Starting a Business on a Limited Budget – Seed Academy’s Donna Rachelson’s Plan
Can you start a business with limited funds? If you brand yourself well and use your funds wisely, says Donna Rachelson – a driven entrepreneur, investor and branding and marketing specialist with a passion for helping women, corporate go-getters and entrepreneurs make their mark.
Here is Donna’s plan:
Every year, we run The Real State of Entrepreneurship Survey and every year, our findings show that the South African ecosystem remains difficult for entrepreneurs to navigate. 88% of the surveyed business owners are self-funded, with a third of them of having needed less than R10 000 to get their idea off the ground but all of them agreeing on the top three challenges – finding customers, raising funds and focusing on too many things at once.
With minimal money at entrepreneurs’ disposal, the question that begs answering is how much funding do you need to be your own boss and what should you be doing with it to get the biggest bang for your buck?
Start with the skills
Could limited funds give you the kickstart you need to make your business a reality? In my opinion, yes – but you’d need to be very clear on your plan of action – and it would need to be strongly focused on marketing, networking and business development as these are the skills that continue to hold our country’s entrepreneurs back.
Nail the idea
I’d start by choosing one big idea, a product or a service, that differentiates you from the rest.
There has been a strong shift towards service-orientated businesses in recent years but if you head down this road, make sure your offering is competitively unique and can easily generate an income.
If you choose to offer a tangible product, ensure that it is something simple with limited variations – you don’t want to have to spend all your money on lots of stock that you may not be able to move or have to pay storage for. You’re looking for something easy-to-source and easy-to-ship.
Take it online
Next up is to make your offering accessible online – this is the cheapest, fastest way to reach the most people. Remember though, your funds can only take you so far.
Then start marketing it aggressively
Consistently marketing one big idea over a plethora of complicated options will ensure you maximise your impact rather than leave your customers confused and indifferent. Ensure you have a professional brand identity and then religiously replicate this across all of the top social media platforms and if you can afford it, your own e-commerce website.
And connecting with your customers
When it comes to the image you and your business portray to the world, remember that both are important but that potential customers want to get to know the face behind the brand. Gone are the days of being able to hide behind a strong corporate logo or successful product range – people want credible advice and authentic endorsements. Actively cultivating what you stand for puts you in control of influencing your network and ultimately, converting your leads into sales.
The goal is to build a network
Online advertising will help you to gain a following and a social media content strategy will enable you to keep your potential customers engaged – but most importantly, developing your network comes down to building mutually-beneficial relationships that you can quickly tap into. This means choosing who to know and how to look after them and often, requires more ‘give’ than ‘take’ to build a reserve of goodwill that you can later draw from – be it in the form of influential testimonials, sales or further business funding support.
Finding success on a budget
There are many worldwide examples of entrepreneurs who have rocketed to success by starting small, keeping their expenses low, using the internet as their sales platform and most notably, prioritising relationships and service above everything else. In our very own backyard, we can look to YuppieChef, NetFlorist, Superbalist and Nic Harry – who actually started out with only R5000!
Just keep in mind that for many, failure and learning are part of the journey too. It may take a few brilliant ideas to catapult you into the limelight – just be sure not to fail too slowly and throw too much money at a single idea. Rather, fail ‘fast and forward’ – letting go of what is not working and putting your learnings into practice so that you can build something even bigger.
Ultimately, there is nothing holding you back from being the next South African phenomenon – if you cultivate a strong brand and use your funds wisely to market yourself and your business, the world is literally your oyster, thanks to the internet.