Starting a Business With Almost Nothing: Sell First, Build Later

The Short Version

The founders in these conversations who started with almost nothing did the same thing first: they got someone to pay, or to commit, before they spent on anything else. John Paul DeJoria collected twelve small orders from salons before he had a distributor [3]. Mark Cuban asked a prospect to front him $500 and bought the software with it [6]. Pieter Levels puts a payment button on a product within about two weeks [2], and Chris Koerner says to "Sell it before you have it." [1] Grant Cardone goes a step further and says not to start a business at all but to bring customers to one that already exists and take a share of the growth [4]. The caution comes from Simone Giertz and from the others' own stories: taking money first only works when you can deliver what you sold [5].

Table of contents

What They Said

Chris Koerner: stop playing business, find a customer

Chris Koerner, who says he has launched 75 businesses, was asked whether it takes money to make money. He says that was maybe true 30 years ago [1]. He can think of very few businesses that need more than $100 to $1,000 to start, and even a half-million-dollar restaurant can be tested first at farmers markets, pop-ups or a weekend food-truck rental [1].

His complaint is about what people do in place of selling. "People are masters at playing business and not doing business," he says [1]. They form an LLC, write a business plan, design a logo and tell friends they are making moves [1]. His instruction is to skip all of it and find a customer, even your mother or a friend, even an unpaid one who will leave a five-star review, and work everything else out afterward [1].

His clearest example is a couple in their twenties who washed his windows for $500 [1]. That is not how it went, he says, but it could have gone like this: they ask for a deposit of half, take the $250, buy about $50 of equipment, and come back to do the job [1]. They could have had nothing to their name, no car, no LLC, no insurance, and would have been paid to start a business [1]. He adds that it is not unreasonable to ask for a deposit, and Lewis Howes extends the idea: offer to come once a quarter and take a deposit for the next visit [1].

Koerner's own first real business shows both sides. In 2008, as a student at the University of Alabama, he opened an iPhone repair store funded by a credit card advance and part of his Pell Grant, and signed a five-year, $2,300-a-month lease with a personal guarantee when his mortgage was $500 [1]. He counts the lease as the wrong move [1]. The right move was that he never learned to fix iPhones before opening. When customers dropped phones off, he watched YouTube tutorials while they were gone [1]. He once pushed a screwdriver through a new $700 iPhone and had to replace it, but he calculates that roughly $2,000 in mistakes earned him an extra six figures by opening sooner and keeping momentum [1]. He calls such losses tuition [1].

Howes describes his own version, which he calls the boot camp method. He would run a free webinar and ask for the sale of a six-week live boot camp before building anything, then record the boot camp and sell the recording as a course, with a generous refund policy [1]. The question he was answering was whether people really wanted it before he built a site and landing pages [1].

Where do first customers come from? Koerner says usually friends, family, and a Facebook page with 300 followers or an Instagram with 262 [1]. The barrier is ego: people worry what someone from high school 20 years ago will think of a selfie video about their new business [1]. Howes recalls the line Koerner gave him: "you can't be prideful and broke at the same time." [1] For service work he points to free lead platforms. A TV installer told him he mounts 8 to 12 a day and makes around $300,000 a year purely from profiles on platforms such as Google LSA, Thumbtack, Angi and TaskRabbit, with no ads, by doing good work and asking for five-star reviews [1].

His favourite current no-money idea for anyone with a few hundred followers is AI consulting: take a friend who owns a business to Starbucks, record the conversation, ask what is wrong in the business, then use ChatGPT or Claude on the transcript to pick one fix and learn how to implement it [1]. For the fear of posting an offer he prescribes "Post and ghost": post it, tell people to message you, and do not read the comments [1].

Pieter Levels: a payment button from the first day

Pieter Levels has built and launched more than 40 startups, mostly alone [2]. "I don't really raise money. I don't use VC funding. I do everything myself," he says [2]. Without funding he has to move fast, so he builds a small version, launches within about two weeks, and checks whether people will take out their credit cards [2]. Most ideas fail, and he expects that [2].

The habit came from a low point. At 27, alone in hotel rooms in Asia with income down to around $500 a month, he set himself the challenge of 12 startups in 12 months, each launched publicly with a Stripe payment button [2]. The month limit forced him to cut features [2].

His AI products show how little he builds before charging. Avatar AI launched with an HTML page, a Stripe payment link and a Typeform for photo uploads [2]. He trained the first few hundred models by hand until the workload forced him to automate [2]. It made about $150,000 in a week [2]. Interior AI made $10,000 to $20,000 a month within a week of launch [2].

