6 Ways To Start A Business With Little To No Money

Here's how you can turn an idea into a company without tons of funds.

Workin' Girl

There's always talk about entrepreneurship and how it can be the key to making your financial dreams come true, but there often isn't as much talk about the sacrifices—especially those that hit your pockets hard—required to get a business off the ground, nevertheless keep it running. And maybe you've got a great idea, but when you're out there just trying to live a normal life, who can even think about taking money out of the I'm-barely-making-ends-meet account and putting it toward starting a business? Research even shows that one of the top reasons women don't start businesses is because of the startup costs required.

Well, we're not into discouraging our aspiring bosses out there. We're here to talk solutions for starting a business with little money. Here are a few ideas inspired by those who have done just that so you can get started on making your business vision a reality:

1. Start small and scale.

Getty Images

Sometimes that infamous quote, "Go big or go home," might not apply to startup costs. Take a nod from the founder of The Mane Choice who is now CEO of Olbali Corp. Courtney Adeleye started her line of haircare products by making the first product in her home, and she took advantage of free resources such as YouTube and Instagram to build her customer base. Within a few years, she was able to turn those small efforts into millions of dollars in sales and expansion into collections of products in stores likeTarget.

Get out of your own head and get into facts by reading up on what it truly costs to start your business and then calculate, based on your finances and lifestyle, what you can realistically afford to do.

For example, if you want to sell clothes, maybe start with one cache item, see how that sells, and then expand the line. Want to offer a service? Start with one niche that you can excel at, track the success, then pivot and change your strategy where necessary. Want a storefront? Try a mobile or online business first, build up your capital and customer base, and create a plan for saving up and financing for your grand opening at a later date.

2. Pool investors.

There are many ways to do this, but don't let that overwhelm you. (Also, don't be intimidated by the big-money talk or the multi-millionaire professionals who are the movers and shakers.) If you have a good product, prototype, brand, or idea, think strategically about who could invest in your launch and get in the game.

Angel investment organizations or firms are a good place to start (and there's a good list of those that support women- and minority-led startups here). Platforms created by women like Arielle Loren, founder of 100K Incubator, are also great resources for finding investors and networking with other entrepreneurs.

You'll want to weigh the pros and cons of taking on an investor to start up your venture. Getting money is great, but investors sometimes have authority over important aspects of your business including how the money is spent or even the name of your company. They might also, down the line, play a role in how you run your brand or even decide whether you remain as the leader at all.)

Another great option is crowdfunding or microfunding, where you use a platform like Kickstarter, present your business idea or project to the world, and raise funds via community investors.

Dawn Dickson, founder of Flat Out Heels and CEO of PopCom, was able to raise more than $1 million to launch and expand businesses via supporters in her community. Other entrepreneurs have used this method and raised funds even without having a physical product, gauging interest and building momentum via pre-sales, offers of equity, and prizes.

Oh, and don't overlook networks within your family, your school, your civic organizations, or your workplace. There might be someone less than six degrees of separation from you who is willing to invest just to gain a percentage in profits or ownership or to contribute to the greater good.

3. Get into a pitch competition.

Getty Images

Be inspired by the story of Stephanie Smith, founder of Digital Insomnia, who won $25,000 to put toward creating a digital marketing simulator prototype. Or the story of Range Beauty founder and CEO, Alicia Scott, who was able to take her brand from $300 to $300K by becoming a master of pitching her business. Organizations and businesses often sponsor pitch competitions that offer thousands of dollars in startup funds as prizes, and this is a great way to get that financial boost you need to start your business. Some even cover all expenses and offer additional support resources like mentors and tech tools.

Sharpen up those public speaking, marketing, and sales skills, sis, and make sure your business plan is a solid one. Invest in a coach, watch competitions online, or attend a few so you can hear common feedback from judges.

The better prepared you are, the more likely you'll come out the victor. (Oh, and of course, here's a great list of a few to start with. Yep, you're welcome.)

4. Outsource and partner up.

Any time you can split the costs of something, you save, so if you have a similar idea as someone else or you might be serving the same audience, why not partner up and pool resources? Malaika Jones, Nia Jones, and Tai Beauchamp, the three Spelman sisters who founded wellness brand Brown Girl Jane, are a great example of how combining talents and resources for launching a brand is more than smart.

Let's say you want to start a business building and selling phone apps. Well, maybe there's a tech professional in your network (or someone you could get to know through, well, networking) who wants out of the 9-to-5 life and has plans to transition into tech entrepreneurship. Pitch your idea and see where there might be common goals. Match their skills and network with yours and you might have a winning combo in which you can split the costs of bringing an idea to life.

Not too keen on partnering up and sharing profits? Many online vendors can handle certain aspects of getting your business off the ground in a more cost-effective way due to their level of experience or expertise. It might be a better idea, in the long run, to simply pay them a one-time fee to handle those areas.

Contacting a consultant with skills in coming up with cost-effective strategies for starting your business can sometimes save you money in the long run. LinkedIn is a great place to start to find other professionals and entrepreneurs to become partners or consultants, and nothing beats attending events and seminars (whether virtually or in person) where smart business-minded and successful folk congregate.

5. Try low-investment retail.

Getty Images

Just a disclaimer on this one: We're not talking about "easy" or "get-rich-quick" ways to start a business, and you'll want to be aware of all risks associated with these sorts of businesses (or any business, for that matter). That being said, dropshipping, print-on-demand, and direct sales are options for breaking into a business without shelling out a lot in upfront costs.

