This article focuses on how to start a lip gloss line with no money.
Not all business ideas require huge startup costs to successfully get things started. Also, the availability of financing isn’t a guarantee that a business idea will flourish or be successful.
So, is it possible to start a business with no money of your own? It’s possible and you’ll find out how.
This is a business idea that can be launched with little capital. With proper management, your lip gloss line could blossom into a major enterprise.
Note that the focus here has to do with not starting with your own money.
Is There Competition?
One of the first questions you’ll need to ask is whether there’s competition within this cosmetic niche. Without a doubt, there’s significant competition within the industry.
As a matter of fact, there are heavyweights with huge branding power and market share.
Some of the top brands include Charlotte Tilbury Matt Revolution, Napoleon Perdis, Bobby Brown, Chanel, Rimmel London Provocalips 16HR Kissproof Lip Color and so many others.
You have your work cut out even before launching your operations.
It’s difficult to compete with these top brands in their own turf due to funding issues and reach among others. As such, you’ll need to choose a niche you’re excellent in.
You may also want to leverage the reach and strength of other cosmetics-related businesses by going into some form of partnership.
Working Out Financial Details
To start a lip gloss line with no money of your own, you’ll need to first work out all financial requirements necessary to launch your operations.
Here, every detail regarding your expenses including operating costs must be worked out.
To do so, you’ll need to have performed a thorough evaluation of your financial needs covering all operational areas. All of these details including other operational areas of your lip gloss business are included in your business plan.
If you must get the needed financing, you’ll need a solid plan in place.
Through your lip gloss business plan, an investor can know whether your cosmetic business is worth investing in or not. In other words, your plan reveals the viability of your business idea.
There’s a willingness to invest once a clear or comprehensive path towards growth and profitability is established.
Getting the Needed Financing
There are lots of ways through which you can attract funding for your lip gloss line. Raising capital isn’t so difficult once you have the needed structures in place and you also know where to look.
One of the best ways to get funding includes starting or launching a crowdfunding campaign.
Other ways include asking friends and family, applying for a loan, approaching venture capitalists, and finding angel investors. You can also sell shares to interested investors.
Let’s stop right here and discuss each of the points mentioned.
Launch a Crowdfunding Campaign
Are crowdfunding campaigns reliable ways of raising financing for small businesses?
Absolutely! Today, there are lots of success stories given by entrepreneurs whose businesses were launched solely from crowdfunding campaigns.
Such businesses have since grown into thriving enterprises. The same can apply to yours!
There are tons of crowdfunding sites ranging from Patreon, GoFundMe, Crowdrise, FundRazr, Fundable, Kickstarter, Crowdcube, RocketHub, Fundly, Experiment, Kiva, YouCaring, Start Some Good LLC, LendingClub, CircleUp, and so on.
These sites provide access to investors who want to support any viable and promising business idea. However, you’ll need to prove your business idea by making a pitch.
What need(s) does your product serve? It will be necessary to have a website to showcase during such a pitch.
Asking Friends and Family
As simple as it sounds, asking friends and family for financing has proven to be one of the effective ways of generating funding for small businesses.
However, not all friends and family members will buy into your business idea. As such, you’ll need to be deliberate in choosing those having faith in your ability and idea.
P2P websites will prove invaluable as they enable you to work out your repayment plan. Sometimes, friends and family may decide to convert such funding into equity or shares in your lip gloss line.
Whatever the agreement is, it’s important to have everything worked out to enhance your chances of success.
Apply for a Loan
Another way to start a lip gloss line with no money is by applying for a loan from your bank.
This is one of the most popular ways that’s still used to this day. A greater part of the financing for small businesses is obtained through business loans as well as lines of credit.
However, it’s important to note that not all business loan types are ideal for your lip gloss line. As a small business, it’s best to apply for Small Business Administration (SBA) loans.
Other loan types to consider include term loans offered by financial institutions.
Qualifying for these loans requires passing multiple requirements that include having a good credit score among other things. You’ll have to prepare all loan processing documents such as balance sheets, bank statements, and tax returns among others.
Approach Venture Capitalists
Private equity investors such as venture capitalists are available sources of financing for small businesses such as a lip gloss line. However, this isn’t typically the starting point for your new business.
After obtaining the initial startup capital from sources such as friends and family, you can then move on to venture capitalists to attract funding.
It’s important to carefully understand all funding conditions before any agreement.
Finding Angel Investors
Angel investors are persons of high net worth who mostly operate alone.
However, to convince such investors of committing their capital to your lip gloss startup, you’ll need to have done a thorough job in putting together your business plan.
Backed with such a plan, you’ll have to pitch your business ideas as well.
Sell Shares to Interested Investors
There are financing opportunities where you get to sell a certain percentage of your shares to investors. Here, business valuation is of the essence as it helps you know the number of shares to be sold for a certain amount.
These are some of the ways by which you can start your lip gloss line with no money. The good thing is, a lot of successful businesses have emerged from humble beginnings using these same processes.