Serial tech entrepreneur – COO and Managing Partner at Jafton.com and Missed.com | Expert in remote work automation and voice and chat AI.
Many people have ideas for businesses, but they have no idea where to begin or think they need a lot of resources up front to start out. While having additional resources is beneficial, it is not a must to have a pot of gold when embarking on a new venture.
Being an entrepreneur myself, I’ve learned five different ways you can start a business from the ground up you might not have considered:
1. Bootstrap a minimum viable product. Bootstrapping is all about starting with what you have, rather than waiting for a perfect moment and the perfect resources to start a perfect project. To bootstrap, you need to come up with a minimum viable version of your product and evaluate how much it would cost to build it.
In the book The Lean Startup, Author Eric Ries described how you can create an MVP for your tech project. Put simply, you can create an MVP by defining what your business or product does in one simple sentence. Then, build what you described, and eliminate everything else.
For example, Uber’s MVP thesis likely would have been: “Order a car with a driver through a smartphone app.” In the beginning stages of the company, that’s exactly what you could do: simply request a ride. It wasn’t until later iterations that Uber’s services grew. From my perspective, the MVP is what allowed the company’s founders to find out whether their idea was worth pursuing without breaking the bank.
An MVP allows you to develop and launch your business for less money. The big investments should come only after you are able to validate your concept. This is how my team and I start all of our new projects at my company as well.
2. Use a customer-funded capital model. This might be hard to believe, but sometimes, people will be willing to pre-pay you for a service or product before it launches if you can show validation that you will deliver on your promise.
This is exactly what I did when I was starting my wholesale sports nutrition business back in 2017. I didn’t have the capital needed to invest in inventory, so I approached one of the wholesale distributors with whom I had a good relationship. I offered to get him the same items he was buying at 30% off if he prepaid me the entire amount. He agreed to do that if I provided him with an official receipt of payment as a guarantee of delivery. The deals were successful, and I was able to fund my new business with money I received from my customers without having anything myself.
3. Consider crowdfunding. The beauty of the internet is that it lets you reach millions of people in an instant and broadcast your idea at almost no cost. This is why I believe crowdfunding platforms are worth considering if you’re starting a business from scratch. These platforms allow you to raise a certain amount of money for an upcoming product.
From working with a client who has raised more than $1 million on one of these platforms, I learned that it’s important to show what your product will do when it’s ready, as well as offer perks to those who contribute, such as early access, discounts or sometimes even equity in the business. This has the potential to help you raise funds from hundreds or thousands of people from all over the world who believe in your idea.
4. Think beyond your family and friends. New entrepreneurs need funds for their businesses, so many will tap into their immediate networks to ask for those funds. But I believe it’s important to look beyond your family and friends and think about who, outside of that network, could invest. Keep in mind that investing in a startup is a risky venture, so you need to ensure those you ask believe in your project as much as you do.
5. Become an intrapreneur. This one is my favorite avenues for running a business, as it is a method that has worked out very well for myself. An “intrapreneur” is essentially an entrepreneur within an existing company — someone who didn’t risk their own funds to start the business but joined an existing one as a partner or has become a partner within time. This is exactly how I got into the tech industry. I started working for my mentor, who is now my business partner, as an intern, and I worked my way up to the role of managing partner.
If you have great ideas but are lacking experience and resources, joining an existing business or an entrepreneur who can mentor you and potentially take you on as a partner can be an effective way to become a leader.
In short, there are many ways to start a business without necessarily having funds saved up or raising a lot of money from venture capitalists. Be a little creative, explore all your options and make an educated decision.