How Much Captial Do You Need to Start a Business?

**htmlbasictutor** · #1 (**permalink**) 07-03-2009, 03:49 PM

Lots of people just jump into starting a business without thinking about how much money (capital) they need in place to get started.

Quote:

"*When you start a new business, you need money *to get it off the ground. You need the money to rent or purchase space for the business, furniture and equipment, supplies, professional fees such as legal and accounting, as well as continuing the research and development of your product or service. You may also need money to pay employees. There are several places where you can get the money that a new business needs, but first you need to think about which type of funding will work best for your company. ..."

Continued: How Start-up Capital Works

Each type of business requires a different amount of capital. Even if you decide to have an internet business as an affiliate there are some costs involved when starting out.

Whether you decided to quit your "Day" job or have lost your job due to the recession, you still need some money either tucked away or coming in for daily living expenses. Some say you need 6 months salary squirelled away before considering quitting your job and going on your own.

So, lets collect ideas on how much capital a person needs to start their chosen business.

The goal of this thread is to collect ideas on costs for people considering starting a business and need some figures to work with.

**T0d** · #2 (**permalink**) 07-03-2009, 05:21 PM

Well if you are starting a web business you most likely already have the Internet and a computer

So you will need hosting 5-10$/mo a domain $9/year.
And then if you can do the work no more, or if yo have to pay it could be anywhere from $100 to $100,000+ depending on the business you want to start.

angilina · #3 (**permalink**) 07-05-2009, 12:19 PM

Yes, its true. But some online businesses do not need much investment [money]. For example, if a person wants to start a blog in some Niche, then that can be done wothout paying any money at all. A person can get that blog for free at blogspot.

Even if we go with our own site and hosting, then a good hosting plus domain name costs something about $120 per year.

But if a business requires to get some products, offices, employees, then yes, one need to properly estimate the cost involved. A proper plan will be needed to start such business.

firecat · #4 (**permalink**) 07-05-2009, 01:17 PM

Back in the dark ages when I took over an existing retail business, the consensus seemed to be that you should have enough capital to see you through three years. In general, it was assumed that a new business (if it didn't fail before three years) would take that long to show a reasonable profit. Since many of the costs of an online business can be much less than a "brick and mortar" one, this would probably be overkill, but I'd still think it would be prudent to try to have enough money to keep you going for a year before having to depend entirely upon your business income.

PC Games Magazine · #5 (**permalink**) 07-05-2009, 02:43 PM

I think the most important capital is your brain, your ideas, but of course you should have 100 bucks to start up!

**htmlbasictutor** · #6 (**permalink**) 07-05-2009, 04:54 PM

Quote:

Originally Posted by angilina

...if a person wants to start a blog in some Niche, then that can be done wothout paying any money at all. A person can get that blog for free at blogspot....

I would never recommend a person does this if they are trying to build a business.
a) It does not add credibility to your business, even if it is a revenue generating blog.
b) There's no way to 301 permanently redirect the traffic at the original location you have built up if later you decide to move to a self hosted blog/website other than leaving blurbs with links to the new location. (you don't have access to the root of your "space" to add a .htaccess file with the proper permanent redirect instructions)
c) You won't be able to redirect all those incoming links you built/paid for as you built your business.
d) What if your "free" hosting closes? e.g. GeoCities and 360 at Yahoo! have been around for years. They are both closing in July. All your work over the years is down the tubes and you'll have to start over.
e) Using your ISP "free" webspace isn't any better. You have the same problems as with other free hosting. Plus if you ever change ISPs you loose your webspace.

Investing approximately $120 per year as suggested in one of the other replies is a small price to build credibility and be in total control of your business' destiny.

extremeseos0007 · #7 (**permalink**) 07-06-2009, 05:32 AM

If you do not have much to invest in business then you can look for taking franchise -
there are some of the advantages of choosing a franchisee-

# Low Cost at Overall, including start up cost
# Flexible working hours
# There is no need for large rooms
# Several employees only
# Minimum technology requirements
# Minimum reserve requirements

**htmlbasictutor** · #8 (**permalink**) 07-06-2009, 09:01 AM

Quote:

Originally Posted by extremeseos0007

If you do not have much to invest in business then you can look for taking franchise...

Quote:

The goal of this thread is to collect ideas on costs for people considering starting a business and need some figures to work with.

The cost of buying a franchise varies but give our readers some idea of the cost.

mybluefan · #9 (**permalink**) 07-06-2009, 11:56 AM

I did a business course once and was told that whatever I thought it would cost, double it, and that would be more like what it will actually cost.

