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Starting a business in the UK with no money
7 min read

How to start a business with no money

Record numbers of people in the UK continue to start their own business. According to the Centre for Entrepreneurs, UK business formations grew by 13.25% in 2020 to reach a new annual record of 772,002.

People who start their own business come from all manner of backgrounds. And while some can use their own savings to start and get their new business off the ground, others have little or no money of their own. That need not be a big issue. This article will take you through the steps of starting a business in the UK with no money – including a free 50+ page ebook to help you get up and running. 

Download: How to start a business in 20 days ebook

We get it. There’s a lot to think about when you’re starting a business. That’s why we’ve created this free eBook that will provide you with a focused and 100% manageable action plan.   

From budgets to social media, our how to start a business in 20 days eBook is the smart guide to getting your business up and running. 

Can I start a business with no money?

It is possible, but much will depend on what you plan to sell and how. If you need to buy materials, stock, machinery, tools, equipment or a vehicle, obviously, you’ll need some start-up cash. But if you’re a plumber, mechanic, chef, tree surgeon or hairdresser and already own the tools of your trade, starting your own business need not cost a lot.

Similarly, if you already own a laptop, even with very limited funds, it may be possible to start your own home-based content, marketing or PR agency or HR consultancy, accountancy firm or virtual PA business.

Which businesses can I start for little money?

Making money online can be quick, easy and cheap, especially if starting a business on eBay and Amazon, or setting up an Etsy shop. You may also be able to create your own website for an e-commerce business for relatively little cost.

You could become a “dropshipping” business. Basically, you offer products online made or supplied by a third-party supplier. Once a customer makes a purchase from you, the third party supplier ships it to them directly, so you never have to buy stock or pay for storage space.

There are many service-based business that can be set up and operated at no or low cost. Examples include a dog-walking business, domestic cleaners, personal trainer business, yoga instructor, guitar teacher, photographer, translator – the list goes on. You could sell cakes or other food items you make at home without having to fork out for anything other than ingredients.   

starting a business with no money

Save costs – start your business from home

Premises and associated costs can be significant. Having to pay such overheads can place you and your new business under much pressure. If you can set up and run your new business from your home, you’ll save lots of money and your business will be more likely to survive and become profitable. You may or may not decide to take on premises when you’re more established.

The key to successfully making money from home is to make sure you have dedicated space, which could be a spare room, garage or even garden shed. That may not be an option, of course. You may need to make do with a kitchen table, which is where many successful businesses have started. If you need to meet suppliers or customers, their premises or a local coffee shop will be fine.

How to not buy anything

If you don’t have any money, you literally cannot afford to buy anything for your new business. Get into that mindset. Buying things on your credit card when setting up your business can lead to serious debt issues later on, so don’t do it. Set yourself the challenge of finding alternatives to buying.

Firstly, make do with what you have. You don’t have to rush out and buy a new computer if you have one that works well enough. The idea of a swanky new office desk or latest smart phone might be appealing, but work with whatever you have.

Another good way to save money is to become a borrower – but there are risks.

  • What if the lender suddenly asks for the borrowed item back at an inconvenient time?
  • What if a borrowed item breaks or gets lost?
  • Can you afford to buy a replacement?

If you’re careful, borrowing can dramatically reduce your start-up costs.

Much depends on your skills, but you may be able to swap goods and services with others. For example, “I’ll build your wall if you make my website” or “I’ll give you some of the beer I make if you’ll take some product photographs for me”. With the right contacts, you could even negotiate some free space in someone else’s premises.


starting a business in the uk with no money

What if I really need to buy?

Don’t buy anything unless you really need it to start and run your business. Even if something only costs you £20 a week, a seemingly small sum, that’s £1,040 a year.

If you really do need something, explore second-hand options first. You may find what you need on eBay for a fraction of the cost, while visiting a local auctioneers or charity shop can provide bargains. Just asking on social media can lead to getting stuff for free or cheap. Never be afraid to ask.

