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Start-up Advice

How To Start Your Business With No Budget

Get this right, and you’ll self-fund your business as well.




So, you want to start a business. Let’s assume that you have a great idea for a product or service that you would like to bring to market but don’t have any money for it. Here is a step-by-step guide to get you from idea to launch with limited funds.


We need to determine whether your product or service will sell and the only way to determine that is to do some effective market research. This market research must not only convince you, but others as well, that your idea is workable, solves a problem and that there is a place for it.

How to research your market

The first thing you should do is prepare what I call a marketing map.

  • You do this by writing your idea for the business down in the middle of a piece of paper and then drawing at least four arrows from your product and attaching names of potential customers or groups of customers at the end of each arrow.
  • If you have more than four potential groups of customers, add additional arrows to your drawing. This exercise really focuses you on determining who your market is. Let’s assume you are selling cricket equipment. Your four arrows could then be the general public, schools, other sporting goods shops and exports.

Once you have identified the various marketing sectors you can then prepare a market research action plan for each one and later you can specifically aim your marketing at each particular sector. This is a useful way of thinking through your business and you will gain a lot of information simply by doing this exercise.

Start your market research by:

  1. Writing down what you know about your product. Include industry, major players, special niche and so on.
  2. Google what you can and make notes. If your market is local or for a specific geographical area you can gather information from local associations, such as the chamber of commerce, and you can get out there and ask questions directly to your potential customers.

Market research is a very important part of your process — don’t assume that you know everything about your market, the competition, or your potential customers. While you do your research you will realise that there are many gaps.

Your market research should focus on several key areas, with the following being the most important questions you want answered.

Related: Why You Shouldn’t Quit Your Job To Start A Business


Ask yourself:

  • What problem does this product solve?
  • Why do my customers from the identified groupings need it?
  • What differentiates my product from what is already available?
  • What are the features of my product that make it special or unique and will make people want to buy it?


  • Describe your customer — age, gender, education, income category, location, other factors about the customer.
  • Do this for each grouping as per your marketing map.


  • Identify them and gauge their specific strengths.
  • Do a product comparison.

Critically, your competition has the jump on you as they have an established market. You must go out there and take market share from them. Most importantly, you must get the message out that there is a new game in town. That is not an easy thing to do without money.

Ask yourself:

  • Can you do most of your marketing over social media?
  • Do you need to establish a website?
  • Can you market it through associations or professional networks?
  • What about your brand? It may be worth joining the increasing number of small business associations who, for a membership fee, will assist you with your business.
  • Check out all your options bearing in mind that you must advertise as effectively as possible with limited available funds.

The following represents a basic market research checklist, which should keep you focused and on track. You should keep in mind your customer groupings from your marketing map when drawing up the research.

Market Research: Basic Checklist

1. What industry body exists for your industry?

What information on your market is available from that body.

2. Is there available data on your industry?

Can you get this information from Stats SA, Local Government SA?

3. have you identified a gap or opportunity?

This needs to be confirmed by contacting potential customers and asking them directly about their need for the product.

4. Understand your customers:

This helps to decide on pricing and builds relationships, which increases sales and loyalty.

5. You need to profile your customers:

Describe your customer by characterising them, their spending habits, why they need the product, their location and behaviour.

6. What questions do we ask our customers?
  • Where are they located?
  • Do they already buy the product or service?
  • Do they have a budget?
  • What are their ages and interests?
  • Are there seasonal trends in their buying patterns?
  • Why would they consider buying from you?
  • Would they refer your product to others?
  • Ask them for feedback on your product.
  • Use social media for feedback.

The above should be set up in a scorecard.

7. Is your business location close to your market?
8. You must research suppliers for:

Quality, availability, price, terms, reliability.

Compare using these criteria.

9. Assess your competitors:
  • What is their market share?
  • Assess the quality of their product.
  • Why would customers change?
  • Can you get enough market to be profitable?
10. Social media

Social media is very powerful, and you can get a lot of information from searching the Internet.


opening-a-businessThe price at which you sell your product can be key to your success. Pricing is a very important part of your business.

Remember that:

  • The customer must be happy that he is getting value for the price he is paying, but also, that you, as the business owner, are making sufficient margin to cover your overheads.
  • Therefore, the selling price of your product, less the cost price of that product, known as the gross profit or margin, must be large enough to cover your expenses such as advertising, rent, salaries, travelling expenses etc.
  • If the margin is not high enough you will go out of business because you will have negative cash flow.
  • Not only do you need to make sufficient margin, but your price has to be attractive to the customer and must be competitive.

