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How An Entrepreneur Makes Money When They Don’t Have Any

How An Entrepreneur Makes Money When They Don’t Have Any

I understand what it’s like, I’ve been there myself, you have all of these big ideas that you know would work, make millions, go viral and so on, but you simply don’t have the cash to push them through. It’s frustrating, finding investment is hard, and you feel as though you’re in a vicious circle that you’ll never get out of.

But there’s hope! To make money when you don’t have any, you have to do two things.

1. Scale Down

Number one is scaling down. When you don’t have enough money, you need to have a certain mindset that can take you from location A to location B.

This mindset is made up of acceptance and compromise. Accepting the fact that you can’t go out and spend thousands on advertising, then compromising to find a scaled down version of what you originally wanted to do.

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This is where most people struggle because they aren’t willing to put out what they would call a…bad product/service. But for anyone who’s read the book The Lean Startup by Eric Ries, you’ll know where I’m coming from. For those of you who haven’t, I recommend reading it.

The Lean Startup talks about your MVP – Minimum Viable Product. This is a version of the product or service that requires the least amount of time and money spent but still does the job in a minimalist way. What’s the point in spending thousands on a new idea if you haven’t tested it yet, or worse, spending thousands of hours and wasting time you can never get back?

This is why sometimes, the one with the least money comes out on top. Having too much cash can be a burden, it makes you reckless and somewhat lazy. You begin to believe that flooding money into your idea will automatically make it work, but it doesn’t quite work this way.

Example:

Some of the best companies in the world were started from the absolute bare minimums. Take James Dyson for example. James was an inventor, had some ups and downs, but was fairly stable. There came a time in his life when he didn’t have too much cash to play around with. He had a big idea, yet couldn’t implement it.

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Instead of giving up, James turned to the MVP system and created a hoover out of a cereal box. (I’d love to tell you how). He hoovered the entire house twice and realized that his cheap product worked. This was step one complete; he worked with what he had where he stood and came up with something that could take him to the next step.

The Takeaway

I see so many people complaining about not having enough money, yet they haven’t even tried the basics. A world class website straight out of the gate isn’t realistic, but don’t worry. Just having something in place, a platform to build from is the most important factor. You can improve as you go, learn as you go and enable the business to move in parallel with your growing profits.

This system works very much like video games. You can afford better things and be granted access to more exclusive items/opportunities the longer you play and the further you advance. You don’t put the disk in and complete the game in 5 minutes with everything available to you.

Progression is progression, no matter how slow you go or from where you start, all that matters is that you’re moving.

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2. Be Creative

The second component is being creative. Instead of following a single given path, you need to search for ethical shortcuts, tricks, and opportunities that no one else spotted.

You see, if everyone is after the same goal, reading the same material and learning from the same companies, there will come a time where nothing differentiates you from your competitors. Being different, thinking differently and running as far outside of the box as you can definitely work in your favor when you’re broke.

Example:

Richard Branson may be the king of this strategy. When he first started out in business, before all of the billions, he too had similar issues in the financial department as I guess many of the people reading this have today. He needed sponsors for his new magazine, but of course, no one wanted to be associated with a new brand that had a small readership, no history, or proven results.

So what did Richard do?

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He contacted the biggest company that would get on the phone with him and told them that they could feature in his magazine for free with a double page spread. No catches, just a free advert that would point customers in their direction with no risk or money to be paid. The large company obviously said yes because they had no reason not to, it was free adverting.

So how did this benefit Richard?

Richard then went to smaller companies and showed evidence of this large company featuring in his magazine. To them, it seemed as though the larger company had bought a double page spread. Without hesitation, they all began signing up to Richard’s magazine and paying him for a feature. They must have thought, “If such a big company is doing it, then they must know something we don’t.” He used a form of social business proofing!

This cost Richard nothing but made him the money he needed to reach the next stage of his entrepreneurial journey. A simple creative thought that, for all we know, could have been the catalyst towards his billion-dollar fortune.

The Takeaway

Sometimes it’s the smallest, most simple and most overlooked features that can make all the difference. Having money is great, of course, it opens up opportunities, but there’s something about working with a small budget that heightens your senses, makes you hyper-aware to opportunity and more selective in how you spend what you have.

If you’re broke but have a great idea, never forget that you have the start-up advantage, something that larger companies have been trying to get back since they grew.

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Published on November 20, 2018

The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

The truth is, there are many “money saving guides” online, but most don’t cover the root issue for not saving.

Once I’d discovered a few key factors that allowed me to save 10k in one year, I realized why most articles couldn’t help me. The problem is that even with the right strategies you can still fail to save money. You need to have the right systems in place and the right mindset.

In this guide, I’ll cover the best ways to save money — practical yet powerful steps you can take to start saving more. It won’t be easy but with hard work, I’m confident you’ll be able to save more money–even if you’re an impulsive spender.

Why Your Past Prevents You from Saving Money

Are you constantly thinking about your financial mistakes?

If so, these thoughts are holding you back from saving.

I get it, you wish you could go back in time to avoid your financial downfalls. But dwelling over your past will only rob you from your future. Instead, reflect on your mistakes and ask yourself what lessons you can learn from them.

