Tuesday, May 26, 2009

How to Start a Business without Money

Several decades ago, before I got interested in starting businesses, I met a friend who went from being penniless to becoming quite wealthy in a breathtakingly short amount of time. I asked him what the secret of getting rich was.

He said that you should find something that interests you and become an expert. For some reason, he became interested in turquoise and went from knowing nothing to becoming quite knowledgeable about the gem, the various sources, the market, and the players. One thing led to another, opportunities presented themselves and, presto change-o, my friend was showered with dough.

When I started my first business, which was an ice cream company, I had no money, I had no business experience, and I had absolutely no idea how to make ice cream. Five years later, my ice cream was judged to be the best in America by People Magazine. (See April and May 2005 archives of this blog for the whole delicious story.)

What drove the growth of my business was the growth of my knowledge of ice cream. And what drove the growth of my knowledge of ice cream was my love for the stuff.

When you start a business, what must lead the way should be your own interest in or love for whatever it is you want to do. Loving what you do miraculously attracts all the necessary resources, people and opportunities. You definitely don’t need money to start. Bootstrapping will stimulate your creativity and that is worth much more than money anyway.

Besides, money is overrated. I have found through bitter experience that there is always baggage that comes with investors’ money. You take their money and you get their karma too. What may seem like easy money is frequently filled with major headaches and not worth it in the long run. I vastly prefer the freedom and the control that comes with bootstrapping.

But I am also a practical man who like fast-growing businesses. Therefore I have had to take on financial partners of various stripes. I have learned to be VERY fussy about who I partner with. But that is a whole other story.

One more thing: Your passion doesn’t have to be about any particular product or service. For me, my passion is the process – building teams, collaborating with others, wrestling with creative challenges, supplying customers with value, entertaining paradigm-shifting ideas, dreaming of the potential for fast growth, and being socially responsible to all the stakeholders, not to mention Mother Earth. I am passionate about those things, so if all those elements are present, then it doesn’t make a lick of difference if the end-product is ice cream or telecommunications (my second biz and I knew absolutely nothing about telecom either) or whatever.

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