Last updated on May 6, 2022 - My Free Marketing newsletter 👀
The #1 excuse that wantrepreneurs make for not starting a business is that they don’t have the resources. They don’t have the money, they don’t know how to code, they don’t know the right people… etc.
In this post, I’m going to show you how I would start many of your favorite startups with little to NO money.
Let’s dive in.
|BONUS: How To Start A Business While Working A 9 to 5|
How would I start a tech company like Uber right now with NO money?
This is where it gets interesting, because a lot of y'all are not programmers or you're not from Silicon Valley or you don't have a bunch of money and resources to get it going.
So a lot of times you have to actually work backwards. What's the problem I'm solving and what's the simplest way I can get people to give me money for this business?
At the end of the day, Uber’s just a taxi company.
I know, I know… They’ve got the tech, and the platform, and they do a whole bunch of stuff… But at the end of the day, they take people from Point A to Point B.
Sounds like a taxi to me.
What could you do to validate a business like this right now and use technology to help you scale?
I think most people do it the wrong way around. They put technology before the problem and before the customers. First, find out if it’s something people actually really want, and THEN go find a developer on Upwork or Fiverr or Freelancer or ask friends to build the tech for it.
But what's really interesting about Uber is… You don't even need to do the tech part.
You could literally just ask a bunch of your friends, Hey, text me whenever you need a ride and I’ll get you a driver within the next 10 minutes.
And all you have to do is start building up a list of people who know they can get rides from you, and start recruiting drivers to pick them up. You can get them by posting on Craigslist or even on Facebook marketplace!
Now, have you noticed that I still haven't built any tech yet?
I'm just manually solving the problem that people really want.
At some point though, I'm not going to be able to use text to coordinate all the rides. So that’s when technology can actually start solving and scaling that problem.
But you can keep it simple to start!
First, ask yourself…
What's the problem that I'm solving that's not out on the market?
When Chipotle came out, it was super fast, high-quality Mexican food. That’s the problem they were solving. And I know, I think there's lots of other good quality Mexican places out there, but there weren’t any in the mainstream fast food scene.
So how do you actually validate this business idea? Especially if you're a microwave-er like me (I'm not a great chef).
Here’s what I’d do…
Think about it…
What's a restaurant?
It's people eating food, at a place!
If you can get that started with your friends, keep it going until you can't do it at your house anymore. Maybe the second time you do it, tell everyone to bring a +1. And the next time, tell their +1s to bring a +1.
And keep doing it until you get enough people coming over and enough money coming in that you can rent out a location.
That's how I would start it on the cheap.
Yep, I think it’s possible to start a company like Oura Ring with less than $100.
Oura Ring is a sleep tracker. You guys have probably seen a bunch of hipsters and YouTubers wearing it. I really like the company, I wear it almost every single night. I've done it for the past few years.
So how would you start this for less than $100?
First ask yourself, what does it solve?
What it simply did in the beginning was just track your sleep.
So hear me out — I know this is going to seem crazy.
If you want to track people's sleep, what's the simplest way to do it?
You can just watch them sleep.
And I KNOW that's creepy.
You could literally just put cameras on people sleeping. I'm sure that's a little weird but you could record people sleeping and manually track how long they sleep and make some observations from there.
It’s basically a sleep consultation.
People could pay you for it like a monthly subscription service.
And then over time, as you're doing it via camera, you could develop more sophisticated ways to track sleep. Maybe you can develop a sleep tracking mat, or a sleep tracking sound machine, or some kind of wearable sleep-tracking blood pressure detector.
Start small and then scale from there.
|DON'T MISS: My step-by-step guide to starting a business with a day job|
So how would you start a tequila brand?
Would you fly to Mexico? Maybe you’d call George Clooney?
Let's say, I go out there, I source some great Tequila, I bottle it up, etc… But how do I get anyone to buy it?
That's always the hard part.
No matter what business anyone starts — once you have customers, figuring out how to actually source the product is really trivial. A lot of people jump into making the product, spend 6 or 12 months on a website, invest in a domain, in pictures, in advertising, etc.
And then when they launch, they look around for customers and…
So for a tequila business, I would start by thinking about what’s missing from the tequila market. Are you going to be the super cheapest? Are you going to be super luxury? Maybe flavored tequila?? That’s not a bad idea.
Now the next thing I’d do is figure out if can I get any of my friends to buy it.
So I’d ask them! I’d text my friends, “Hey, do you like drinking tequila? I'm making this flavored tequila. It's probably gonna be around $30 a bottle if that's something you're interested in.”
If I could get three people to buy it from me, then I’d figure out how to make flavored tequila. Now that I know I have the customers, actually making the tequila is pretty trivial. Do you think George Clooney's in the fields making tequila?
I actually made coconut wine a year ago.
How did I actually go about making it?
First off I went on YouTube, and looked it up. There’s a ton of people out there showing you (for free!) how to do it.
After I made Version 1, it tasted like toilet water with a little bit of sugar and alcohol. Which was pretty damn cool. But the second thing I did was learn from other people who have already figured it out.
I googled wine sommeliers and I found a bunch of different wineries specifically in Napa Valley (it's one of the best known wine regions in the States) and I contacted a lot of them and I said, Hey, I'm making coconut wine. Can you walk me through how to make this type of wine? I'll pay you $100.
And one guy walked me through the process and I followed up with him over the next few months and finally, I’m on Version 4 now and it tastes pretty damn good.
