I’m going to veer from my usual geek/parenting posts to talk about starting a business without spending any money or taking on any debt. This is geared toward retail and craft business, but I think some of the principles could apply to any business.

My Business Background

I started Three Muses Inspired Clothing in 2005, after selling a bunch of my old costumes on eBay and discovering there was a market for what I do. By 2007 I quit my regular job and went full time with the costume business. In 2009 I opened a retail boutique, which I ran for 7 years.

During that entire time, I was never in debt, I didn’t even owe money on a credit card. My business did well because I started with a good foundation. When I closed in 2016 it was because I wanted to focus on my family and new baby. And I knew if I wanted to do it again, I already knew how to get it started.

This isn’t an overnight solution. It’s a long-term method for people who are ready to get started working toward their goals instead of just talking about them and dreaming.

How I Started My Business Debt-free

1 Forget about a business plan for now.

Business plans have their place and may become necessary, but they can also hold you back from getting started. There are plenty of things you can do to get the ball rolling and develop a full business plan later.

If I had sat around trying to write a business plan, then I may have never gotten started. My plan looked something like this: Make things, sell them, open store, sell more things. Just know what you want to do and start doing it in some small way.

2 Stop asking for money and start earning it.

When I went to the Small Business Administration for guidance, I was the only one in the room with 20k in the bank and actually ready to start a business. Everyone else was there to find out how to get small business funding and apply for loans.

Now everyone wants to get quick money with crowdfunding. What happened to earning and saving for something you want?

Crowdfunding platforms like GoFundMe and Kickstarter are actually great ways of raising funds if you absolutely need cash before you make anything to sell.

When I wanted to self-publish my children’s book, I did a GoFundMe where I pre-sold the book at different levels and included bonuses with larger donations.

3 Start selling on eBay.

This is where it becomes more craft specific, because you’d usually already have things ready to sell that you’ve made. If you are in another type of business, think of something related you can sell on eBay or a similar platform to generate income.

Price it to sell. I sold my old clothes and costumes and then when I ran out of costumes, I started pulling old clothes out and transforming them into costumes to sell. I also sold a lot of extra junk I had around the house. I started with eBay because it’s easy, you already have a ready audience, and it doesn’t cost anything unless you sell something.

4 Open a PayPal account and use it only for business.

I recommend a Paypal account, because you don’t have to have your business all set up and it’s easier than opening a business bank account. Also, most online sales take Paypal, so all sales go into the account and any purchases for the business should come out of that account, not your personal bank account.

Later, you may be opening other accounts for things like banking and insurance, as well as looking for an ach processing company to help manage the business’s finances.

5 Reinvest that money into the business.

You can start paying yourself later, but at first, take the money you make and reinvest it into your business. Only spend the money you have. If you use a credit card, only spend what you can pay off in full at the end of the month.

6 Use this time for business research.

While selling on a small scale, pay attention to what sells, what’s the best pricing, how to ship, dealing with international sales, etc. You can learn a lot along the way and be ready when you fully launch.

7 Make it legal.

When you move out of hobby mode and actually start making enough money to call it a business, then get legal. You can visit your local SBA for help on this.

They will let you know what you need to do (business license, Tax ID, zoning, etc.) to get started. You’ll also need to choose your business structure: Sole Proprietor, Corporation or LLC. The certificate of incorporation is issued by the government if you want your business to be considered a corporation.

Once you have all the legal stuff squared away, you can open a business bank account. You may also want to look into getting an accountant or lawyer like Stone Rose Law in case you have any legal issues or questions that you need help with along the way.

8 Create your own store.

When you have your own customer base then move to your own website and continue crafting your brand. I recommend using Shopify. I’ve had two stores with them, and they have a lot of options for customizing and add-ons.

9 Promote the hell out of yourself.

You can promote without spending a ton of money on advertising by using social media like Instagram and Facebook.

When I created my business, social media wasn’t really a thing yet, so I went out and got involved in the community.

I made costumes so I dressed up and went to conventions and handed out cards. I promoted my product by getting out and being seen and photographed wearing it.

10 Keep saving and reinvesting.

Make regular deposits from PayPal to your business bank account. Once you’ve saved up enough, start shopping for a place to open your store. (Or do whatever big business move you were saving up for) Congrats, goal achieved!

The unique thing about starting a business this way is that you should already have a successful web business by the time you make a big leap or big investment, so you have a safety net. My website floated my store for the first year, then things evened out and by the end the store outsold the website.

This is a totally unconventional method, but it worked for me so I figure it could work for others too. I wanted to share since I see so many people wanting to start a business but not making progress because they are too busy just looking for funding. It’s more rewarding to start working toward your goal and fund it yourself.

Unless you need like a million dollars to get started building jumbo jets or something. Then yeah, you should probably start looking at funding and investors and make a business plan! lol.

Good Luck! And if you have a small biz you are trying to get going, feel free to advertise yourself in the comments 🙂