What is the next step once you have determined that, according to your market research, your product solves a problem and is something your customers want? You need to determine how you are going to go about starting your business and an important question that needs to be answered is, ‘how much money do I need?’

What do you need the money for?

  • Develop the product
  • Source the product — perhaps imported goods
  • Pay for infrastructure
  • Operational costs.

This information goes hand in hand with determining your price point. The best way to determine how much you will need is to prepare a business plan.

Related: Register A Company In South Africa


your-business-planAnyone who is serious about starting their own business needs a business plan. The business plan is the most informative document you will produce, and it will be the basis for everything you do within your business. I don’t buy into the concept of one-page business plans. The idea of a one-page business plan is to keep you agile — you need to look at your plan as a living, breathing document, and not as a huge file on a shelf gathering dust.

There is no business plan that ever met the market and didn’t need to be adjusted. However, it’s essential for you to do the work for a full business plan. You can then distill it into a one-pager to keep you on point — but keep going back to the full plan.

You need to thoroughly research and test the elements of your business, before embarking on operations. Your business plan must be robust enough to stand the rigours of testing.

You need to have:

  • Researched your product
  • Tested the market
  • Calculated the cost of the required infrastructure
  • Determined the price barriers
  • Understood the profitability
  • Calculated how much money you will need to start and run the business.

It’s important to understand that a business plan is not prepared specifically to meet the needs of potential stakeholders such as lenders or investors, but is your guide and enabler. It should cover all the key parts of your business and should be amended and updated as the business grows, or circumstances change.

Related: Business Plan Format Guide

The simple checklist alongside will help you to ensure that you cover all the steps in building your business plan.

It’s not easy to start any business and much harder to do so if you have no money. However, if your business plan is sound you will be able to obtain interest in your business. In most instances it requires a determined mindset with the eye on the medium term. It’s also a blessing in certain instances that money is not readily available, as it allows you to start slowly and have more of an understanding of what is required to succeed. Once the business becomes profitable you can scale it up.

Executive summary
Business objectives and vision
Business description
Target market
Product or service
Legal entity
Location of business premises and market
The business vision
What product or service
To whom are you going to sell
What is the benefit for your customer?
What are your unique selling points/differentiators?
After sales service
Gross profit margin
Protection of your intellectual property or brand
The market
Who is your target market?
Where is your target market?
Why do they want your product?
Who is the competition?
What is the price and is it affordable?
What quantities can be sold?
 Is this a cash or credit market or both?
Infrastructure and staffing
Marketing plan
Suppliers and their terms
Funding the business
Capital expenditure
Purchase of raw materials
Office equipment
Operational overheads
Financial information
Cash flow
Income statement
Balance sheet
Accounting and IT considerations

Related: 6 Resources For Start-ups Looking For Funding


How do I go about finding money to start and run my business? You are satisfied you have a good product that will provide value for your customers.

Your best option would be to:

  • Persuade a customer to give you an order on terms that are very favourable to you. If we refer to our marketing map, our product was cricket equipment and we had determined four customer groupings. One of the groupings was the schools market
  • It would be an idea to approach them individually as to whether they would be prepared to buy from you. If you get a positive reaction, you could put orders together and offer them collectively or individually, a really good deal with perhaps some free articles, or major discounts in return for them paying you upfront or providing you with a deposit.
  • You would then use the upfront payment or deposit to obtain the product and, if you have got your pricing right, cover your overheads for a period of time.

In summary, you need to get an order that will enable you to get the business off the ground and running.

Do this by:

  • Approaching potential customers with your product.
  • Potential customers could also become investors.
  • Keep pressing — you are going to get many no’s before anyone gives you a yes and you may only need one yes to get your business off the ground.
  • What you want to do is structure the terms of the order in such a manner that you are able to buy or produce your product.

Other ideas would be to stay in your current employment and save until you have sufficient money to start the business. You could in the meantime still try to source orders and sell without owning physical infrastructure.

Try to get a supplier to give you extended terms for your first few orders to ensure you get your business started. Suppliers need to get their stock out there and may, under certain circumstances, be prepared to help.

Explore the possibility of crowdfunding, which allows you to take your product to the masses and if they like it, they will wish to invest. The biggest advantage of this is that you remain in control.

If you fail to raise finds via any of these methods, you can resort to more traditional methods.

Finding an investor

This assumes that you would be prepared to give away a share of your business in return for funding.