He advises charging from the start instead of chasing free users, who rarely convert without ad budgets paid for by venture capital [2]. Solo makers should aim for $30 or more per user; a thousand paying users at $30 is enough to live well [2]. He keeps margins high by not hiring, by automating, and by simply asking vendors for discounts, which he says often works [2]. When his GPU vendor raised training prices from $3 to $20 on a $30 product, he went to another provider's CEO and persuaded him to add the feature he needed [2].

He makes one exception to charging. Hoodmaps went viral, never made money, and once ran up a $20,000 Mapbox bill [2]. His conclusion: "you don't need to monetize everything like some products just cool." [2]

John Paul DeJoria: twelve orders and five percent

John Paul DeJoria and Paul Mitchell had lined up a backer who pulled out at the last minute [3]. No bank would help: "But no one will give us a loan." [3] They had no assets, no jobs, no company history and no cash coming in [3]. DeJoria says the company began with about 700 dollars [3].

So the first move was sales, door to door. He put the product in his car and drove down Ventura Boulevard stopping at beauty salons [3]. He chose salons because he knew the industry and because a hairdresser knows a good product and will recommend it with no advertising [3]. After a week he had twelve orders, ranging from 27 dollars to a couple of hundred [3].

Then he used those orders as the thing he was selling. He walked into the biggest beauty supply distributor in Los Angeles, whose president asked why he should bother with an unknown line that had no advertising [3]. DeJoria laid twelve checks on the desk with the payee left blank and told him those were the distributor's first twelve customers [3]. He offered Los Angeles and Orange County for a 2,000 dollar order and promised to work alongside the sales staff until the stock was gone [3].

The last step is the one he says a listener with no money most needs to know. "If you have no money and you can't wait 45 days to have your bills paid," he asks, how do you exist [3]? Knowing the problem in advance, he had built a cushion into his prices: "I worked into my profit margins an extra 5%." [3] He offered it as a discount for a check on delivery, and the president laughed and wrote the check [3]. Without those twelve orders, DeJoria says, there would have been no deal [3].

He does not pretend this was quick. "We put everything in because we had nothing." [3] It took two years to have even a couple of thousand dollars; the moment the partners felt they had made it was when the bills were paid on time and 4,000 dollars was left over [3]. His rule for the first sale is to make it the first of many: "Sell the reorder, not just the order." [3] The product has to be good enough that customers come back or tell others [3]. And the first of his rules for anyone starting is to expect to hear no. He sold encyclopedias door to door for years and was taught to knock on door number 100 with the same enthusiasm as door number one [3].

Mark Cuban: ask the customer to front the money

Mark Cuban started MicroSolutions at 25 after being fired, while sleeping on the floor of a three-bedroom apartment shared by six guys [6]. With nothing to lose, he asked prospects from his old job to front him money [6]. A company called Architectural Lighting put up $500, which let him buy software and sell it at 50% margins [6]. The customer's money was the starting capital.

He names three traits of a great entrepreneur: curiosity, agility and the ability to sell, because no business has ever survived without sales [6]. His definition takes the pressure out of it: "Selling is just helping." [6] At 12 he sold garbage bags door to door by asking people if they used them and offering to drop them off [6]. He insists salesmanship is developed, not innate [6].

For people with more to lose than he had, his advice is preparation: save money, give things up, learn the industry deeply, and use nights, weekends and lunches to see whether anyone will actually pay you [6]. He warns against the usual substitute for that test, which is asking friends and family, who always say the idea is great, then searching Google, finding no competitors, and stopping [6].

His later company followed the same order on a larger scale. AudioNet, later broadcast.com, started in his second bedroom with an ISDN line and a server, and grew with no advertising from 10 users a day to about a million over four years [6]. The free consumer service was the proof of concept; the revenue came from corporations that had been paying millions for satellite broadcasts and could now reach employees on their PCs for far less [6].

He also keeps the target modest. A business, he says, does not have to be huge; it has to make the entrepreneur happy [6]. He tells of Laney, a 19-year-old with a simple sugar scrub that he thought could be a two-to-five-million-dollar business, who called six months after her episode aired to say she had a million dollars in the bank [6].

Grant Cardone: bring the sale to someone else's business

Grant Cardone was dropped into Pueblo under a false name with $100 and 90 days for the show Undercover Billionaire [4]. He says he never touched the $100 and never looked for money [4]. He was looking for people: "I'm looking for contacts that can actually become contracts." [4] In a city of about 112,000 he wanted perhaps 50 with money, credibility and credit lines [4].