Picture this: You design something for T-shirts, mugs, or other custom items (or pay a one-time fee for someone else to), upload the design on a third-party supplier portal, build your store on a platform like Shopify (which costs less than $50 to launch), and then let the third-party supplier take care of the production, inventory, and shipping.

Products are made only after orders are received (thus, printed "on demand"), allowing you to avoid several overhead. Sites like Amazon offer dropshipping, and there are other platforms that allow you to create your own marketplace without having to take care of order fulfillment.

If you've ever heard of Avon, Mary Kay, or Tupperware, then you know a bit about direct sales. With this model, you might have to pay a registration or starting fee (several of which are less than $100), be offered an optional, moderately priced starter kit of products, or both. You'll earn a commission on sales (with some as much as 50 percent) and you'll be able to tap into a network of support from others in the industry.

The direct-sales market includes selling almost anything nowadays—cosmetics, kitchenware, coffee, health and wellness supplements, hair extensions, appliances, even medical scrubs—but be sure to look into the fine print on quotas, refund policies, and earnings or incentive models. Avoid scams, and be sure you have a realistic understanding of the sales savvy, time commitment, and financial investment required for success in these types of businesses.

6. Be patient and save up.

Some of us want to start something without worrying about a loan to pay back or investors to answer to, so a savings plan is the best option. If you don't have enough money right now, save up. It may take a bit longer, but hey, you have to start somewhere. Karen Young, founder of Oui The People, a personal care brand, saved up $1,500 while working for Estee Lauder to launch the beginnings of her business. Shana Cole, founder of The Shana Cole Collection, used $4,000 in savings to launch her first line of lipsticks and expand her customer base from Jamaica to the U.S.

Slow and steady can win the race, and if you're able to be disciplined, set a goal, and stick to a plan, you'll eventually have the money you need to get started. Think about it: Saving just $5 a day can go a long way. In one year, you'll have more than $1,800 for your entrepreneurship adventure.

Look at your current budget and needs, and find areas where you might be able to cut back or adjust in order to pour into your "Business Launch" fund. Also, be sure to look into savings accounts that have higher interest rates or high yield options so you can get the most from your efforts. Squirrel away your next tax refund, or find ways to give your savings a boost such as reselling items or downsizing your home or car. Implement settings like automatic transfers or deposits to a separate account so that you'll be sure to hit your goal in the time you need to.

Finding the money to start your business on a small (or barebones) budget is all about being creative and figuring out the best route for your future. The key is to at least take that first leap, with research and planning as your parachutes, and just go for it.

For more business tips, career advice and profiles, check out the xoNecole Workin Girl section here.

Featured image by Getty Images

This article is in partnership with Xfinity.

Those who have experienced an HBCU homecoming understand the assignment. Students, alumni, and family of a Historically Black College and University gather to partake in the excitement of celebrating the heritage and culture of the school. It's a time of joy, honoring traditions, and for some, reflecting on the good ol' days. Homecoming weekends are spent eating well, laughing plenty, and enjoying the sights; and there is plenty to see! (Spoiler alert: Sleep is not on the syllabus.)

Keep reading... Show less
The daily empowerment fix you need.
Make things inbox official.

When I think about actresses who have been cultural figures throughout my lifetime, Gabrielle Union-Wade is truly one of the first names that come to mind. I can recall being on the playground in grade school urging my friends to learn the cheer routines from Bring it On just as easily as I can remember a few years ago watching Being Mary Jane, crying from the relatability of Mary Jane's life struggles (a story for another day). It's inspiring to watch a powerful black woman whose art has been a consistent source of entertainment and influence. Although I must say, I think many of us have grown to cherish her personal journey and stories just as much.

Keep reading... Show less

Feed-in braids have become one of the hottest hair trends on the scene. These types of braids are created by "feeding-in" pieces of hair extensions to the main braid so that it gradually grows in size. It gives the illusion that the hair is directly growing from the scalp, which comes in clutch for styles that requires synthetic hair. This type of styling allows for a more natural look at the hairline and it protects your edges and hairline from excessive tension from heavy hair extensions thus, reducing the likelihood of traction alopecia (or loss of hair from the hairline.) And for women of color, tight braids or pulling the hair back too tight is one leading cause of this type of hair loss.

Keep reading... Show less

As the winds cool and the leaves change colors, it is without fail that I get this invigorating feeling. Potentially a feeling left over from childhood where every September presents a new opportunity to reinvent yourself, or possibly the contagious buzz of fashion weeks across the globe with streets lined with inspiration for how to style fall's hottest trends. Regardless, there's no doubt that my love of fashion rears its head at this time and always pulls me back into the fold. The fun, albeit overwhelming, thing about this season is the sheer volume of trends presented on the runways. In many ways, we're taking a trip down memory lane, but in other ways, we're seeing the rules of fashion being reinvented in front of our eyes.

Keep reading... Show less

When we think of R&B, we think of soul. Soul, by definition, is emotional or intellectual energy or intensity, especially as revealed in a work of art or an artistic performance. Black people are soul. Everything about us. Our hair. Our energy. Our skin. And, without a doubt, the creativity that courses through every inch of who we are. So, when it comes to our music, spiritual experiences are often what we call them. Makes sense, for there are no other people who remain unbroken the way we do. And every so often, an artist comes along who seems to be the physical manifestation of all that we are.

Keep reading... Show less
Exclusive Interviews

How Christina Milian Reclaimed Her Confidence After Overcoming Postpartum Hair Loss

The multi-hyphenate talks postpartum, love, life, and the hustle of being Christina Milian.

Latest Posts