IvanJosip · #10 (**permalink**) 07-30-2009, 04:34 AM

If we are talking about online business you can start from 0 to few hundred bucks.

Here are some costs for online business:

1. Domain name from $7 - $10 per year
2. Unlimited hosting $90 - $150 per year
3. Keyword research Tool $90 - $150 one time payment or $50/month
4. Autoresponder from $13/month to $20/month or $50 - $200 one time payment
5. Outsourcing for article or content writing $1 / 100 words to $25/article
6. Logo design $30 - $150
7. Web design $50 - $2500
8. Investment in some e-books $5 - $...?

So, you can say around $350 you will invest sooner or later.

IJ

Natural Elements · #11 (**permalink**) 07-30-2009, 10:50 AM

How Much Capital Do You Need to Start a Business?

Blogspot is not made for business as Htmlbasictutor said and she is right. You can moneytize Blogspot with sponsor links, adsenses etc... but that's a cheap way to create sites with a lot of limits. Basically you can use blogspot to start for cheap annoncements, learning how to master a site, sponsor links, create a fun network between blogspot users/readers.

Service sites like webdesign, graphic design, and else cost money with all the hardwares and softwares to run these businesses like High end computer and screen, Adobe softwares (they are not cheap), business licenses if you are a company, professional memberships, etc
Advertising including membership fees on freelancer sites, yellow pages, etc
We are talking about thousand dollars professional business there!

And e-commerce which involve 2 types:
Drop shipping and online store.

Drop shipping is the cheapest way to sell, but make no mistakes, to be profitable you need to sell high price items because if you've got 10% on products less then $10 you will not make it, guarantee! Investments are FTP software, site, domain name, hosting, business licenses, tax ID, advertising, etc Cost is a few thousand dollars, more if you hire outsourcing people/companies doing the technical work.

Store online is the hardest and the most interesting experience you can have.
You need to buy your inventory, taking the risk of selling unpopular items, Investments are FTP software, site, domain name, hosting, SEO, Marketing, business licenses, tax ID, advertising, etc
Costs are ten thousand dollars (depending of the products you are selling) to hundred thousand dollars, more if you hire outsourcing people/companies doing the technical work.

Perhaps you will be scared with the numbers, but if you are serious about your business, that's what you need to considere.

robertgallagher · #12 (**permalink**) 08-04-2009, 06:44 AM

i Need $50000 USD to start my business. but right now i have to work hard for that.

mybayceo · #13 (**permalink**) 09-01-2009, 06:43 AM

Starting and running a business is a tough job today! The overheads and investments get locked in offline businesses. [Removed]

davidyxf · #14 (**permalink**) 09-01-2009, 09:17 PM

Quote:

Originally Posted by angilina

Yes, its true. But some online businesses do not need much investment [money]. For example, if a person wants to start a blog in some Niche, then that can be done wothout paying any money at all. A person can get that blog for free at blogspot.

Normally, blog can't feed you dailylife, so less investment means less outcome

hermawan · #15 (**permalink**) 09-02-2009, 01:48 AM

$ 100.000 To start corporation

**htmlbasictutor** · #16 (**permalink**) 09-02-2009, 01:54 AM

Quote:

Originally Posted by hermawan

$ 100.000 To start corporation

What kind of corporation?

cobaltinee · #17 (**permalink**) 09-02-2009, 05:10 AM

Hello Tod. Nice question. I think you need to start at list 1 Million Dollar for your capital and start a very successful business. Thanks.

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besteast · #18 (**permalink**) 09-02-2009, 08:24 PM

Capital is needed, but don't ignore the other factors: your ability, the prospect of your business, the development of your business line, the power of your business team, many many factors, start a business with certain capital is easy, but to boom it is so hard

**htmlbasictutor** · #19 (**permalink**) 09-02-2009, 08:30 PM

Quote:

Originally Posted by htmlbasictutor

...So, lets collect ideas on how much capital a person needs to start their chosen business.

The goal of this thread is to collect ideas on costs for people considering starting a business and need some figures to work with.

Bolding by yours truly.

**ScriptMan** · #20 (**permalink**) 09-03-2009, 06:13 AM

The dot com bubble was created by people who though any plan woukd work if you threw enough money at it.

The truth is many of the most successful businesses started on a shoe string with a concept that met the consummer needs at the time. Pizza Hut was started on a wing, a prayer and $500.

Think about it.