Starting a business? All you need is $10,000

We surveyed over 130 business owners to see how they got their business up & running, and found out a few interesting facts about their startup capital & financing.

Almost 78% of owners start their business with 100% their own money.

The vast majority of entrepreneurs started their business with their own money. Less than 16% borrowed either from banks or from family/friends, even fewer acquired investors.

So if you’re thinking about starting your own business but don’t plan on using your own money, think again. Unless you have a business that will rapidly scale to hundreds of millions of dollars, people aren’t lending their money very easily. And since so many business owners are successful starting up with their own cash, you’re going to have to have a hard time digging into other people’s pockets – no matter how awesome the business plan, or genius the idea.

Got $10,000?

Over all, 60% of the business owners we surveyed started their business with under $10,000.

$10,000 is not a huge amount of capital for starting up a business, but it can produce great results.  75% of the respondents have more than one employee, and 47% of the business surveyed had sales (2010 numbers) of up to $500,000. So a little start-up capital can go a long way.

Almost 63% of businesses starting with less than $10K were profitable their first year

The challenge with a low amount of initial capital is that you don’t have much margin for error. That said, $10,000 can get you pretty far along as long as you focus on profits right from the start. 62.7% of businesses that started with less than $10,000 were profitable their first year.

Looking at all respondents, 50% of new businesses were profitable their first year, and 65% where profitable by year two.

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Devan Perine

Devan Perine works with small business owners on their marketing and multimedia efforts. She's passionate about helping businesses build their presence online, and giving Gen Y a voice in the workplace. When she's not working, she loves to make a mess in the kitchen, and play with her band around Chicago. She loves to chat! Give her a shout on Google+, Twitter or LinkedIn.

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