How to Start a Business with No Money

Many of us have considered what it would be like to start our own business venture: having the autonomy of being our own boss, the satisfaction of building something that others use and love, the potential for great profits, and perhaps the flexibility to work wherever and whenever you choose. 

At the same time, there are numerous valid reasons that many of us do not take the plunge into becoming small business owners. The stability of W-2 employment, having a job that requires one core skill or strength rather than needing to “do it all” as a founder, and uncertainty over where to find potential customers or how to finance a new business are all challenging hurdles.

This last concern can be a major roadblock to a burgeoning business idea. Don't worry. If you need to start a business with no money, you still have options.

In this article, we'll offer some guidance on how you can start a business with little to no money for up-front investment. 

Erika Taught Me

  • Many businesses can be started with little money: providing services, selling handmade or digital goods, or teaching a skill.
  • There are free resources to help you get started: social media, website builders, and your local Small Business Administration.
  • Do market research by giving your product away for a short period of time to see what demand is like.
  • If you need funding consider a business loan or getting a business credit card (use with caution)
  • Consider financial and legal obligations as early as possible

Business ideas you can start with no money

There is an old adage that “it takes money to make money,”  though this rule is becoming less true in the digital age. While this list is by no means exhaustive, these categories and examples of business ideas may inspire you if you're looking to start a business with no money. 

Physical services: Examples abound of entrepreneurs who began a successful business by providing physical labor such as mowing lawns or helping others move furniture, then grew it to become an established moving or landscaping business. 

Digital services: Digital footprints are growing in importance for both individuals and corporations. There are online business opportunities for photography, video editing, social media management, advertising, website design, creative writing, and affiliate marketing. 

Teaching a skill: If you already possess in-demand skills, there are opportunities to start a business teaching others. Some examples include dancing, yoga, painting, singing, photography, and sports.

Selling products. While physical storefronts may require significant startup costs, there are many business models that allow you to sell online much more cheaply without your own online store.  For example, you could start an Etsy store selling digital products, like print-on-demand designs, digital templates, or handmade goods. Platforms such as Etsy, Amazon, and eBay make it easy to create listings for free or as little as $0.20.

These are just some of the many types of businesses that can be started without meaningful financial investments. Perhaps there is something you love doing already that fits into one of these categories! 

Related: How to start a side hustle

Conduct market research

It is extraordinarily rare to create an entirely new market; however, it is very possible to solve a pain point, improve on the popular way of doing something today, or appeal to a niche audience. Other entrepreneurs are likely doing something related to your proposed business idea, which is completely OK! 

To start market research, find related businesses and observe their products and services offered and at what price. Some questions to keep in mind:

  • What is your unique business proposition?  How would you stand out from these other businesses? 
  • Do you have a niche target market?  For example, many people give advice; however, those seeking advice may look for different things beyond experience such as an engaging communication style or relatable life experience. 

One way to test the market is to give away your product free for a limited time. If you struggle to give away a service or product for free, it will be extremely difficult to find paying customers. However, if there is a flood of interest for your free product, then you’ll know there’s a market, and the only question is how to price and position yourself to make money.

Search for free resources

Social media has dramatically increased web accessibility for small businesses. Businesses no longer need a website or online store to survive. For example, you can start your marketing strategy with a free business page on Facebook and profiles on Instagram, X (previously Twitter), and TikTok.

Use these channels for sharing media that helps you reach new prospects and build a community with current followers. Facebook, Instagram, and TikTok have shops where you can sell products directly, though many entrepreneurs use social media to link to marketplaces such as Etsy or Amazon. 

Here’s an example. You may use the free version of Adobe Express or Canva to create designs or slogans that can be printed on t-shirts and mugs. You share these designs on Instagram and Facebook, where you direct interested buyers to an Etsy store. That Etsy store is linked to a print-on-demand service that handles all the printing and shipping, leaving you with a share of the sale at no additional costs. 

In addition to free marketing and selling resources, there are a host of other resources to take advantage of including:

  • Networking on LinkedIn
  • Tutorials on Youtube 
  • Finding business mentors through SCORE
  • Learning and Development courses provided by the Small Business Administration

Consider financial implications

There are a number of important financial considerations when starting your own business. 

