Opinions expressed by Entrepreneur contributors are their own.
Venture capital (VC) funding has plummeted in 2023 due to high interest rates and less enthusiasm from investors. Research shows that VC funding almost halved globally in the first six months of this year, ushering in what some have called a VC winter.
Despite this, entrepreneurs shouldn’t give up hope of making their dreams a reality. Even though VC funding has slowed to a trickle, good ideas to launch a successful business have not.
You don’t have to immediately go into debt to start a business — I didn’t. All I had when I started was a phone, a computer and my own personal credit cards. I took my idea, ran with it, and now we’re bringing in over $100 million in annual revenue.
Of course, it’s always more ideal when you have the help, but there are ways to jump-start your business without VC funding, and I’ll give you some pointers.
Related: How This Entrepreneur Went Global Without VC Funding
Hit the reset button on all of your expectations
You don’t need a pile of cash to get started. In truth, there is some benefit to going at it alone. Without investors at your side pumping influence into your company, you have full control and less pressure from outside forces.
But the consequence of this is adjusting your expectations in the beginning to get things moving. After all, Steve Jobs lived in his parents’ garage for years while developing his computers.
Starting a business is a difficult undertaking and greatly affects your work-life balance and day-to-day comforts. When I started PostcardMania in 1998, I drove an old Nissan Pathfinder that was paid for (so I didn’t have a car payment), didn’t have a weekly salary, and I didn’t go on vacation. I worked very long days, seven days a week.
At times, it was difficult to pay for living expenses, so I negotiated repayment terms to cover bills and maxed out a credit card or two to get by. I even bartered a room in my home to get free childcare because I had two young children at the time.
I was funneling as much money as I could into PostcardMania, and once we had enough clients to get a building, I took money out of my own home to help pay for it. After about five years — once we finally reached eight figures in annual revenue — I finally decided to reward myself with a little luxury: a Mercedes convertible.
Everyone wants to skip the hardship and get to the part where they become a millionaire. Overnight success stories hardly ever happen though, so strap in and get ready for some challenges. The hard work will be worth it to reach your destination.
Related: You Don’t Need VC Funding to Grow Your Startup. Here’s How to Turn Customers Into Investors.
Market your business more than most people think is sane
Oftentimes, people look at large companies with huge ad budgets and think, “Well of course they spend a ton on advertising — they have the money to!”
What most people (even entrepreneurs) don’t realize is that those companies are spending big chunks of their revenue on marketing out of necessity, not luxury.
Another hard truth: Investing hard-won money in marketing doesn’t always result in huge returns. Any marketing strategy you use to generate leads, like Facebook advertising, podcast sponsorships or direct mail, is not 100% guaranteed to deliver results. It’s a constant, ever-evolving game of figuring out what is working and what isn’t.
That is one reason why many business owners are so reluctant to spend money on marketing services. It’s not a straightforward purchase like buying work boots or supplies.
You’re going to win some, and you’re going to lose some.
It takes time and effort to find that special marketing formula for your business that works and brings in revenue. This is also why it’s so important to invest in quality marketing services, stay consistent with it over long periods of time and test multiple methods all at once to see what works best.
The Chamber of Commerce, a research company for entrepreneurs, states poor marketing initiatives as the #1 reason for small business failure. I can confirm this throughout my 25 years of experience serving small business owners. The ones that thrive don’t give up on marketing. In fact, they spend insane amounts of their resources on it.
Related: Can You Scale a Startup Without Venture Investment?
Cultivate and maintain the best talent with a meaningful business purpose
Promoting my right-hand woman, Melissa Bradshaw, to president of PostcardMania was a huge moment for me. I remember when I first started my business — with her right there by my side from day one — she helped drive my kids to school and answer phones. Today, she’s buying large digital printing presses and establishing entire new departments in my company.
She’s the perfect example of why you need to focus on finding the right people and then allow them to grow into the roles they were meant to hold. Not only was Melissa a key person in helping me make my dream into a reality, she also paved the way for finding more people to join us and turn PostcardMania into the thriving business it is today.
Melissa has two key qualities that I look for in every employee at PostcardMania: willingness and ownership. Willingness to do whatever is necessary to get the job done and the desire to take full ownership of any task she took on. When you are building a business, you need to find people who not only have the right skills for the job but also passion for your purpose.
If you want your staff to take ownership, you have to offer them more than just a J-O-B, and you have to allow them the autonomy to make decisions necessary to get their job done. In addition to that, establish a purpose for your business that goes beyond offering the “the best” products or services. At my business, we sell marketing services, but our purpose is to help small businesses grow, because a strong small business class is a better economy for all of us. And we feel it! We love when our clients succeed!
We’ve focused on hiring people who believe in this purpose for years, and we recently reached an all-time high for retention.
Lastly, once you have those people, treat them like gold, and don’t be afraid to give them space for their own successes and failures. I’ve had my share, but they’ve made me into the person I am today.
