Taking that first step to start up a small business can be scary. Once you have convinced yourself that it is time to take action there is still the big question of “Where will I raise the money”?
My story starts with the desire to run a small OSCommerce (OSC) site. I had first been exposed to OSC somewhere around 2000 and fell in love at first site. I couldn’t believe that with this software and less than $10 per month I could open a store, accept credit cards, and begin making money in my sleep. After a while of toying around with various ideas I found my “widget” in Xeko.
I knew I was going to need about $1500 to really get everything I needed so I began looking for things to sell around the house on eBay. I started selling my old collections of comic books and cards. Once I had about $200 I used that to buy some Xeko product from a local retailer so I would have some product to get started typing descriptions for the site.
Meanwhile I was also taking a little bit of my daily spending money and tucking it away. $10 here and there adds up real quick. I cashed in my change jar and dropped some computer components and old servers on Craig’s List. I was in business in no time and I never had to break the bank by cutting myself one big check.
Raising money this way in my opinion is by far the best method because it keeps you focused on your goal of starting a business everyday.
Here are some suggestions for raising startup capital for a small online business:
- Walk through your home with a notepad surveying everything you own. Ask yourself how often do I use this and what is it worth? Bikes, extra lawn equipment, old collections of stuff, game counsels, and electronics all make good candidates.
- Start saving your change and your singles everyday. This is a great one that I continually use because it averages about $2 per day so you have an extra $100 or so every couple of months.
- Do some side jobs. You’re entrepreneurial and have skills right? Help someone out and make some money at the same time. It’s a win-win.
- Change an expensive habit (Latte Factor) like packing a lunch and avoiding the vending machines at work.
- Ride a bike or car pool and set aside your gas money.
- Pay yourself first even if it’s just $50 per paycheck set aside in a different account.
Do whatever you have to do to get started with one exception. If you borrow the money make sure there are no ownership hooks into your business. Taking on a financial partner in this fashion will kill your motivation. Ideas this small generally turn into something 10 times as valuable or fizzle out within 6 months. Borrowing something so small with such huge upside possibilities violates my number one rule which is:
Never sell your potential!