In 1998 I published the first edition of 48 Days to Creative Income (content now in No More Dreaded Mondays). In that little 3-ring binder product I addressed the idea of needing a lot of money to start a business. I showed the figures from INC magazine that 34% of all new businesses needed less than $5000 to launch. 26% needed no capital at all. 9% needed $5000-$10,000 to start. Yeah you say, that was 16 years ago – if only I had started my own business back then.
Well, this is your lucky day! I’m reading in this month’s issue of INC magazine (September 2015) about the latest figures on the same issue. Here is the amount of capital this year’s 500 fastest growing companies needed to launch their businesses.
- Less than $5000 49%
- $5000 – $10,000 9%
- $10,000 – $49,999 17%
- $50,000 – $100,000 10%
- More than $100,000 15%
So instead of 34% being started with less than $5000 – today it’s 49%. Almost half of all new businesses that go on to hit the INC 500 list need less than $5000 to start. The amount of money needed to start a business is decreasing. Think about it – 10 years ago it would have taken $20,000 to get a really robust website for an online business. 5 years ago, maybe $5000. Today you can be up and running for less than $50.
I have people asking me every day how they can get venture capital funding for their new business idea. Don’t waste your time trying. Fewer than 4% of these businesses got money from venture or angel funding. Very few got bank loans – most started with what they had and bootstrapped their businesses. 71% of these companies started with the CEO putting up their own savings.
In that first 49% category, many launched their businesses with no money at all – just an idea and a plan of action.
The only business where I borrowed money to get in ended up being the costliest mistake I’ve ever made. I borrowed $40,000 and ended up $430,000 in debt and out of that business. In January of last year I launched a new business category here – the 48 Days Mastermind. I put $1000 in an account to cover incidentals and opened for business. 30 days later I took my $1000 back out and that little business added a little over $150,000 in revenue last year with an upward swing for this year. The 48Days.net community is full of people who have started with what they had, taken specific action and are now reaping the rewards. Many have started with my 8 Keys to Starting a New Business as a way to stretch their thinking and to find their own profitable business.
What business idea do you have ready to launch? Check out my tips for starting Monday with a winning attitude.
“Empty pockets never held anyone back. Only empty heads and empty hearts can do that.” – Norman Vincent Peale