It wasn’t easy for me to accept that I had accumulated thousands of dollars in credit card debt. Once I did, I started heading in the right direction. Embrace your past failures and use them as an opportunity to set new financial goals.

For example, after accepting that you’re thousands of dollars in debt create a plan to be debt free in a year or two. This way when you’ll be at peace even when you get negative thoughts about your finances. Now you can focus more time on saving and less on your past financial mistakes.

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How to Effortlessly Track Your Spending

Stop manually tracking your spending.

Leverage powerful analytic tools such as Personal Capital and these money management apps to do the work for you. This tool has worked for me and has kept me motivated to why I’m saving in the first place. Once you login to your Personal Capital dashboard, you’re able to view your net worth.

When I’d first signed up with Personal Capital, I had a negative net worth, but this motivated me to save more. With this tool, you can also view your spending patterns, expenses, and how much money you’re saving.

Use your net worth as your north star to saving more. Whenever you experience financial setbacks, view how far you’ve come along. Saving money is only half the battle, being consistent is the other half.

The Truth on Why You Keep Failing

Saving money isn’t sexy. If it was, wouldn’t everyone be doing it?

Some people are natural savers, but most are impulsive spenders. Instead of denying that you’re an impulsive spender, embrace it.

Don’t try to save 60 to 70% of your income if this means you’ll live a miserable life. Saving money isn’t a race but a marathon. You’re saving for retirement and for large purchases.

If you’re currently having a hard time saving, start spending more money on nice things. This may sound counterintuitive but hear me out. Wouldn’t it be better to save $200 each month for 12 months instead of $500 for 3 months?

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Most people run into trouble because they create budgets that set them up for failure. This system won’t work for those who are frugal, but chances are they don’t need help saving. This system is for those who can’t save money and need to be rewarded for their hard work.

Only because you’re buying nice things doesn’t mean that you’ll save less. Here are some rules you should have in place:

  1. Save more than 50% of your available money (after expenses)
  2. Only buy nice things after saving
  3. Automate your savings with automatic bank transfers

These are the same rules that helped me save thousands each year while buying the latest iPhone. Focus only on items that are important to you. Remember, you can afford anything but not everything.

How to Foolproof Yourself out of Debt

Personal finance is a game. On one end, you’re earning money; and on the to other, you’re saving. But what ends up counting in the end isn’t how much you earn but how much you save. Research shows that about 60% of Americans spend more than they save.[1]

So how can you separate yourself from the 60%?

By not accumulating more debt. This way you’ll have more money to save and avoid having more financial obligations. A great way to stop accumulating debt is using cash to pay for all your transactions.

This will be challenging, depending on how reliant you are with your credit card, but it’s worth the effort. Not only will you stop accruing debt, but you’ll also be more conscious with what you buy.

For example, you’ll think twice about purchasing a new $200 headphone despite having the cash to buy them. According to a poll conducted by The CreditCards.com, 5 out of 6 Americans are impulsive spenders.[2]

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Telling yourself that you’ll have the discipline to not buy things won’t cut it. This is equal to having junk food in your fridge while trying to eat healthy–it’s only a matter of time before you slip. By using cash to make your purchases, you’ll spend less and save more.

A Proven Formula to Skyrocket Your Savings

Having proven systems in place to help you save more is important, but they’re not the best way to save money.

You can search for dozens of ways to save money, but there’ll always be a limit. Instead of spending the majority of your effort saving, look for ways to increase your income. The truth is that once you have the right systems in place, saving is easy.

What’s challenging is earning more money. There are many routes you can take to achieve this. For example, you can work long and hard at your current job to earn a raise. But there’s one problem–you’re depending on someone else to give you a raise.

Your company will have to have the budget, and you’ll have to know how to toot your own horn to get this raise. This isn’t to say that earning a raise is impossible, but things are better when you’re in control right? That’s why building a side-hustle is the best way to increase your income.

Think of your side-hustle as a part-time job doing something you enjoy. You can sell items on eBay for a profit, or design websites for small businesses. Building a side-hustle will be on the hardest things you’ll do, be too stubborn to quit.

During the early stages, you won’t be making money and that’s okay. Since you already have a source of income, you won’t be dependent on your side-hustle to pay for your expenses. Depending on how much time you invest in your side-hustle, it can one day replace your current income.

Whatever route you take, focus more on earning and save as much as possible. You have more control than you give yourself credit for.

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Transform Yourself into a Saving Money Machine

Saving money isn’t complicated but it’s one of the hardest things you’ll do.

By learning from your mistakes and rewarding yourself after saving you’ll save more. What would you do with an extra $200 or $500 each month? To some, this is life-changing money that can improve the quality of their lives.

The truth is saving money is an art. Save too much and you’ll quit, but save too little and you’ll pay for the consequences in the future. Saving money takes effort and having the right systems in place.

Imagine if you’d started saving an extra $100 this next month? Or, saved $20K in one year? Although it’s hard to imagine, this can be your reality if you follow the principles covered in this guide.

Take a moment to brainstorm which goals you’d be able to reach if you had extra money each month. Use these goals as motivation to help you stay on track on your journey to saving more. If I was able to save thousands of dollars with little guidance, imagine what you’ll be able to do.

What are you waiting for? Go and start saving money, the sky is your limit.

Featured photo credit: rawpixel via unsplash.com

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