His position is the sharpest in the set: "America does not need a new business." [4] He claims there are 34 million businesses in the country and that two thirds break even or lose money, so it is smarter to help one than to open another [4]. His deal with a mattress store owner shows the method. He promised the store its biggest weekend if the owner would approve a few thousand dollars of spending at a print shop, which Cardone did not want to handle himself [4]. He made banners, stood in the street and drove traffic [4]. Afterward he asked only to be a partner. He says the owner proposed 15% of everything above what the store was already doing, and only then did Cardone ask for a $10,000 advance against that share [4].

Two points matter. He delivered the sales before he asked for anything, and he asked for a share of new growth, saying it would be unfair to ask for a piece of what an owner had already built [4]. His advice is to "go get you some equity" [4].

On the sale itself he argues for bluntness. He was terrible at sales, he says, until he decided at 25, "I just got to tell people the truth" [4]. He leads with the price instead of hiding it to the end, and opens webinars by saying he intends to make everyone a customer that night [4]. He also qualifies early, including whether the person has ever spent that kind of money, and walked out of one meeting in Pueblo as soon as he judged there was no money or opportunity in the room [4].

Simone Giertz: when the thing you sold has to be manufactured

Simone Giertz's Everyday Calendar began as a personal tool and was sold first: a Kickstarter launched in 2018 and shipped a year late [5]. Her first prototype used 365 physical toggle switches, which would have been far too expensive, so the product had to be redesigned around capacitive touch [5]. Her lesson is that making one of something and making thousands are completely different beasts, and that "everything takes so much longer than you think it's going to." [5]

She runs a self-funded business, and for her a bad batch of 10,000 units is a terrifying risk [5]. As someone afraid of letting people down, she jokes, "I can disappoint people at scale." [5] Her answer is to use her YouTube channel as research and audience testing for the product business, and to keep the store separate from her personal brand so it can run without her face [5]. She also designs the most beautiful version first and then decides where to compromise, the opposite of shipping the roughest thing that will sell [5].

Where They Agree, and Where They Don't

They agree that a customer is the test. Koerner, Levels, Howes, DeJoria and Cuban each describe getting payment or a firm order before building the rest [1][2][3][6]. They agree that opinions do not count: Cuban dismisses friends and family who say it is a great idea, and Levels counts only credit cards [2][6]. They agree that the usual starting costs can wait. None of them began with an office; DeJoria's office was an answering machine at a friend's house, Cuban's was an apartment floor, and Levels works from a laptop [2][3][6].

They agree that the customer's money can be the capital, through a deposit, an advance or fast payment terms. Koerner's window washers, Cuban's $500, DeJoria's five percent discount and Cardone's $10,000 advance are four versions of one move [1][3][4][6].

The first disagreement is whether to start a business at all. Cardone says to join and grow an existing one for equity [4]. Koerner, Levels, DeJoria and Cuban started their own [1][2][3][6]. Cardone's reasoning is that most small businesses already struggle and their owners will gladly share growth they could not produce themselves [4]. The others' reasoning is that a new service or product can be tested for almost nothing [1][2]. The two views meet on the method: either way, you prove you can bring in a paying customer first.

The second is whether the first job should be free. Koerner will take an unpaid first customer for a review [1]. Levels says to charge from the start because free users rarely convert [2]. The difference follows from the business. A local service lives on reviews and referrals, so one free job buys proof [1]. A software product with free users has costs and no signal about willingness to pay [2].

The third is how much to promise before you can deliver. Koerner opened a repair shop without knowing how to repair, and treats the damage as tuition [1]. Giertz's pre-sold product shipped a year late, and she worries about letting buyers down in bulk [5]. DeJoria insists the product be good enough to reorder [3]. Their caution rises with the stakes: a broken phone can be replaced the same day, while a manufacturing run of thousands cannot be undone [1][5].

A smaller difference: Koerner signed a five-year lease with a personal guarantee and calls it the wrong approach, and warns against pressure that could crush you, such as a failed business bought with a loan [1]. Cardone, later in his career, embraces very large debt for investments [4]. That is a statement about a mature portfolio, not about day one, where he spent nothing [4].

Why It Works

It is the cheapest honest test. Howes ran a webinar to learn whether people wanted a course before building it [1]. Levels expects most ideas to fail, so he makes each failure cost two weeks [2]. Cuban points out that many people never run the test at all [6].