To find an investor, you need to do several things:

  • Make a list of the players in your industry.
  • Is your product in direct competition with theirs or could it complement their range?
  • Approach each one of them to see if there is any interest in your product.
  • Make a list of equity investors who may wish to invest in your business — these are players who will want to invest to make money from their investment and then exit your business.
  • You will need formal documents, such as a business plan and the back-up detail for them to even consider investing. By giving away a share of your business, you will lose a certain degree of control and you may be required to do more formal and onerous reporting than you would have reasonably considered.

Related: How To Start A Business With (Almost) No Money

Finding a lender

Your other option would be to borrow money. This means that you will need to pay interest and that you will need to ensure your business can make the loan repayments.

To find a lender:

  • Make a list of banks
  • A list of government and quasi- government institutions
  • A list of relatives and friends
  • Note that you will need all the formal documentation referred to above
  • Should you approach a relative or friend be aware that this can be dangerous to your relationship. Ensure that everything agreed to is in writing and that both parties are clear about expectations.


You can start a business with no capital. If you follow this framework, you can gain an enormous amount of knowledge about your product, your market and your competition, as well as what it will take to run a successful business.

As the business owner, you must realise that running a business is a marathon and not a sprint and you may suffer many hard knocks on your way to success.

I am Jon Harding, a Chartered Accountant and have been in the education sector since 2000. I have a love for writing training courses and I have covered various topics such as credit control, how to buy and sell businesses. My real focus is in two areas, being Financial Literacy and Entrepreneurship. I have written a course for entrepreneurs which provides aspirant business owners with all the information, thus giving them the best opportunity to be successful. I can be contacted at

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Start-up Advice

Start-ups Need More Than Money To Succeed – They Need Smart Money

Start-ups need investors who bring not only cash to the table, but also their networks and business acumen.

Max Lyadvinsky




Ask any start-up what the single most important element to success is and – more often than not – the answer will be money. Financing always ranks as a high priority for the small fish trying to make it happen in the big pond of business – but often discussed with less fanfare is where this cash comes from and what will come with it. These are actually the most important details to a start-up.

That is not to say that money is not important. In fact, the second most common reason for start-up failure is lack of funding, according to CB Insights. Although, perhaps ironically enough, the top reason for start-up failure is lack of market need – a problem which could have been identified and avoided by investors who bring money with direction and money with experience.

Start-ups don’t just need money, they need smart money.

Start-ups need investors who bring not only cash to the table, but also their networks and business acumen. Essentially, they bring experience and direction to outfits that are usually inexperienced or directionless. So, let’s talk smart money and the start-up.

What is smart money?

“Smart money” refers to investors who are simply more intuitive and aware of market movements and business health. The Financial Times describes “smart money” as “sophisticated investors who tend to pick the right moment to buy or sell assets because they can identify trends and opportunities before others do.” These investors calculate based on history and profit and invest accordingly. Where they go, other investors follow.

These business heavyweights are invaluable to a startup because they put more than simply their money where their mouth is; they also invest their expertise. A start-up could have all the money in the world but it will fail more without the proper business direction and market placement.

Smart money works best for start-ups when nascent businesses pair with investors who provide a holistic approach to business. They can help in hiring the best talent, attracting interest from the most relevant stakeholders, securing a continuous presence in the press, avoiding pitfalls and, ultimately, fulfilling ambitions.

There are more than a few ways that money can be termed as smart. Perhaps the cash infusion also comes with experts in thought leadership and strategy, or executional capacity, or the ability to increase sales and raise funds. Whatever the method, smart money brings something more to the table than dollars. This becomes abundantly clear when conducting post-mortems of the startups which have failed.

Related: Government Funding And Grants For Small Businesses

Why do start-ups fail?

Start-ups fail all the time – and it is important to understand why. As mentioned above, the top reason start-ups fail is simply the lack of market need. Tackling problems that are interesting to solve rather than those that serve a market need is the most common issue start-ups cite for their downfall. The next most common reason for start-up failure, as likely predicted, is money. Smart or not, money does need to flow into any start-up to make it possible. Meanwhile, the third most common reason for startup collapse was team composition. More to the point: Start-ups need to comprise a diverse team with different skill sets.

These top three reasons for start-up failure could be solved with the right management approach from the top down. Each of these reasons can be addressed with smart money. The right business and management structure will allow the right hires to be made and course to be charted. Smart investors can identify the right people for your team and help you to hire staff who will take the business to the next level.

While start-ups think money is the key, it is not the end-all and be-all for their potential success. They need skills and networks. Business and innovation expert Rosemarie Truman explained this misunderstanding best: “A common mistake entrepreneurs make in their struggle to find funding is focusing too much on getting the money under specific terms and not paying enough attention to who is providing the funds.”

