The Myth about Lack of Start-up Capital

Every job seeker I come across tells me starting his or her own business is not an option because of lack of money to start. Most employees give themselves the excuse that lack of start of capital is the reason they cannot turn their hobby into a business. Both seem justified in why their lives are tied to the dreams of others, others started with virtually nothing and grew their business to the point whereby others feel proud to work for them. No business dropped from the sky.

Someone had an idea and believed in that idea long enough to start running with it, starting with their own money or resources before asking for help. If you read the story of how most businesses start from scratch, the founder did something – put something together, created a prototype, used their savings, mobilized funds from friends and family, and go some distance before soliciting investors. They moved. They ran with it, using all they’d got.

Before we examine each excuse, let’s note that the late Johnson H Johnson, founder of Ebony Magazine, Johnson & Johnson, several radio stations, a television production company, and a book publishing company among others started with $350 in 1945. Coming home to Nigeria, our very own Frank Nneji, founder of ABC Transport, Rapido Group which is into Education, Training and Presentation (ETP) products, hospitality, foods, etc started with N500 in 1980 when he was in 200 level at the University of Nigeria, Nsukka.

What excuse would a University or College student give for not having seed capital to get going with his dream? There is no dream that is so big it cannot be scaled down to where you are. N500 in 1980 is like $500 today, which is equivalent to N80,000. Most University students can save N80,000 in 4 years. Nigerian students sometimes drive the flashiest cars, use the best phones, and travel to the most exotic places for holidays, while the smart ones already own businesses.

There are many students who pay their school fees by themselves to proceed with their work or business. When I wanted to repaint my house some years back, I got introduced to a group of vibrant young men who I eventually gave the job to. They were from the University of Lagos. I was so impressed by their attitude and the quality of the job, much better than what I would have gotten from semi-literate painters. So University students do own businesses.

There is also the opportunity for internships. Engineering, science, and some other disciplines send their students on industrial attachment for 3 – 6 months, and 1 year in the case of OND students. Some students have the opportunity to do internships with companies that pay a monthly allowance, while they still live with their parents hence their overhead is virtually nil. That is income right there. Most students, rather than put that money away towards their dreams, spend it on phones, calls, clothes, and other things that do not move them one inch toward their goals and dreams. Since they do not look at that income as capital, they throw away that opportunity to start small and grow big.

So while in University, a student has many opportunities to save. From your pocket money, allowances during an internship, gifts, and business you can do right on campus – photography, and photocopying. That Blackberry phone alone is N30,000 capital sitting right there. There are countless businesses one can start with N30,000 if you are humble enough to start very small, use what you have, and earn income that will enable you to start buying equipment. You do not start with equipment, you make do with what you have. The secret is in scaling it down to the level you can start right where you are. That is why Frank could start with N500 in 1980, and Johnson with $350 in 1948. Do not despise the days of small beginnings. If you do, you will keep waiting for the big money as life and opportunities gradually pass you by. If and when you eventually get it, you do not have the requisite skills to manage that quantum of cash and soon you are back to square one – cashless and full of excuses.