Education from a leading International institution, followed by a career in a world-famous organization, is a guaranteed starter pack for the founding team of every successful startup operating in Pakistan.
Why don’t we see an equal contribution from local graduates? Is it lack of exposure, lack of ideas, lack of direction or the very obvious lack of capital?
Most of our youth hesitates to enter the startup ecosystem due to minimum financial resources. Money undeniably gives you a headstart but by no means is it a prerequisite for a successful startup.
Do Big Dreams and No Cash get you anywhere?
They surely do, given the big dreams are paired with determination, dedication, persistence and a great level of risk tolerance.
Getting investors is a tedious task. Even high revenue-generating businesses have a hard time landing funding essentially in the early stages. The options left are to bootstrap (owner funding) or to opt for something that doesn’t require high capital to launch.
Let’s go through a few such businesses that can be done with minimum to zero early investments.
Service Providing
There is a wide spectrum of services a platform could provide. Ranging from simple data entry services, web and graphic services to licensed consultancy services.
It requires you to find a clientele and gather a skilled team that provides service and gets paid by the client. Such a startup can be started with zero investments and have high prospects of success.
Event Management and Decor
A company that shows a promising portfolio of their plans and designs. The clients pay in advance and once you have a few successful events to your name, you’re good to go. A simple business with no outside or self-funding.
Drop-Shipping
It is a form of retail business in which you take orders from customers and get them delivered through some other shopping platform. This way you don’t require manufacturing, warehousing, or marketing. One platform that gets products delivered from more than one platform.
Online Courses and Teaching
A simple way to start a low-cost startup is to curate lesson plans through videos or other software targeting a particular audience. Provide this learning material through your own platform. As you expand, hire more teachers and course creators to cover a larger spectrum of topics.
Podcasts or Blogs
If you’re one of those curious people who need to know all that is happening around them or the opinionated one always having something to say. The world can benefit from your thoughts and knowledge. Get a mic, share your learnings, talk to great conversationalists and enlighten the world.
You can choose your medium to be podcasts, writing blogs or even storytelling through animations. There exists an audience for everything.
Renting and Hosting
A new concept introduced to us by Airbnb was to rent our houses, rooms or lodges for vacation tourists. It’s a win-win for both the involved parties. You get rent and the tourist gets the real taste of the place they’re visiting.
Similarly, people living up north in Pakistan can convert some of their property to guest accommodation. To make it fancier you can host them at your traditional eateries, festivals and celebrations. This costs you minimal resources yet generate a high amount of money.
Example of businesses that started with nothing
You might be thinking it’s all talks and no action. Well, let us assure you by examples of these highly successful companies that started with little to no money.
MailChimp
It’s a company that makes marketing software for small businesses with its prime product being the e-newsletter service. The company started with zero outside funding and now makes $400 million.
Our very own google itself was created in a dorm room by two Stanford students. The aim was to build a search engine. It was not until much later, Google received substantial funding.
Apple
The $1 trillion valuation giant, Apple, is also an example of bootstrapping by two young founders with the very little they had.
SurveyMonkey
It is the top online survey and polling company started as a part-time project. The team started with absolutely zero investment and raised finances almost a decade after its formation.
GitHub
Github, the central perk for all the developers. The company survived on subscriptions from individuals and businesses for the longest time. It was recently acquired by Microsoft for $7.5 billion.
BaseCamp
BaseCamp is a leading web software company in the USA. The web design firm was having a hard time managing their projects thus developed a project management app that made wonders. The company is currently worth $100 billion.
Indeed
Indeed, the top job-hunting site got started and launched its first product without any outside help. It was acquired at a valuation higher than $800 million.
Shopify
Shopify, the go-to e-commerce service of the current times. It was created due to the unavailability of a well-managed e-commerce platform. The founding duo couldn’t raise venture capital until much later.
eBay
eBay was supposedly a passion project for the founder hence no investments were made. The online marketplace now stands at a valuation of $42 billion.
Lynda
Lynda is a free resource for people interested in learning web design and other skills. They were just a couple running a business with no venture capital of any sort. The company however developed to a great extent and was sold to LinkedIn worth $1.5 billion.
There is one common pattern seen in the founding stories of all these startups. The founders encountered a problem, in absence of any solution available, they decided to develop a solution themselves.
This brings us to a few aspects to strengthen and a few different ways to approach things in order to form a prosperous startup without any investment.
- Automate your life, find digital solutions for your recurring work routines.
- Solve an existing problem by leveraging an existing business model.
- Start today, don’t hold your idea waiting for the right time, start with whatever resources you have.
- Engage is sales-driven businesses, no stored capital is required for such businesses.
Benefits of no investment partners in early stages
Not only is it functional to go on without venture capital but it is preferred primarily in the early stages.
- Your company, your call. You get to build your startup according to your plans. When an investor finally come on board, the company has set its identity and the coming investors work around it.
- Probability of raising a higher amount increases when the company has made its name in the consumer market.
- An increased risk tolerance.
- Pivoting as per the market’s demands is easier.
- Tight deadlines and performance pressure create unnecessary stress limiting creativity.
- Investment can accelerate growth, but not the product. Early-stage requires to focus on the product altering and updating with feedback.
We think that’s enough convincing to make the point that a startup can very much succeed without initial investments. It is a matter of finding a problem affecting many and creating the right solution preferably through digital means.
Do you have a great idea? Get started now! Maybe your company will be the next big thing.