Although it may seem absurd or absurd in itself, it is entirely possible to become an entrepreneur without money or experience. Now, with less money and experience, more intelligence and work are necessary. That siren song that invites you to be “your own boss” is beautiful. The one who makes all the decisions and reaches the goals. But entrepreneurship is an extremely complex task.
How complex?
Well, at least 75% of “start-ups” fail. And this taking into account the statistics in the most advanced economies.
On the other hand, and on a personal level, entrepreneurs are much more anxious people than others, and they experience greater stress on a day-to-day basis. After all, when someone is solely responsible for the results it is logical that they carry all the weight of things.
The good news is also well known: entrepreneurship is the best option for professional growth. And one of the most important contributions that people can make to the world in which they live. Therefore, it is only necessary to be aware of the difficulties and have the disposition to learn what is necessary to overcome them.
To be an entrepreneur without money or experience, you have to take into account the following:
Identify A Profitable Idea To Develop A Start-Up
1. Ask your friends and acquaintances what bothers them.
Startup founders always draw inspiration from their frustrations. Travis Kalanick and Garret Camp started Uber after having trouble getting a cab. Andrew Kortina and Iqram Magdon-Ismail founded Venmo (acquired by PayPal) after they had trouble paying mutual bills by check. Chris Riccobono launched UNTUCKit, a line of shirts that looks good without buttoning after being frustrated by how wrinkled and ill-fitting his normal shirts were.
With this in mind, ask your friends to keep track of the everyday things that bother them. Then go through those lists and look for problems you can solve.
2. Prepare for the future.
As the environment evolves, people require variety of products. As an instance, the rise of Uber, Lyft, and other “ride-hailing” applications spurred demand for many other apps that delivered the cheapest prices at any given time.
If you want to stay ahead of the innovation curve, read the trend predictions for your industry or market.
3. Check the internet.
Contemplating what other people have invented is an excellent way to activate your own thought processes with a high level of creativity.
For digital inspiration, periodically check out sites like Product Hunt, an always up-to-date platform of the latest apps, websites, and games. While Kickstarter is ideal for physical products.
Very interesting ideas can come up by browsing Uncrate, evaluating Werd, and other news on Wirecutter.
4. Do something better or cheaper.
It is not always necessary to develop something new. There is the possibility of offering an existing product at a lower price, better quality, or ideally both. This guarantees a good number of clients, since it works in segments and niches that have established dynamics.
Keep an eye on everything you see and wear. Then go through those mental records and look for something you can improve.
5. Focus on a business category that is growing.
Growing businesses offer many opportunities, precisely because their own dynamics prevent all the details from being considered. Identifying a rapidly growing business category and carefully evaluating aspects that may be missing opens up interesting business options.
After choosing a category, you should study all the products included in it. What are the benefits of each product and how do they vary? What is your packaging and marketing strategy? What are the possible improvements?
Once you’ve chosen a product, consider questions like what can be done to improve it? Can I add a new function? Can you consider a different material? Can I customize it in any way?
6. Work with any unsatisfied demand.
Many start successful businesses after identifying a gap in the market.
Other Suggestions:
- Connect with other entrepreneurs:Networking not only helps build valuable relationships, it also provides many ideas.
- Research available patents:It is not about copying any invention, however browsing through those documents can give very good ideas.
- Have a brainstorming session:Invite other business-minded people to a brainstorming session. Ask them to come prepared to discuss a certain product category or a specific question: “What is your favorite type of X and why?” or “Do you use something to achieve Y? Why or why not?” The answers can lead to great ideas.
Validate the idea for the Start-Up
Once the idea deserves consideration, the process only begins for the entrepreneur without money or experience. Nothing is finished yet. It is necessary to define the degree and level of interest that the idea will have for other people.
For this validation it helps a lot to develop a Minimum Viable Product (MVP). An MVP is the simplest and most basic version of the intended product or service. It is functional enough to meet the first customers and have an idea of what needs to be improved.
For example: if you plan to create an app that connects college students with virtual tutors, you can create a basic version, manually invite tutors found online to join, and then post the link to the app on the school’s Facebook page. University. If you get a decent number of subscriptions, it is a sign that you should move forward. If you hardly get any, you should reconsider the idea or start over.
Interviews with potential clients is another option. Give functional demos of your product, ask them what they like and don’t like, how much they would pay for it, how often they would use it, etc.
It is also advisable to “list the problems that the product is supposed to solve and then ask for opinions and rank each one.”
If you want to verify the interest of the market before any development, you can enable a WEB page that describes the product or service. Solicit email addresses in exchange for early access, a free subscription, a membership, a discount, a product upgrade, or some other alluring offer. Then promote the product on social media, paid search, etc., and check how many visitors become subscribers.
