In order to carry out a business venture, most entrepreneurs feel that they must start with a sizable sum of money, often their own personal money. The aim of this business series is to teach budding entrepreneurs simple and practical techniques on how to start your own business with limited funds and limited know-how.
Faith! This is one of the most important values that you must possess. Having faith in yourself will help you through the dark moments that you will indeed encounter along your road to creating your own business. A young lady once went to a “healer” and asked “I am so in the dark, for how long will I remain in this darkness?” The healer paused thoughtfully and in a deep voice replied “Till you can see in the dark, child.” The ability to have full belief in oneself, belief in the product or service he or she is providing as well as the willingness to learn, form the motto of the entrepreneur “Live and Learn!”
The lectures series are based on actual life success stories of young entrepreneurs and are written to be a source of inspiration for you. We sincerely hope that you gain some insight from the solutions offered and find ways to adapt it to suit your needs.
CASE STUDY 1
“When Asking for Help, Appeal to People’s Self-Interest, Never to their Mercy or Gratitude”- Law 13. Robert Greene and Joost Elffers (48 Laws of Power)
Ebuka Anichebe decided that he would like to operate a property website and make life a lot easier for individuals or companies looking to own/rent a house in Abuja. Houses on rent were so few and scattered and most of his target customers were individuals that were too busy to go round town looking for houses for rent from property agents. He had the idea of how he would serve a need to bring homes directly to the customer; however what he lacked were the funds to start the website and market it effectively. It would cost at least N700,000 to get things off the ground.
The Strategy
Ebuka borrowed N100,000 from a relative to start the business, and persuaded a friend to bring up another N200,000 with the incentive to become a partner in the business with 30 percent share interest. He also convinced four of his colleagues to invest in him, in exchange for 100,000 each was promised 5 percent share in profits. He did the legwork and got agencies and landlords subscribed to the website.
The Result
By printing thousands of flyers and bumper stickers to promote the website, Ebuka managed to get a house sold on the site for a whooping N100 million. His agency fee of 5 percent allowed him pay off his debts and buy back shares from the original investors at twice the price within 2 months! He’s currently moved on working on another website that would enable casual home-workers more accessible to jobs from individuals and bigger organizations.
Ebuka was willing to take the risk of entering into a market he knew little about but had a solid idea on what the ideal situation should be. He had very little money but was wise enough to spread the risks by asking others to invest in him. He made family and friends shareholders in the business. Although at first they were skeptical; the sense of ownership of an innovative idea increased their confidence in him. His willingness to do all the hard work paid off with the sale of the first house and him paying back all his debts.
Questions to ponder on:
1. Have you given some thought on how others (family or friends) can assist in spreading the cost of a project?
2. Have you considered ways to make them feel like business angels or like investors from Dragon’s Den and make it seem business-like?
3. Are you ready to do the necessary leg-work and do you have sufficient faith in your products? Faith and a strong sense of belief are what spur investors to part with their money.
4. Have you considered ways to make other people’s risk modest- no more than they can afford to lose?
Tips to get to get you started in spreading the risk:
1. Start with people who know you best and likely to believe in you more. Family, friends and work colleagues would be an ideal starting place.
2. Be honest about the risks but be enthusiastic about the potentials- a brief business plan would be handy sometimes
3. Organize a party doubles as a shareholder’s meeting for all interested investors. Make out fanciful share certificates, monthly or annual reports - the more they seem involved the more they will enjoy the process whether or not they make a profit.
Good luck!
Ebuka Anichebe is the Managing Director of Jean-Paul and Associates Consultancy and an affiliate of Velvet Projects U.K. He specializes in marketing consulting, business development and has an uncommon approach to branding and advertising. Write to him at hello@jeanpaulconsult.com. or call 08064-393-711
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