In 1998 I published the first edition of 48 Days to Creative Income (content now in No More 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 2014) 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 – and of course, some are brand new.
- Less than $5000 49%
- $5000 – $10,000 10%
- $10,000 – $49,999 15%
- $50,000 – $100,000 12%
- More than $100,000 14%
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.
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 this 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 is on track to add $175,000 in revenue 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 adopted or been stirred by 48 Low or No Cost Business Ideas to find their own profitable business.
What business idea do you have ready to launch?
“Empty pockets never held anyone back. Only empty heads and empty hearts can do that.” – Norman Vincent Peale
Dan, this was very encouraging to read!
Sometimes we think need the quick fix NOW to start something. In a recent interview you mentioned about setting aside 3% for investment in the education of ourselves…this advice has been GOLDEN for my family and I. While the process of starting our own business hasn’t been overnight, the journey in getting to do so while investing in our personal growth along the way has been very rich and certainly something that couldn’t have been earned with a quick fix.
Very encouraging that anyone can get in the “game” and succeed with hard work and determination without having a large sum of money to start. We live in a world of opportunity!
Two things…
1. Keep sharing the $430k in debt story. That was one of the most impactful stories I heard when I first started out.
2. I’m proud to say I’m one of those people in 48days.net who started with what he had, took specific action, and am reaping the rewards. And the great news…it gets better every year!
Encouraging, however, I am stuck about how to get a bakery going even though I only know how to bake six types of bread. I’m completely lost about where to begin, how to hire employees, etc.
Sam – I would never “start” with having to hire employees. Just start making your bread – wow people with what you can do. Drive around town selling it and build your reputation.
I’ve been doing that at some of the schools I visit as a clinical social worker. It’s tough. But worth it. There are moments I want to give up as I’m 44 and have no savings and no retirement from being stupid in my 20’s and 30’s. My 7 year old daughter is that little voice that keeps telling me to never never give up.
Timely and pertinent! I believe a lot of times people either just want to throw a lot of money at a plan in lieu of doing the hard work or they use the “no money” argument as an excuse to avoid take action. I love the Norman Vincent Peale quote. It brought back fond memories. I used to lie on the floor on Sunday mornings watching him on a small three channel black and white TV. I still remember a lot of his lessons to this day. Thanks Dan.
Just start with what you have. Love that. That’s how I started. It all began with a made up mind, an internet connection and my kitchen table. Dream, plan, act – the golden formula. I got encouraged when I saw Jeff Walker at his kitchen table when he did his first launch and was tremendously successful. You’re right – we don’t neccessarily need fancy equipment, lush offices or even a 12-person staff. The change starts with the person looking me back in the mirror.
It is great to have great examples of people like Dan who are willing to share the truth about mistakes and missed steps that allow us to see a better path to the future we want.
Great stuff! I’m a little stuck, myself. Or maybe just impatient. I’ve officially launched a real estate photography business. I know that both marketing & building up a client base takes time. I work full-time & homeschool in the evenings after work. So I’ve got 6-6:30 in the morning to work on the business. I am moving forward on that, just very slowly! And startup costs have been minimal – most of my photography equipment was bought used and way before I decided to start the business. Many people do believe it’ll take a fortune to start a business, but that isn’t true! They just need to start where they are. With hard work & perseverance, it will all fall into place.