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Entrepreneurs
will often have amazing business ideas, but they put them on hold due
to a lack of capital. They assume that their idea will never get far off
the ground unless they have major funding behind them.
It
seems that every day there is a new startup receiving millions of
dollars from venture capital firms, but what you don’t hear about is the
several startup failures that burn through millions of dollars only to
fizzle out and shut their doors forever.
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. Have a great
idea but very little money? 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.
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.
2.
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.
3.
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 $1,000 on 500 metal business cards that give off the “cool” factor,
or you could spend $10 on 500 traditional business cards. Being frugal
in the beginning can be the difference between success and a failed
business.
4.
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.
5.
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 successfully.
6.
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 for nothing. 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.
7.
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.
8.
Get ready to hustle. 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
success. 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 entrepreneurship.
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