Offer equity, not money
You don’t need a pile of money to get the right people to join your team. Many small businesses grew out of offering their employees stock options. This is how some of Starbucks' early employees grew to be millionaires.
Of course, it’s not that easy to find skilled and talented people who are willing to work for just equity unless they share your vision. People work harder for what they believe in, even when the financial return is delayed.
Opt for part-timers and contractors
It’s a financial burden to hire a full-time team when you’re just starting. Full-time employees are more reliable but are also more expensive. When you’re trying to take your small business off the ground, you have to squeeze more out of your budget.
It can take a start-up sometime before it has enough business that guarantees constant work for its full-time team. Instead, follow a project-based approach. Build a team of contractors, freelancers, and part-time employees. Clarity about your scope of work and what you expect will pave the way for a smooth and successful relationship with your contractors.
Not everyone wants a full-time job. Some parents prefer a job that allows them to spend more time with their kids. Others who used to work 9-5 jobs are looking for work that offers more flexibility and balance. They have great experience and are looking to employ it. Everyone's a winner. You can find independent contractors through freelancing platforms like Upwork and Fiverr.
Interns are another way to avoid big money. You’ll be trading work for an experience they can put on their resume. Bear in mind that interns aren’t experienced employees so you need to watch for a few points:
Why should they work for you?
Your job description should be as compelling as a clever consumer Ad. After all, you are trying to sell them something: to work for free (or a ridiculous amount of money).
Just as in an Ad, try to identify what your potential intern is looking for in an internship. Typically, interns want to advance their careers by building a strong resume and taking on responsibilities that hone their skills. Your job description should show them how you’re a good fit for them.
Don’t mistake a part-time intern for a full-time anything
A part-time intern or employee may have a less than perfect response time. This is because usually they have other engagements. Putting them in charge of anything that would require immediate attention is never a good idea, especially when they don’t have a fixed schedule. Save critical missions for the more available and experienced team-members.
Keep your interns busy
That being said, it’s advisable to have them engaged with a big project. One of the challenges you might face when working with interns is how to keep them occupied. One big ongoing project (just not a critical one) can help in many ways.
For one, it won’t be always possible for you to provide them with the small tasks that would typically keep them busy.
Involving them in a project that takes a few months or more to finish will look better on their resume. It’ll also give them a sense of accomplishment and purpose.
Keep an up-to-date pool of candidates. Your network and local university career offices are great places to look.
Create a performance-based pay structure
Salespeople are probably the most famous for this kind of compensation. They earn the bulk of their income when they achieve or exceed their sales targets. However, as long as you set clearly defined milestones, performance-based compensation can be applied to a whole lot of other roles.
Before you send out offers or sign any contracts, check with your lawyer. The last thing you want to do is to violate any employment laws.
Join the Barter Economy
Welcome to the “symbiotic economy” where people, instead of paying for services, they exchange them. This is an ancient concept that was relied upon as the only way to trade before the invention of money. However, recent events, like the 2008 financial crisis, have brought it back to life. The internet has made it possible for the barter system to prosper. Now that it’s not limited to geography, you can exchange services with people located in distant places.
Instead of paying for the services of a legal advisor, you can search for one who is also looking for a service that you can provide. Maybe you’re a freelance writer who wants to design their website. You can trade your content creation services for those of a web designer.
Ask family and friends
Although many don’t like to work with friends and family, there’s no denying that some extremely successful businesses are family-owned. Just like anything else, working with friends and family cuts both ways. But there will be times when you’ve run out of options. At such times, those closest to you will be happy to lend a helping hand. If you believe a family member or a friend has the skills your business needs, don’t be afraid to ask for help.
Until your business picks up, you’ll have to come up with creative ways to run the business with minimal fixed costs. While some of those tips are not necessarily long-term solutions, they can be quite helpful when you’re trying to operate a business on a shoestring budget.
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