Did you know that most new businesses are started with personal savings? That’s right: many entrepreneurs get started without loans or investments, using their own savings and gradually reinvesting profits as the business grows. This raises a natural question: what kind of business can you start from scratch with minimal investment? There are many options — the key is to find your niche and get started.
What business to start from scratch
“Starting from scratch” doesn’t mean starting completely without money or coming up with a unique idea that has never existed before. It’s about launching a business with minimal external investment, relying on your own resources: knowledge, skills, time, and experience. The goal of this approach is to create a sustainable business that you fully control and that solves real market problems.
Launching this way can be the best solution for several reasons:
- Lower risk. You control your startup costs and can scale gradually.
- Full control. You make decisions independently, without being tied to investors or lenders.
- Idea validation. You can test demand and confirm that your product or service is needed.
- Quick decision-making. Less bureaucracy allows you to react quickly to market changes.
- Easier to attract future funding. A running business with a track record is more trustworthy to investors and banks.
6 steps to starting a business from scratch
If you’re wondering what business to start, this guide will help you navigate the path from idea to your first customers.
Step 1. Start with an Idea
Choose a field that you’re interested in and where you already have skills. This approach simplifies the launch and reduces initial costs. For example, in the service industry (consulting, tutoring, design), your personal time and expertise are often all you need.
To initially develop your idea, use a simple one-page business plan: it will help you understand how the business will work and how revenue will be generated.
Examples of businesses you can start from scratch:
- Freelance writing and copywriting.
- Making handmade goods.
- Tutoring and online teaching.
- Web design.
- Virtual assistant services.
- Landscape design.
Step 2. Check market demand
A good idea isn’t enough. Before deciding what business is best to start, make sure there’s an audience willing to pay for your product or service. Identify your target customers, study their needs, and confirm there’s real demand.
Talk to potential customers, ask questions, identify their “pain points,” gather feedback, and adjust your concept if necessary. You might even make your first sales at this stage.
Step 3. Assess your available resources
Be realistic about what you have. Personal savings are the most convenient source of funding because they allow you to maintain full control over the business. If needed, you can seek small contributions from family or partners.
Also, consider whether you need a partner to cover your weak spots — for example, in marketing or operations. Don’t forget about professional contacts and mentors: their advice can save you time and money.
Step 4. Create a business plan and financial projections
Document your business model and key development stages. Prepare initial financial calculations, including:
- Startup and recurring expenses.
- Expected income in the first year.
- Cash flow.
This data doesn’t have to be perfect, but it will help you plan your path to profitability. Regularly review your calculations and adjust your strategy as the business develops.
Step 5. Register and protect your business
To reduce risks, it’s important to legalize your operations. For an entrepreneur in the US, this usually includes:
- Registering as a sole proprietorship, LLC, etc. The choice of entity depends on the scale and specifics of your business.
- Licenses and permits. Check if they are required for your industry.
- Choose the appropriate tax structure and report your income on time.
- If possible, get liability insurance, especially in the service industry.
- Use written agreements with clients, partners, and contractors.
Step 6. Promote and manage your business
In the beginning, you can run your business alongside your main job. Create a simple website, set up a payment system, and establish basic tools for working with clients.
For promotion, choose channels where your target audience is already present. This could be social media, email newsletters, referrals, and partnerships. Start with small budgets, test your hypotheses, and only increase your investment when you have confirmed results.
