Tuesday 30 June 2015

How do I start a business from scratch with no money, no credit and no expert friend to help?

How do you start a business without capital?

I have a few suggestions for you.  Assuming:
a) you have a believable business plan
b) you have a compelling value proposition for your customers
c) you are credible in the eyes of your future customers (i.e. they will believe you can realize your business plan so long as you get the start up funding)

1. Try getting customers to finance your start up.  Collect enough advance conditional sales orders to cover your start up costs, each one conditional until you have all the orders you need to fulfill your product/service promises.  Your fall back position: get Letters of Intent to buy if and when your product/service is built (meeting specified performance criteria within a time frame).

2   Try getting your suppliers to finance your start up.  They'll be more inclined if you have Conditional Sales Orders or Letters of Intent, as above.

3.  Look again at your startup costs.  Can you trim these?  If you have no other options, trade equity in return for materials and services you need to get started.

4. Consulting Revenue.  This is the way many start ups fund themselves while developing a product toward first release, and even after, until revenue from non-consulting sales are sufficient to carry all costs.

Not an exhaustive list, but perhaps there is a useful idea in this for you.  I assume you've already approached friends and family, and can't personally fund or bank finance your start up.

Source: www.quora.com

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