If you need to buy new, shop around. If quality isn’t important, find the cheapest price. Where quality will affect your sales, find suppliers that offer best value. Negotiate firmly, but don’t push your luck too much. Learn to recognise when you’ve got a good deal. Leasing equipment is another option to avoid large upfront costs.

What about setting up a website?

The best website-builder options potentially offer a way to save lots of money. Popular choices include Wix, Weebly, Squarespace, WordPress, Webnode and GoDaddy (there are others). You’ll have to pay a relatively small monthly fee for your website, but if you can build it yourself, you’ll save hundreds of pounds for a basic website.

If you ignore or deviate too much away from the templates such DIY options provide, you can end up with an amateurish eye-sore of a website that’s puts off customers. Stay close to the template and keep it simple.

Also online, there are a multitude of apps that enable you to create your own free business logo. Usually, you simply have to apply your name, colour and font choice to a design you like. Again, this can provide a significant saving. If you really do have an eye for design, you could have a stab at creating your own posters, leaflets and stationery on your PC.  

Inspiring stories – from low-budget start-up to multinational heavyweight

  • Amazon offices

    Reportedly worth of more than US$200bn, Amazon founder and CEO Jeff Bezos is believed to be the world’s richest person. For very little of his own money, he started Amazon as an online marketplace for books from the garage of his three-bedroom rented home in the Seattle suburb of West Bellevue in 1994. In 2020, Amazon’s annual revenue grew by 38% to US$386bn (source: Forbes).  

  • Airstream

    In 2007, room mates Joe Gebbia and Brian Chesky were struggling to afford the rent on their San Francisco loft apartment, so they bought three air mattresses they planned to hire out to paying guests. They created a simple website and Airbnb was launched in 2008. In 2020, Airbnb had a market valuation of more than market valuation more than $100bn (source: Bloomberg).  

  • Nike trainer

    In 1964, University of Oregon athlete Phil Knight and his coach Bill Bowerman started Blue Ribbon Sports with just US$500. They sold running shoes made by Japanese shoemaker Onitsuka Tiger at track meetings from Knight’s Plymouth Valiant car. They opened their first retail outlet two years later and launched their own shoes in 1972. Nike Inc now employs 76,700 people worldwide and made sales worth US$37.4bn in 2020 (source: Nike).

  • Tesco

    The origins of Tesco date back to 1919, when Polish immigrant Jack Cohen set up his groceries stall in Well Street Market in the East End of London. He didn’t open his first store until 1931. Now with 7,000-plus shops and more than 423,000 staff, Tesco has grown to become the world’s third-largest retailer in terms of gross revenues. The Tesco Group made sales worth £53.4bn in 2020 (source: Tesco).

  • Ikea store

    Ingvar Kamprad founded IKEA in 1943, aged 17, using a small amount of cash his father gave him for doing well in his high school exams. Kamprad started off by selling pencils, postcards and other small items via mail order. His base was a little shed outside the family home. Five years later, he started selling furniture. IKEA now has 500-plus stores, more than 217,000 staff and made retails sales worth €39.6bn in 2020.

  • Instagram icon

    The hugely popular photo and video-sharing social network started life as a side-hustle created in 2010 by software professionals Kevin Strysom and Mike Krieger. They rented a desk in a shared office in San Francisco that didn’t have heating, so they had to wear their coats to keep warm. Just two years later, Facebook bought Instagram for US$1bn (£763m).

Starting a business in the UK with no money – A few final words of advice

Reach out to free sources of reliable online and offline advice. It could save you a lot of money on professional fees and enable you to make good cost-saving choices. Commit to growing your own knowledge and skills significantly, because the more tasks you can take care of the cheaper it will be to launch and run your business.

Don’t recklessly cut corners or do anything illegal to save money – it really isn’t worth it. Don’t burden yourself with debt you cannot afford when starting your business, because it could leave you drowning and unable to get out of trouble.

Realise that pinching pennies too much can hinder performance or put off customers. You certainly need to be a bit cheeky if you want to save money when starting a business. If you don’t ask, you won’t get. You also need to be creative, resourceful and fully prepared to make sacrifices and do without. Pretty soon, the rewards could make it all worthwhile.

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