Many would-be entrepreneurs want to know if it is possible to start a business for free. Technically, it’s possible as long as you don’t put any value on your time. However, your likelihood of success is almost nil. Your options for what you sell are very limited, your ability to reach your potential customers is severely restricted and the likelihood that you will know enough to manage the business correctly and make the right decisions is very low.

Here are the top five ways to start a business for free and why they don’t make any sense if you want to succeed.


1. Entity and Name Registration — There is no cost if you choose to run your startup as a sole proprietorship. However, you will also have no protection of your personal assets from business liabilities — somebody sues your business, they are suing you. And, your name will have to be the business name as well, because nearly every state requires you to file a DBA (doing business as) fictitious name registration to use a different business name (and there is a filing fee).

2. Type of Business — Your options are limited to selling something that costs you nothing, basically a purely service venture. Selling any type of tangible product or providing a service that requires tools of any type will require spending some money. You are basically limited to 1099 work (non-employee status work for an actual company), personal services, or “information services” (you write informational pieces to sell.


3. Online PresenceEvery business requires an online presence. There are scores of web host companies that allow you to post your website for free. Of course, you don’t get your own domain name — your site will be a sub-domain of the host site. And, your site serves as host for the company’s per-click advertising revenue. That is, the host company makes its money from advertisers, which will be shown on your homepage. You do not have any say in which ads are displayed. Free websites tend to be very basic — they are the tent cities of the internet. It is extremely difficult to develop a positive business image using free web hosting.

4. Marketing — Of course there are free opportunities in marketing a business, but gaining a critical mass of prospects through free marketing techniques will take forever and a day. Some of the best free marketing options can be very successful, in conjunction with other paid marketing efforts. Press releases are a great tool, but only if you have news to deliver. Building a customer base through online forums and social sites is effective, but it takes a while when you are reaching only a few people at a time. If you want to succeed in business, a strong marketing plan is key. At a minimum, you will need business cards, a website, and a stable of opportunities to reach your target market.

5. Startup Information — Currently there are hundreds of websites that offer free startup information. A few are pretty good; most are useless. Overall, you get what you pay for. Most of the free information barely scratches the surface — they tell you what to do but not how to do it. For example, every business plan outline tells you to create a sales forecast, but they don’t tell you how to come up with reasonable estimates. In fact, a shocking number of them tell you to just guess. Very few, if any, tell you how to calculate a resource-based and value-based forecast first. Which, when taken together with your market-based estimate, will help you estimate a reasonable sales projection. This is a critical step. Without a viable sales forecast, there is no way to know whether an idea can be profitable. And, the sales forecast is just one of over 200 steps required to sufficiently plan and launch a startup.


Every startup requires a combination of time and cash to get off the ground. Having less of one means you need more of the other. If you are looking to support yourself fully through a business you own, get creative about finding the cash you need to get started. Some amazing success stories have sprouted from just a couple thousand in seed money, but very few, if any, began with no money at all.