Irene Kotov is the founder of Arielle. Through resume writing services and interview coaching, she ensures her client’s presentation of their most authentic and inspiring self through the recruitment process.
I started my business, Arielle Careers, with no investment. Within the first 6 months from launch it was doing surprisingly well!
If you think that you need capital in order to start that small business of yours, think again. Startup money is great, but it also makes you think in sloppy ways. A shortage of available cash, on the other hand, forces you to think creatively to achieve your business goals and helps you navigate around pitfalls, which stand between you and success.
Here are 3 reasons why having no dough in the startup phase can be used to your advantage.
1. Become A Hardened Businessperson
It’s a basic law of evolution – when your surroundings are arduous, you learn to adapt in order to survive. You can’t afford to be lazy and complacent. And so, you learn to become shrewd, resourceful and clever. You begin to think outside the box for solutions to your problems. You learn the art of taking calculated risks.
For example, when throwing a few thousand dollars on a PPC (pay per click) campaign to test market response is not an option, you might investigate options which don’t cost money and which are easy to resist (which, ironically, tend to be more effective) – like talking directly to people about their needs.
This process of struggle can be very useful in helping to dramatically sharpen your value proposition and learn skills, which will help you outmaneuver your more cashed-up, lazy, competition.
2. Avoid The Seminar Junkie Trap
Because you can’t afford to throw money around, you also become less susceptible to the sales pitches of all the so called “business gurus” out there who are just itching to sell you their “money-making secrets”, seminars and “businesses-in-a-box”.
And there’s no shortage of those. They’ll take thousands of dollars of your money and promise that ownership of your dream business is just around the corner. They’ll sell you a dream that apart from their secrets/software/products, you don’t need to do much else. Some will even suggest to you that you can be in business even if you don’t know what problem you can solve in a marketplace and don’t have a product or an idea.
The trap there is that you can spend a few years and many thousands of dollars, being a seminar junkie. You’ll end up knowing a lot of business theory and will probably end up owning a dozen domain names and all kinds of weird software.
But when someone asks you about what value you deliver, you don’t know how to answer that question.
3. Stop Being A Copycat
When starting a business, there’s a huge temptation to emulate your competitors. You may check out their websites to get “inspiration” for your own web copy. Or you look at the way they package their offerings and make yours a tad different – usually by claiming that yours is a tad better while making it a bit cheaper.
And if you have money to burn, you can pretty much copy their business model, marketing and offering – and purchase everything you need to launch your own version of their business.
Or so it seems on the surface.
Look deeper, and you’ll see problems with this “rich guy buying his way into a marketplace” approach. The main problem is that the things you can easily replicate are rarely what gives your competitors a competitive advantage over you.
And the things you can’t easily rip off – like tested and faultless processes, culture, customer relationships style, company philosophy and IP – sit at the very heart of your competitors’ businesses – and are instrumental in their success.
Which means that if you try to buy your way into business by copying your competitors, you’ll probably end up spending a lot of money on things that don’t give you much power in the marketplace.
If you’re serious about starting a small business and you’re planning to do it with little or no startup capital, you’re going to live through a trying and potentially stressful time.
You’ll find yourself outside your comfort zone and, like most entrepreneurs, will have days where you feel like giving up.
However, this very act of building and managing a business that has little resources and can tolerate even less error, will teach you invaluable lessons. You’ll grow as a human being and as an entrepreneur, and you’ll learn lessons that would have otherwise taken you years to learn had you had more funds.
The best part is, when you look back on your business, and compare where you were to where you are today, and you say that you created this all on your own… You slogged it out. You made your dream happen the hard way… that will be satisfaction unparalleled.
Interested in learning how to fund your business?! Watch and learn from angel investor Judy Robinett. For more on getting your small business off the ground– including funding!– check out resources and recommendations here.