Another example is Surely wine.
I actually invested $10,000 in this brand.
It was created by Justin Mares and his friends — they also created Kettle & Fire. What's interesting about this is Justin Mares does not know about horticulture, he had never made wine before, and he lives in Austin, Texas. We're not known for wine out here. We're known for country, Texas, and guns.
So what he did is, he did the same thing! He hit up all these wineries in Napa, pitched his idea, experimented with a sommelier guy out there, and finally found one that worked. Then they made big batches and started selling it.
Now, they're doing really, really well.
Also, as you're starting your company, especially if you have a small budget, document your journey!
Make YouTube vids, make a podcast, do a TikTok — whatever it is. Because that's actually how you can build the business. And when you finally have your product ready, you have a customer base that's excited to buy your thing.
To start a social media platform, you probably need an algorithm, right? So that means you’d need a developer. We definitely need a coder for this one, right?
What’s TikTok really solving? Entertainment.
So one way to start it on the cheap is to just send your friends funny GIFs or videos that are short and entertaining.
You could get 10 of your friends and send them one GIF a day and say, Hey, tell me if you like this or not. And each day you keep calibrating based on what they like and keep trying to expand the amount of friends that you're texting
What does that sound like?
It sounds like what Tiktok does. But they just do it every 60 seconds.
And you don't need to build an algorithm to find high-quality content. I would probably go look on Reddit. There's a bunch of subreddits for entertaining content and I’d find ones that people already like and just start building up my audience of friends.
Another way you can start a social media platform right now is through an email list.
You can go to SendFox to start an email list, and then every single day, just send one piece of entertaining content. If it's something that people are opening every day and you’re gaining more and more subscribers, then you can create a platform where people can get customized content based on their interests with an algorithm and stuff.
Again, that's the trivial part.
Make sure to validate it’s something people actually want first.
What's fascinating about the Patagonia story if you read the founder's book is that they wanted rock climbing clothing and there wasn’t anything good available. They ended up taking materials from other departments and other types of products to create their own custom clothing.
There are two key things to think about when starting a clothing brand like Patagonia:
For me, I'm a huge cyclist so I’d think about these things in the cycling space.
What’s a problem I can solve in cycling, and how can I steal concepts or materials from other industries to solve that problem?
First of all, I think the jerseys are ugly.
I don't know if you've seen cyclist jerseys, but I always feel like a loser. So what I do is make stylish cycling clothes. I know there's a company called Giordana that manufactures cycling clothes and they’ll even help you make the designs, so I would start there.
Again, the thing to think about here is what market’s not being served?
So with Gymshark for example, gym clothes existed for a long time — Under Armor, Nike, Reebok, etc. — but they specifically noticed that there's young millennial gym rats that want to look good, and they also tapped into a specific way of marketing (YouTube videos) to actually grow that business.
So Jeremy, our YouTube video producer, used to work with Tom Bilyeu.
I love Tom Bilyeu and I love Quest nutrition bars.
So how could you start this company for really cheap?
What's interesting about this company is they actually DID start for really cheap.
If you want to start any type of protein bar, or nutrition bar, or beverages — a lot of these things are really great home-baked concepts.
All the gym bars that were out there had decent ingredients, but they tasted like garbage. So Tom and his co-founders thought, Maybe we can make something better.
A lot of people would think — I'm not a scientist, I’m not a doctor, or I’m not a nutritionist… But Tom and his wife baked these in their kitchen!
Or you can even outsource it to a co-packer which will make the product for you so you don’t have to invest into any kind of equipment.
But, don’t do all that for a product that you aren’t sure if people want yet. So I recommend making it at home first before you go out and do anything like that.
Let me know what business are you going to start for less than $100 in the comments below!
Join 157,000+ subscribers getting my FREE weekly business tips
Hi I am 21 years old and I’ve been following you for a while and you make it seem so easy! I guess at the root of it it can be but I just can’t figure out how to start. I have this vision of starting a business that sells rock climbing/mountaineering and camping gear sort of like REI co-op. I would also have a fitness center in the back with bouldering walls and crash pads. Right now I am strictly focused on validating selling products and I know for a fact there is a demand in the area (at least for a new climbing gym). I’m having a really hard time figuring out how to start something like this. Do you have any advice how to start? Thank you so much for you time!
I started an ecommerce business in 2016 with almost $0. Okay so I had a computer, an internet connection, a copy of adobe illustrator, a smart phone and about $300 in credit.
Made a mockup of a product a posted it on etsy. The only cost was time to make the image. I then ran etsy ads (you could get up to $1,000 in ad credit back then, so sort of a risk, but I was knocking off a winning product so I knew I'd make some sales and the gross margins on the item were 80%+ before ad cost). Made my first sale in 2/2016. Scaled the business up to $1M+ in sales by 2019 just by reinvesting the cash.
2020+ has been a real punch in the face but re-engineering things and getting back on track. The real tip is to figure out where the demand is, how you can reach it in a specific channel (often a slight variation on where your competitors are) and then, how you can really get a distribution, promise and cost advantages that let you establish your position and enable your ability to continue innovating and growing.
However, beware a business where people like to "play" business. You'll find people are incredibly willing to waste money chasing the title of owning X type of business, thus making the entire segment unprofitable even for the best of operators.
That's super inspiring Mike! Would love to hear more about your story. Is there any social platform where I can with you on?
Leave a Reply