I get pitched to by entrepreneurs every day when I’m travelling. It happens in restaurants, lifts, and even on the Tube. I don’t mind at all, in fact, I thrive on it. I get energy from hearing passionate people sharing their ideas that they think will change the world.
A lot of these impromptu pitches tend to end with, “I need x amount of money to get started.” There’s no doubt it can be easier to achieve lofty ambitions if you already have financial backing, but in many cases, you don’t need lots of money to start a business.
I started my first business when I was still at school – Student Magazine. It was created to provide an alternative to the stale school magazines and protest against the Vietnam War. I was just 16 years old when I founded the magazine and had no money to put towards it. At the start of the summer holidays, my co-founder Jonny Gems and I moved into the basement of his parents’ house and set about creating the first edition.
As with many start-up stories, mine had humble beginnings. The basement was dark and dank and we were always hungry. One day, my mum came to visit. She had found a necklace on the road near home and had handed it to the police. When no one collected it after three months, the police told her she could have it, and she sold it for £100 – about £500 in today’s money – and gave it to us.
That £100 paid off our telephone and postage bills and kept us going for months – without it the business would have collapsed. The magazine became hugely popular and we eventually started selling records via mail order through the magazine, and so Virgin Records was born. That £100 ended up paving the way for Virgin Galactic, Atlantic and all the other Virgin companies around the world today.
We didn’t need lots of money to start our first business and that’s even truer today than it was back then. Customers are just as happy to buy from someone based at home as they are from a business on the high street. This brings the cost of starting a business down dramatically. Rather than commit to pricey premises you can set up online with no technical expertise using a website builder, and start selling from your kitchen table.
It’s also the best time there’s been to get funding to start a business. Raising finance to start a business from a bank has gained a reputation for being difficult, but today you can bypass this altogether with schemes that are dedicated to helping entrepreneurs launch, such as crowdfunding or Start Up Loans.
At Virgin we have an organisation working to support entrepreneurs in the UK when they’re getting ready to launch and grow. Virgin StartUp is the not-for-profit home of entrepreneurship for the Virgin brand – since launching in late 2013 they’ve supported thousands of entrepreneurs in the UK to start-up, distributing over £35m of Start-Up Loans in the process. Through working with these entrepreneurs they’ve seen first-hand what great businesses can blossom from a small amount of funding.
To prove you don’t need big budgets to launch a business, the Virgin StartUp team are launching The £500 StartUp Bootcamp. This three day accelerator, delivered over three weeks, which will show entrepreneurs how to turn their business idea into reality using only a £500 Start Up Loan – the same amount it cost me to start Student Magazine.
On the accelerator, you will learn from in-house experts who will guide you through exactly how to start your business on a shoestring. The team will also cover the fundamentals of a business plan and creating a set of business financials.
Our magazine for students which started with £500 led us to hundreds of companies and a global brand, who knows what businesses might develop off the back of this bootcamp.
(The author is the founder of the Virgin Group. Excerpts from the author’s blog)