woman sitting at desk doing paperwork
Choosing an idea with low overhead cost and tapping your own network of family and friends are two key, simple steps in starting a business inexpensively. — Getty Images/Jirapong Manustrong

Contrary to popular belief, you don’t need to have a huge amount of cash on hand to start a business. With careful planning and the right idea, it’s relatively straightforward to start a new venture for cheap. Here are some ideas to help you get started.

Pick an idea with low overhead costs

Of course, some businesses are more expensive to start than others. Starting a clothing boutique on Main Street is going to require significant investment in real estate, inventory and staff salaries. Instead, think of a business idea that requires time and effort. Some of the cheapest ventures include:

  • At-home service business: Tutoring, dog walking, au pairing, or pet sitting are all services you can offer from your home to save on rent.
  • Skilled labor: Offer your time as an interior decorator, handyman or landscaper, as these positions all require basic tools but no office space.
  • Business consulting: Many nonprofits, companies and startup organizations are happy to pay for contractors to provide short-term expertise in a specific area, such as accounting, marketing or hiring.
  • Virtual assistant: For those with time and energy, all you need is a laptop, phone and internet connection to help an executive manage their schedule, stay organized and cover other admin duties.
  • Microentrepreneurship: This term refers to many positions that are available through the gig economy. Companies like Lyft, Uber, Postmates and Airbnb all make it easy to get to work without much capital investment.

[Read more: Looking to Launch Quickly? Business Ideas You Can Start Today]

Take advantage of free tools

There are plenty of free tools to help you get your business off the ground. From free branding materials to free marketing platforms, look for ways to save money as you start to build awareness of your new venture.

Create your own logos and other branding materials on Canva, or build a free infographic on Piktochart. Free stock images are available on Unsplash, Pexels and Pixabay. Schedule appointments and meetings with free Woven or Calendly apps. Use Docracy to send and sign legal documents. Google Drive is great for file sharing and storage. For marketing, try starting an email newsletter for free with MailChimp. Schedule your social media posts with free platforms like Buffer or Hootsuite. List your business on Google My Business to make it easy for people to search for and find you.

[Read more: 9 Free Ways to Promote Your Small Business Now]

Start small, get lots of feedback and take advantage of free tools and feedback to develop a business with little to no initial funding.

Use your network

Whether you’re trying to build brand awareness, looking for a little funding from friends and family or in need of a mentor, networking is going to be a critical skill. Build a business plan that you can take to your former colleagues, bosses, friends and family to ask for their support. Look for mentors that are offering their expertise for free through your local SCORE chapter or industry association. Test a new product, ask for feedback on a logo, run an at-home restaurant before you sign a lease on a new cafe. Start small by selling to those you trust before dedicating any serious funds to building your business.

Apply “lean startup” principles

Eric Ries, the founder and CEO of the Long-Term Stock Exchange (LTSE), wrote a bestselling book called The Lean Startup. The methodology outlined in the book provides a roadmap for entrepreneurs to start a business with little investment. The three main principles, simplified, are:

  • Skip the business plan. Instead of spending months planning and doing research to form a cohesive business plan, start with a hypothesis. How will your company create value for itself and your customers?
  • Test your hypothesis. Ries suggests getting customer feedback as soon as possible. Go to your network and others to hear their opinions on your product/service features, pricing, distribution and marketing strategy. You’ll get instant feedback on what works and what doesn’t, and can adjust your business idea as you go.
  • Try agile development. Instead of taking years to develop the perfect product, develop “iteratively and incrementally.” Test as you go and adjust your business offering as you get more and more feedback on different versions of your original vision.

Start small, get lots of feedback and take advantage of free tools and feedback to develop a business with little to no initial funding. Once you’ve proven your idea is a good one, you can meet with investors, start a crowdfunding campaign or take out a loan.

CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.

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Published July 15, 2020