Show me the (smart) money

Savvy entrepreneurs recognise their businesses need more than cash to be successful – especially those at the top. Alibaba chief executive officer Jack Ma, who ranks as one of the richest people in the world, described the need for smart hires and smart staff as thus: “At first, I knew nothing about technology. I knew nothing about management. But, the thing is, you don’t have to know a lot of things. You have to find the people who are smarter than you are.”

Smart business owners want to work with investors who provide not just money but also their expertise, time and access to networks – and this is especially important for businesses looking to scale. The proof is in the research: Take for example a paper by Morten Sorensen, professor of finance at Copenhagen Business School, about venture capital and its impact on an overall business. Sorensen found that companies funded by more experienced venture capital funds were more likely to go public, and also that more experienced venture capital funds invest in better companies, leading to better long-term business health.

So, the question then becomes: Where does one access smart money? The answer will depend on whom is asked, but startups that have survived and later grown into viable businesses are a good place to start. The founders of collaborative blogging platform Niume, Daniel Gennaoui and Francesco Facca, have this advice for start-ups who are on the hunt for smart money:

“First, you need a strong founding team with complementary skills that can actually deliver on their promises. Second, you need a working minimum viable product (MVP), showing that there is traction and interest for the product and people willing to use and pay for it,” the founders said. “The actual amount they invest is far less important than the value they bring to your company.”

It is also worth noting that crowdfunding can be considered a form of smart money, as it brings an ecosystem of partners who will help to scale and countless brand ambassadors who have invested their hard-earned cash.

Related: The DTI Funding Guide You’ve Been Looking For: The What And How

It’s simply more than capital

Gaining start-up finance is not only venture capital or crowdfunding – it should also provide an ecosystem of business management and be viewed as such. It’s simply wrong to think funding is only funding. Start-ups can have all the money in the world but will fail more often than not without the proper business direction and market placement. Those who want to make a lasting impression in their given field need the guidance and support smart money brings.

This article was originally posted here on

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Start-up Advice

7 Lessons For The New Entrepreneur To Take Into 2019

You already have what it takes to make this year successful, but keep these points in mind.

Dr John Demartini




Human behaviourist, Dr John Demartini upacks some important lessons that new entrepreneurs would be wise to take into the new year.

1. Find a need to fill that will also fulfill you as well

First and foremost, the most important thing an entrepreneur needs to do is to find out what exactly it is that businesses or people need, and make sure that this matches what is absolutely most meaningful and inspiring to you.

This need or value that you are going to fill must also be important to you and on your list of highest values so that you have a relentless drive to go and serve this need. In other words, it is important to make sure that you are doing something that’s meaningful and inspiring to you and serves a great number of people.

Related: Awaken Your Entrepreneurial Spirit

2. Clearly define all the functions required to build your business

Those functions are based on exactly what is systems and structures are required to fulfill your customer’s needs or values and to profit.

You must imagine every single step required to serve the customer. This helps build an infrastructure step by step.

3. Meet the need and generate the income

I think a great number of entrepreneurs set up fantasies that they have to depend on money to get their business started. Many have this grandiose idea that they’re going to do this, and then they need a certain amount of capital to get it going, instead of going in and actually meeting a need and generating income and then infusing capital into a proven model.

If you do it that way, then you don’t have to give away portions of your business and accumulate possibly unnecessary debt.  Ask how you can be paid up front to fulfill each essential step instead of how you can borrow to fulfill them. Sure selling in advance is often wiser than borrowing and gambling on what customer might want.

Those who decide to wait for capital before they start their business often feel they can’t get it started without outside capital. Then, a year later they’re still trying to get the capital together to get their business started. It’s often wise to actually make sure you have something that really meets a need and be willing to work from the grassroots up and prove yourself and then infuse capital based on what’s already produced and proven and build it that way.

Related: 7 Character Traits Every Entrepreneur Can Cultivate

4. Manage money wisely

Save a portion of the money earned, and take another portion and return it back into the business to grow it. It’s important to have a liquid cushion – it’s unwise spending all your money or putting all of it back into the business and then having no cushion to fall back on.

Make sure that a portion of the money is put into liquid cash. The greatest companies have a great reserve of cash. Liquid cash is important. Many entrepreneurs are gambling instead of investing and looking for a quick return instead of being patient.

5. Have adequate liquidity to prevent opportunity take overs

Watch out for opportunists – when you are running a successful business. There will be opportunists who come along and offer to purchase the business for much less than it may be worth.  That is another reason to have adequate liquid capital on hand, because without it, you can become vulnerable to others coming in and taking over the business. Leverage buyouts can occur.

Remember, cash is king. Cash grabs opportunities. So be sure to save and invest.

