How to Start a New Business With $20 or Less

How to Start a New Business With $20 or Less
  • Opening Intro -

    It can cost at least $250,000 to launch a franchised business, but there are some business models that can be started with little to no cash.


Virtual assistants, freelance writers and pet walking services have sprung up with these owners having little more than two nickels to rub together. For no more than $20 you can launch these businesses and select others, provided you follow the steps as outlined herein.

1. Establish your business model. No business can be run without some investment in capital or equipment. If you already own a lawn mower, then you can cut a neighbor’s grass. You just need money for gasoline and oil to get you started. For a freelancer, you need to already own a computer and have an Internet connection. Certainly, you could use a public computer at the library, but for a basic level of control you need your own equipment.

2. Know the law. Certainly, there may be legal requirements to launch some businesses. If you have a product to sell, your state may require you to obtain a business license and begin collecting sales tax. A business license means filing your articles of incorporation; you will pay hundreds of dollars to get started, so this option is not for the low-budget entrepreneur. Find out what types of business can be started with scant resources and where a formal business establishment with the state is not required initially.

3. Develop a business plan. You may think that you can launch an enterprise without a cash outlay, but quickly learn that this is not possible. Develop a business plan based on free samples available online such as found on or on select university websites. That plan can guide you through the start up process and identify areas where you might need to spend a few dollars to get going.

4. Launch a website. At this point, you will need to spend some money. Shop around and you will be able to buy your first domain for a dollar or two and your first month of web hosting for about $5. A rudimentary understanding of web design is necessary, but if you use an open source program such as WordPress, you can download what you need for free and set up your pages accordingly. If you are not particularly adept at web development, then barter your services to get what you need done.

5. Spread the word. Marketing can cost you, but you can get the word out without costing you much money. If you need business cards, you can get a few hundred printed for free. The only cost to you is shipping and handling fees that may run you about $10. The remainder of your start up marketing can come from word of mouth with your newly minted business cards giving interested people your contact information. Sign up from free Twitter, Facebook and Google+ accounts to start connecting with people and building your fan base.

6. Barter for services. In our fourth point we touched on bartering for services. Keep in mind that the IRS requires that taxes be paid on certain bartering services. Those taxes, however, may not be due immediately, enabling your business to get started with a small cash outlay. IRS Form 1099-B must be filled out and submitted with your taxes. You can barter anything provided that the services you need can be exchanged for something that you need. Those needs include website design, logo design, coding and marketing. Consider what you can give in exchange and then barter away.

7. Get started. Your start up costs are just under $20 and you are ready to launch your small business. Certainly, your expenses will grow as your business expands, but your initial cash outlay was quite small. To move to the next level you may need to spend more money, but to start off your $20 may be more than enough to launch your enterprise.

Business Considerations

What business do you want to start with very little money in your pocket? Besides the three mentioned, you may be able to start a childcare business or a consulting service with the smallest initial outlay. Always follow the legal requirements when launching your business and seek out professional assistance or mentoring as you need it.

See AlsoBusiness Buying: Qualifications Needed


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Categories: Small Business

About Author

Matthew C. Keegan

Matt Keegan is a freelance writer and editor as well as publisher of "Matt's Musings", his personal blog. Matt covers campus, consumer, business and financial topics on various websites and blogs, and has been published in the "Houston Chronicle", "Sam's Club Magazine" and "Wisconsin Golfer".