taking every free online business course I found. I formed part of Facebook groups like “Udemy free courses” and Telegram channels that shared discounts. I even registered on Udacity and Coursera for their free trials, took the courses super fast and removed the credit card before it was billed.

On the side, I was also constantly trying new tools and products, as I have always been a fan of Product Hunt, a site where new startups and products are launched. As I was really limited in the amount of money I could invest, I would always search for trials, demos and discounts that would enable me to use these products at a fraction of the cost.

That’s how at the moment of building the site and lacking of coding experience, I was able to get a 3-month-free deal on Webflow, a visual web design tool, and a cheap domain and hosting plan.

With just $40, I was able to educate myself in a series of business areas as well as build a functional product that would later on bring thousands of users.

Coming with a Great Idea

Coming with a great idea is essential in order to start a business without money.

You need to know exactly what your idea is and how much you are going to need to start things up. Don’t just go out and get a huge loan; you might not need it. That’s why research is the first step.

Your idea should be refined; it should be specific and clear. What I mean is, test it out and get feedback. We have already talked about feedback... the main idea is to see how practical your theoretical product or service is.

The way I generally come with new ideas is to think issues people are facing. You need to solve an existing and real pain; that’s where people will be more willing to put money in.

Another strategy I generally use is to identify some profitable and fast-growing businesses and adapt them to other niches.

Something you may want for your idea is to have product-market-founder-fit. What’s this?

• Product-fit refers to the product you will offer to your customers.
• Market-fit refers to the problem you aim to solve with your business idea.
• Founder-fit refers to your interest around that business. Lack of motivation is a common cause of failure for many startups. Your reason for starting a business can’t be just to make money.

The fit of these three means that you have came with a product that offers a great solution to an issue, problem, or pain many people are suffering, and at the same time, you’re interested in the solution you’ve built and market you’re providing it to.

Here’s a great and inspirational video from Dan Martell on 9 strategies to come up with winning business ideas:

If you carry out all of the mentioned strategies so far, you should be able to come up with a big list of business ideas. Just brainstorm for now, then you can do deeper research and remove the ones that you don’t think it will work or don’t work with the product-market-founder fit framework explained above.

What I generally do with new ideas is to store them on a spreadsheet with 9 columns:

• Idea: I explain the idea in a few words.
• Details: I provide deeper details on that idea, the market it would serve, the problem it aims to solve, how will the solution work, etc.
• Domain: I brainstorm some ideas and check if their domains are available.
• Team: I think whether I could work on that business on my own or would need to co-found it / hire someone to do some tasks.
• MVP hours: I estimate how many hours will it take me to build a really basic product for that idea which aims to validate the demand. Will now get deeper into this.
• Investment: I approximately estimate how much will it cost me to set up the MVP along with what are those costs.
• Price: I select some pricing for that idea based on my gut feeling - no competitor/market analysis yet, there will be time for that.
• Revenue/month: I estimate whether this is an idea that can bring some hundreds per month, some thousands, or some amount that would deserve working on the idea full-time. I generally just write $, $$ or $$$.
• Expenses/month: I estimate what will it be the main costs of keeping the business active in order to easily discard those that have low revenue estimations but high expenses calculations.

Such a spreadsheet can help you identify which idea to work in, based on the resources, time and team you have. If you want to have an idea storage like this, just duplicate this spreadsheet.

Okay, I have a spreadsheet full of ideas, now what? It’s time to select one and validate it.

Validation of the idea, as already explained, is essential so as to avoid spending time and money on a product no one cares about. A great way to do it is to build an MVP of the business idea you have.

If you take away only three things from this article I hope that this is one of them.

MVP, which stands for Minimal Viable Product, is a product on a basic level that is valuable and works. You can always add more features and spend time perfecting it, but get it out the door if it is good. Your product may not need all the add-ons.

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The main purpose of an MVP is to get feedback about what people really want. It will help you decide whether there is real interest in that product, what features need to be built firstly, what do your customers struggle with the most, etc.

How I Came with Failory’s Idea

As I’ve said, I was a big fan of Indie Hackers, where successful entrepreneurs were interviewed. Courtland, Indie Hackers’ founder, was transparent with the numbers of the business and he even shared articles on what he was doing to grow the site.

That’s how I applied the strategy mentioned above of copying Indie Hackers’ business model and adapting it to another niche. I knew that a huge percentage of startups failed but Indie Hackers wasn’t showing those stories. That’s what Failory would do.

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Once I had the idea, I needed validation. That’s how I built a website in less than 2 weeks, filled it with 9 interviews and launched in on some communities. In the first week, it received +10k visits, which made me realized I should keep working on it.