It removes the need for capital. A deposit buys the equipment, an advance buys the inventory, and a discount for payment on delivery replaces a loan nobody would give [1][3][6].

Orders are an asset you can show. DeJoria's twelve checks were what persuaded a distributor to take an unknown line [3]. Cardone's weekend of sales was what made a store owner offer him a share [4]. Reviews do the same job for the TV installer [1].

Constraint forces focus. Levels had to cut features to fit a month, and concluded, "I think constraints probably make you happy." [2] Koerner says constraints produce creativity and ties it to Parkinson's Law, the idea that work expands or contracts to fit the space you give it [1].

Speed compounds. Koerner's estimate is that opening before he was ready cost about $2,000 and earned six figures [1]. He says the first skill of entrepreneurs is a bias for action, being "impatient with action, but patient with results." [1]

And the real obstacle is social, not financial. Koerner argues that what people call fear of failure is fear of being seen to fail by a few hundred acquaintances, who in fact will think little about it [1]. Charging on day one is uncomfortable for that reason, which is why he tells people to post the offer and not read the comments [1].

Where It Applies, and Where It Doesn't

It fits services you perform yourself, such as window washing, TV mounting, repairs and consulting, where a deposit covers the tools [1]. It fits software and digital products that one person can ship in weeks [2]. It fits reselling, where you can test with a single item bought for a few dollars [1]. It fits a consumable product sold to businesses that reorder, as DeJoria's was [3].

It fits less well where delivery is slow, costly or risky. Giertz's experience with manufacturing shows a pre-sale turning into a year's delay [5]. Koerner himself says a restaurant should be de-risked with pop-ups first, which is a smaller sale, not a pre-sale of the restaurant [1]. Cuban's own later company ran a free service for years before corporate revenue arrived, so charging on day one is not a universal law even for him [6]. Levels grants that some products are worth making without revenue [2].

It also depends on your circumstances. Cuban had nothing to lose at 25; for someone with a mortgage and a family he advises saving first and testing on nights and weekends [6]. Koerner warns against pressure heavy enough to push you toward bankruptcy [1]. And it is slow: DeJoria took two years to have a couple of thousand dollars, and Koerner admits that for most of his career he had more zero-income years than positive ones [1][3]. Some figures here are the speakers' own claims, such as Cardone's counts of American businesses and Koerner's income estimates for resellers and installers [1][4].

What To Do With It

1. Skip the LLC, logo and business plan for now. Find one customer, even a friend or relative, and work the rest out after [1].
2. Ask for money before you spend any. Take a deposit of about half on a service job and buy the equipment with it, or ask a prospect to front the cost of the first order, as Cuban did with $500 [1][6].
3. For a digital product, launch a plain page with a payment link within about two weeks and do the work by hand until volume forces you to automate [2].
4. Before building a course or program, sell seats to a live version, deliver it, record it, and offer a generous refund policy [1].
5. Price for cash flow. Build a few extra percent into your margin so you can offer a discount for payment on delivery instead of waiting 45 days [3].
6. Collect small orders first and take them to a bigger buyer as proof, the way DeJoria put twelve checks on a distributor's desk [3].
7. Charge from the start when free users would cost you money; do one free job only when a review or referral is what you need most [1][2].
8. List yourself on the free lead platforms, do good work and ask every customer for a five-star review [1].
9. If you would rather not start from zero, offer a struggling business a result first, then ask for a share of the growth above what it already does, and an advance against that share [4].
10. Promise only what you can deliver in the time you state. If the product must be manufactured, test demand with an audience first and expect it to take longer than planned [5]. Make the first sale good enough to be reordered [3].

Sources

1. Chris Koerner on Starting a Business With No Money, the Barbell Method, and Donating a Kidney to a Stranger · The School of Greatness
2. Pieter Levels on Building Solo Startups, Photo AI, Simple Code and Digital Nomad Life · Lex Fridman Podcast
3. A Billionaire's Keys to Success and Building an Empire with John Paul DeJoria · The School of Greatness
4. Grant Cardone: Mastering Money, Persuasive Negotiation & Building a Billionaire Mindset · The School of Greatness
5. Simone Giertz on Shitty Robots, Surviving a Brain Tumor, Truckla and Building a Product Business · Lex Fridman Podcast
6. Mark Cuban: Shark Tank, DEI, Wokeism Debate, Elon Musk, Politics, Drugs · Lex Fridman Podcast