Leaving your job

Many full-time workers spend at least 40 hours per week in their current role. When considering the need to eat, sleep, commute, exercise, and spend time with friends, family, and partners, you may have very little time and energy left to start a new business venture. Moreover, having just a few hours each day to work on a business idea may make for slow progress that could be demoralizing. 

On the other hand, your job may provide a steady paycheck for rent and other necessities, healthcare insurance, and a retirement plan such as a 401(k). While many successful business owners start a business as a side hustle, if you have the means and support, you may be able to make significant progress much more quickly with a full-time focus.

Some may also argue that putting yourself in a position of need may trigger a greater sense of urgency to make your business idea successful. Others with lower risk tolerance may strongly prefer to keep their current job until their side hustle nearly replaces their current income. 

Business expansion

To start a business with no money may require that you start small. For example, if you’re making handmade goods and selling them on Etsy, then you may only have enough initial capital to make a few products. However, as you sell, you can use that revenue to purchase more materials and continue to grow.

Similarly, if you start as an individual selling services to help move furniture, you may eventually take that income and invest in a moving van or improved equipment.

Funding your business

While this article is focused on how to start a business with no money, there may be occasions when you require more capital. We highly recommend that you avoid high-interest debt as much as possible.

First, try to fund your business using personal savings or apply for small business loans or small business grants. After this, it can get tricky. Borrowing from friends and family would be the cheapest option, but can risk important personal relationships if you run into repayment struggles.

Bank loans may be an option, but some banks may be reluctant to fund new businesses without meaningful collateral. Finally, you may be eligible for a business credit card, but these come at an extremely high cost of carrying a balance from month to month. 

Tax considerations

Starting your own business may provide meaningful tax benefits. For example, operating a business out of your home may provide deductions for part of your rent, cell phone bill, and utilities. When you first get started as a business owner, you will likely operate your new business as a sole proprietorship, with taxes affecting your personal returns. As your business grows, there may be benefits to converting to a different structure such as an S-Corp. We suggest consulting a tax professional before using your business for write-offs and for help determining the best business structure.

As your business grows and you begin working with customers or taking on financing, you may consider starting an LLC. In some cases, an LLC can shield your personal assets from liability in the event your business enters bankruptcy or is faced with a lawsuit. To the extent you can afford one, it’s usually worth consulting with a legal and tax professional before dealing with customers or entering into legally binding contracts.

Woman on computer selling item online: Guide to how to start a business with no money.

FAQs

What businesses can I start with no money?

We discussed many types of businesses that can be started with no money including a physical or digital service business, teaching a skill you already possess, and selling products on popular platforms such as Etsy and Amazon.  

Do I need a business license?

Depending on the type of business you're operating, you may require a business license to operate. This is especially true if working with food or alcohol, construction, giving financial advice or managing money, hosting musical events, or using public resources.

Make this a part of your market research, and talk with others in your field or at your local SBA. If you’re selling on another platform such as Amazon or Etsy, you’ll also want to communicate with their seller customer service team.

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Author picture

I'm an award-winning lawyer and personal finance expert featured in Inc. Magazine, CNBC, the Today Show, Business Insider and more. My mission is to make personal finance accessible for everyone. As the largest financial influencer in the world, I'm connected to a community of over 20 million followers across TikTok, Instagram, YouTube, Facebook and Twitter. I'm also the host of the podcast Erika Taught Me. You might recognize me from my viral tagline, "I read the fine print so you don't have to!"

I'm a graduate of Georgetown Law, where I founded the Georgetown Law Entrepreneurship Club, and the University of Notre Dame. I discovered my passion for personal finance after realizing I was drowning in over $200,000 of student debt and needed to take action-ultimately paying off my student loans in under 2 years. I then spent years as a corporate lawyer representing Fortune 500 companies, but I quit because I realized I wanted to have an impact; I wanted to help real people and teach them that you can create a financial future for yourself.

Advertiser Disclosure

Our aim is to help you make financial decisions with confidence through our objective article content and reviews. Erika.com is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as MileValue.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. This in no way affects our recommendations or article content.

Advertiser Disclosure

Our aim is to help you make financial decisions with confidence through our objective article content and reviews. Erika.com is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as MileValue.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. This in no way affects our recommendations or article content.

Advertiser Disclosure

Our aim is to help you make financial decisions with confidence through our objective article content and reviews. Erika.com is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as MileValue.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. This in no way affects our recommendations or article content.