Find A Co-Founder
Conventional wisdom recommends that an entrepreneur with no money or experience seek out a co-founder when starting a business. There are three fundamental advantages to it:
It is easier to obtain financing. Many venture capitalists are reluctant to back solo entrepreneurs.
Many studies have determined that the “sole founder” is one of the main reasons for failure of a Start-Up. Paul Graham of “Y Combinator” writes: “Have you ever noticed that few successful startups were founded by just one person? It seems unlikely that it is a coincidence.
There is emotional support. Running a business is a stressful, exciting, and unique experience. It is very difficult to be alone on that emotional roller coaster. A co-founder understands exactly this and helps to feel less alone in the endeavor.
They can contribute with different skills, knowledge and connections. Possibly one is an excellent salesman and the other fundamental in the technical part. You may possess useful business connections or management skills. Choosing a co-founder with complementary skills is a great way to increase your chances of success.
Another aspect that accounts for your success is having a presence on Wikipedia. It magically uplifts your popularity on the web, queueing your profile among the thousands of A-listers on Wikipedia including entrepreneurs, entertainers, stars, athletes, and other notable personalities. So, it’s all worth to acquire Wikipedia page creation services in order to get your Wikipedia presence in place.
However, there are also drawbacks with a co-founder.
There is conflict. In some situations, there will be unavoidable disagreements. Little disagreements are healthy and productive, but if you don’t find a quick fix, valuable time and energy will be wasted. And it can also damage team morale.
The patrimony must be divided. If you are the sole owner of your business, you have 100% of it, although this warrants special consideration for an entrepreneur without money or experience.
It is not easy to find a co-founder. It can be difficult to find someone with the same business ethics, work habits, and complementary personality. A person who also believes in the same vision, contributes their skills and has the desire to be its co-founder (in the first place).
All of the above establishes difficulties that cannot be underestimated.
Where To Find A Co-Founder?
If you decided favorably on a founding partner, the next step is to find one. Explore your own network first. Someone you already know or for whom connections can vouch is less risky than turning to a stranger.
You can also attend entrepreneurship events where you can eventually meet potential partners.
Considerations In Case Of Opting For Financing To Activate The Venture
Financing is an alternative to investor or capitalist partners and another functional mechanism for the entrepreneur without money or experience.
Obviously, it constitutes a debt, a liability for the project and the entrepreneur. But the reality is that debt is neither good nor bad, it is simply more or less necessary. Virtue is found in establishing dominion over it.
Funding for the project can be found from the following sources:
1. Consult your friends and/or family to invest in your business.
Many entrepreneurs rely on friends and family for an initial investment, typically called “seed capital.” You can exchange funds for an equity stake in the project (for example, the cousin who receives 4% from the company after investing $12,000), apply for personal loans (with or without interest) or even donations.
2. Apply for a subsidy to small companies (if the programs were available in the economic-financial offer of the medium).
Many governments (federal, state, and local) have programs to help small businesses, including low-interest loans, venture capital, and grants. Do a thorough survey of these options. Most businesses are not eligible, so you may not find anything. However, it is worth investigating, because it is finally “free money”.
3. Evaluate “crow funding” platforms.
This strategy does more than generate cash. Additionally, it can assist you in obtaining early product feedback, brand exposure, and, on occasion, press coverage if you have an intriguing narrative or an extremely amazing product. It is a very useful mechanism for the entrepreneur without money or experience.
4. Use “angel investors”.
Angel investors look for companies that are in the initial stage of their life cycle, and in which the capital invested can reach 10 times their original size. They generally invest between $25,000 and $100,000. If you get the numbers right, angel investors are looking for deals that could reach a value of $2.5 to $10 million in the future.
They will be extremely diligent to make sure you have a good understanding of your target customers, the space the product will occupy, how you will make money, and how you will scale the operation.
Make sure you are prepared with a strong business plan and early signs of project pull (e.g., “Average user refers two additional leads in their first week” or “We doubled our revenue from January to March”).
Financing an “angel” is usually associated with their experience and connections. And as payment of the capital, a share of participation in the business will be negotiated.
5. Apply for risk capital.
Venture capital firms are looking for young private organizations. Like angel investors, these equity firms favor risky, high-yield investments. The returns they expect depend on how mature the project is. If they invest just before the company goes public or is acquired, a 3X return is good. But if a venture capital firm invests early they are probably looking for a 7X to 10X return.
6. Use a Credit Card as a short-term cash option.
It’s generally not a good idea to use a credit card to pay for business expenses, unless, of course, you can cover the bill. And sometimes there is no other option: you need money and fast. Take care not to sacrifice your credit score and don’t accumulate unnecessary debt because that will damage your business in the long run (not to mention your personal financial health).