6. Keep focused

If you are not making money, then you must not be serving people. So make sure you are truly meeting your customer’s needs and serving them. Don’t take your focus off your mission. Don’t forget what got you to a point of success.

Related: Make A New Start In 2019

7. Be true to yourself

Don’t try to be somebody that you are not. Don’t envy and imitate other companies, you may end up not being authentic and true to what your values are. It is wiser to recognise where and when you already own the traits of those you admire according to your own highest values.  You already have what it takes.

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Start-up Advice

Outdoor Versus Indoor: How Different Conditions Will Impact Your Budding Marijuana Business

When starting out you should know the difference between indoor and outdoor production and why it matters to your future cannabis business.

Nicole Crampton




If you’re looking to start growing and cultivating a strategy in the hopes that weed will be legalised, you’ll need to do some experimentation. Growing marijuana is a science and will require more than just a splash of water every other day like normal house plants.

Firstly, you’ll need to determine if you can grow your “crop” outside or if you’ll need to set-up a space inside. Here is what you need to know about growing cannabis inside versus outside:

Optimised versus natural

Deciding which option will work better for you depends on your unique circumstances. If you have access to an outdoor area you can use the natural resources of the sun and wind. If, on the other hand, you prefer to grow your crop inside you’ll need to cater for the natural elements you’ve lost, but you can also optimise the environment to give you exactly what you’re looking for.

When growing indoors you can control:

  • Temperature
  • Light source
  • CO2 production
  • Humidity.

This will create a stable habitat for your weed plant to grow in, without having to risk any outdoor elements. Keep in mind, no bulb is going to be able to produce the same spectrum of light as the Sun, which will leave you will smaller yields and less vigorous plants.

You’ll also find it challenging to simulate the natural environment. For example: wasps, ants and ladybugs are natural helpers against mites, you won’t be able to mimic this ecosystem indoors, and if your plants become infested with mites it can be difficult to control. To avoid using pesticides and insecticides some cultivators could find the trade-off of growing outdoors appealing.

Outdoor growers will need a suitable climate for cannabis production such as:

  • Good sun exposure
  • Hot days, warm nights
  • Low humidity.


Related: 6 Fundamental Steps To Consider Before Venturing Into The South African Cannabis Industry

Can you afford to grow indoors versus outdoors?

planting-marijuanaWhether you’re growing indoor or outdoor there will be significant initial costs, however, the difference will come in when it comes to long term costs.

An indoor climate control system can be quite capital intensive compared to outdoor where the majority of the costs are in the initial start-up.

The expected labour costs for indoor and outdoor are also quite different. There is always work that needs to be done to create an optimal environment with indoor marijuana growing. With a smaller yield, like in indoor growing, pruning, trellising, watering, feeding and harvesting are more demanding and continuous.

When growing cannabis outdoors, you’ll work on one crop throughout the seasons. A farm with a large output typically can sustain four full-time workers until harvest, when more employees will be needed.

You can recoup the high cost of indoor weed farming through:

  • Breeding projects
  • Year-round harvests
  • Potent products
  • Higher selling points.

Indoor marijuana farming also allows you to cultivate strains that wouldn’t thrive outdoors.

Pro tip: Keep in mind, with the rising cost of energy and an increasing demand for more product within the current marketplace, outdoor farming could produce quality product at a more reasonable price.


Related: 12 Cannabis Products You Can Legally Start Selling Right Now

Will outdoor or indoor offer you better quality?

Being able to optimise your environment and accelerate breeding has allowed indoor cannabis to hold the title of top of the line product and generate beautiful strains with powerful flavour profiles. With indoor marijuana growth you can increase the CO2 level increasing bud growth and producing higher THC levels, which are difficult to obtain outdoors.

Indoor buds also remain in pristine condition as they aren’t exposed to the elements. Having an indoor operation enables you to harvest crops at peak conditions and curing the product in a controlled climate.

On the other hand, many users prefer the sun-grown organic marijuana. Although the actual plants tend to be more damaged, so the product isn’t as pristine. However, once you’ve gained enough experience you should be able to produce products of the same high quality as indoor growers.


Related: 10 Cannabis Business Opportunities That Can Grow Your Wealth

The best of both options

There has been a growing trend of commercial greenhouse marijuana farming. This seems to capture the best of both methods. It produces high quality cannabis, while using natural elements and optimised environments simultaneously.

Both styles of farming offer positives and negatives, and as a consumer or a future producer, you’ll need to continually educate yourself on the current trends. Continue to evolve your process, try something new and keep your mind open to possibilities.

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