A new Yell Business research shows that 40% of small businesses launched in the UK were started with just less than £500 – No more losing sleep over startup costs.
The survey of 1,500 SME’s also revealed that a further 32% started with £250 or less, with 93% of these businesses turning over profit in the last year.
Despite most entrepreneurs citing lack of funds as the ‘biggest barrier’ to starting up, the report points out that ‘going it alone’ can be successful without huge loads of money.
As a result of this, we asked these CEO’s to share with us their business launch story with only less than £500 in their pocket:
Frances Bishop, Founder, The Pud Store
The Business - A discounted boutique store for children Launched Date - 2014 Startup Cost - £200
“I started The Pud Store with just £200. With no experience at all in fashion or retail, I had an idea to sell discounted children’s designer clothing but didn’t really have a clue where to start. Then fate stepped in and a clothing agent for a designer brand got in touch to say he was selling his samples.
I remember meeting him in Leeds and I withdrew £200 from the cashpoint in a petrol station. I handed it over and The Pud Store was born. I sold the stock on Facebook at first, it sold out within 2 weeks and I had made £300 net profit.
I reinvested in and grew from there. Almost 3 years later I have lots of suppliers, a loyal customer base, two retail shops and turning over half a million a year and still growing.
Rather than starting with large amounts of funding, it’s best to almost test your idea with a small amount of money before taking the plunge. I realised early on that my concept would work with very little investment.
Often knowledge and enthusiasm work much better than five figure investments. If you do decide to seek additional funding make sure you approach the bank with a sound business plan and know exactly how you can repay the money.”
Sam Boothroyd, Director, The Small Business Coach
The Business - An online business coaching service Launch Date - 3 Months ago Startup Cost - £450
“As a business coach and someone who has set up and sold a couple of businesses in the past, I should be able to set up a business on a budget otherwise I wouldn’t be very good at my job. I started my coaching business with £450 and automatically set aside £250 for advertising.
That left me with £200 to get started – I set up a website through GoDaddy for £10 a month and only used free plugins. I taught myself to create the site (easier than you are led to believe) with youtube videos and used a fee mobile app to create the logo.
I am fortunate enough to have been through the process in the past with my first business so I knew where to get deals. I signed up for Adobe Premiere Pro for £16.44 a month and paid £35 for some decent software to use my laptop to create videos. Everything else was just my time creating and editing the video lessons.
Eventually launched the business and spent my £250 on Google Adwords to start the business on making a profit.”
AJ Sharp, Founder, Sharp Relations
The Business - A food and drinks PR agency Launch Date - 2010 Startup Cost - £80
“So I started my business from a desk at my parents’ home. I made a deal with them that I could live rent free for 3 months to help me to keep my costs as low as possible. Then after 3 months, I had to pay half rent and after six months I would be on full rent. That kept my overheads very low.
I already had a laptop and an old little printer, which did the job and if I needed something in a presentation quality then I would use the local print shop. As my business is communications based, it was necessary to be connected to a phone line and be able to access emails through my laptop. I was lucky to have internet at home and I used my mobile phone to hotspot.
I had to pay £30 to set up a website through One.com, which included 1 years hosting and a template for a small website. There was mail administration, which allowed me to create domain appropriate email addresses.
Once I was up and running, I started looking much more professional and had something to put on my business cards. The first ever set I designed and printed through Vista print cost me about £30 delivered. I was then ready for the food shows and exhibitions.
The last £20 was a return train ticket to a London based food show where I picked up two clients – 1 of which I still work with now 7 years later and another one that I still do projects for whenever they need me.”
Ben Michaelis, Founder, ThinkEngine Ltd
The Business - A commercial digital marketing agency Launched - August 2015 Startup Cost - £100
“I’m someone who likes structure and planning, and although it isn’t ‘the be all and end all’, it really helps to get into the right mindset.
New businesses won’t come to you until you have a respected reputation. Those who think that the self-employed life is a breeze should be prepared for the worst, this is a tough and long-term opportunity for you to succeed.
I started my business by cold calling local businesses who may be looking for marketing support. I was fortunate to book two meetings after making 50 calls and both became my clients, which gave me the springboard to grow my business.”
Rebecca Newenham, Founder, Get Ahead VA
The Business - A virtual assistant Launched - 2010 Startup Cost - £100
“After a career in corporate buying for retail giants Superdrug and Sainsburys I had lots of great contacts. All I needed to get started with my virtual assistant business was a laptop and I managed to pick up a second hand one for just £100.
I asked a friend to design my logo and did various skill swaps to begin with to get the business going. I invested my time in attending local networking meetings to spread the word about what we could offer.
At the start, I built the business through local networking – as well as using social media. My first client was a referral and word of mouth has definitely been a major source of new business over the years. Despite us living in such a digital world, personal recommendations – and personal relationships – still really make a difference.”