So you tried everything and asked everyone, but nobody offered you a loan? Well, do not despair; others have started businesses in similar circumstances. Starting a business without outside funding is known as bootstrapping.
In bootstrapping, the entrepreneur uses his or her personal savings, overdraft, or bond on their home. Most well known successful business entrepreneurs like Bill Gates (Microsoft), Michael Dell (Dell computers), and Richard Branson adopted a combination of personal bootstrapping plans to start off their businesses. To obtain maximum result, you need to use a combination of bootstrapping options to leverage every opportunity instead of focusing on one option. marketThere’s is no uniform “Start- up” fee for building a business, so different businesses will have different needs.
It’s important to first estimate how much you need before you start finding alternative methods to fund your business. There are two main parts of starting a business with less: Lowering your costs or Increase your available capital from outside source. These have three options, but I will discuss one. Reduce your needs: your first option is to change your business model to demand fewer needs. For example, if you were planning on starting a company of personal trainer, you could reduce your “employee” expenses by being the sole “employee” at the start. Unless you need office space, you can work from home.
You can do your home work to find cheaper sources of suppliers or even cut out the entire product lines that are too expensive to produce at the outset. The following tactics will help you start your business with minimal capital: SIX TACTICS FOR STARTING A BUSINESS WITH NO MINIMAL CAPITAL 1.Break the Golden Handcuffs The reality is that starting a business entails a lot of sacrifice in your personal life and tightening the belt. Once you have set a deadline to launch your business, you have to learn to live on less and put money aside to help you fund the business.
Back yourself An entrepreneur who is not willing to invest his own money into his business does not believe in himself. Once you can invest your own resources into the business, you can expect support from close relatives and friends who believe in you and know the amount of money you have pumped into the business, which is a clear indication of your commitment to make the business succeed. DIY (Do It Yourself) An entrepreneur at the start-up must endeavour to be jack of all trades. Although you may have your own specialty it does not matter when you add some other works to your business, after all, the more you do, the less you need to pay someone else. This can help you save some money and get the business off the ground. The entrepreneur and the management team at the start-up stage must train themselves to do most of the work instead of outsourcing.
Work in Parallel At the start-up stage of your business, you can sell your time to raise some money while you are building your business from the income generated from the consulting work.
Keep the End in Mind Although consulting can generate some money for a start-up business, there is a possibility of over dependence and forgetting the big picture of developing your own brand. This means the entrepreneur can become greedy and caught up in a circle of generating money outside of the business, with fewer opportunities, than selling from within the business. Although the latter will take time and needs a long-term mentality, the rewards could be greater. Focus on cash-flow. Cash is the king, queen, and prince of every business.
Courtesy : vanguardngr.com