BP Editors
Thinking about starting a business? If so, it’s important to consider your startup costs.
Owning your own business is a great way to make money, but the costs of building a business from the ground up can quickly become prohibitive. Expenses like marketing materials, formal business plan development, and even legal fees can add up quickly.
Luckily, there are many businesses you can start with no cash at all in your pocket. But if you do have a modest amount of savings for a business venture, then this is the list for you.
We’ve put together a comprehensive list of the best businesses you can start with five thousand dollars or less.
How to Start a Business
Before we get into which business you should start, let’s talk a little bit about how to start a business. While you need to save up your cash for capital investments in things like marketing, inventory, and a location, you’ll also need to set aside cash in order to make your business a legal entity.
How much money it will take, and how complex the process will be, depend quite a bit on A) What kind of business you are starting, and B) What state you will be operating in.
These days, LLCs (limited liability companies), are among the most popular legal entities for entrepreneurs and business owners, and their flexibility and simplicity go a long way in understanding why. That’s why Business Pundit has put together comprehensive guides for entrepreneurs looking to register an LLC in California, in Texas, in Florida, and in a variety of other states. Check them out!
Businesses You Can Start With $5,000 or Less
Now, for the good stuff: How to leverage your $5,000 to become an entrepreneur.
Tutoring
Whether you plan to tutor the occasional student here or there or would prefer to offer a more formal online course, doing so is affordable. All you need is a few thousand dollars to get started, and you don’t necessarily have to have a formal teaching degree to start either.
In fact, tutors are in high demand in many subjects. You could tutor in a “traditional” area, like English or mathematics, or you could branch out and offer specialty tutoring in subjects like computer science, graphic design, mechanics, or some other unique area.
You could even teach online or in-person classes on gardening!
Tutoring is a cost-effective way to start a business because it requires virtually zero overhead. All you need to do is figure out your target audience (who you intend to teach and market your course) and then develop some basic course outlines. You’ll also need to decide how you plan to deliver instruction, be it online or in-person.
Online Product Sales
Whether you want to sell a few duds you’ve had kicking around the house forever or you are an avid jewelry maker, you might consider going into online product sales.
This kind of side hustle can have as much or as little overhead as you decide to put into it. If you already have your inventory, you may not need to pay very much—perhaps just a few dollars in fees to selling platforms like eBay or Etsy.
If you don’t have an inventory built up quite yet, you’ll need to design and make your items before you can start selling to people. It’s wise to build up a few items in your inventory.
To be successful, you need to be a good marketer. Take clear, well-lit photos of your products from multiple angles, highlighting any imperfections if there are any. It may benefit you to take a quick (often free) online course about how to be a seller on Etsy, eBay, or your other platform of choice, too.
Consider doing some research into which online platforms are best for the type of product you plan to sell. For example, eBay tends to be best for used gear, while Etsy is ideal for crafters of all kinds.
Painting
Are you good at painting? If so, spending your $5,000 on this kind of investment is a smart choice. You can use your startup cash to buy some high-end tools along with basic supplies like drop cloths, ladders, edges—oh, and the paint itself of course!—so that you can offer your painting services to others.
You will need to pay for marketing and advertising—unless you plan to rely exclusively on social media—along with liability insurance and licensing in some places. People tend to be more comfortable if you have solid references to confirm the quality of your work, too.
As your business grows, you will likely be able to spend less money on advertising and marketing but it may be worth your time to consider branching out. For example, some painting companies add other services, like pressure washing or other construction services to their list of offerings. This can really enhance your earnings without creating lots of work for you, if you know how to manage employees.
Painting is a physical job, but if it’s something you like to do, it’s an idea worth pursuing.
Consulting
Consulting, whether online from home or in-person, is a great way to get your name out there if you have specialized skills and training in a certain area. From accounting to graphic design, green living to career development, consultants are in demand in many areas.
You might not think your advice and expertise matter, but the reality is that there are plenty of potential customers out there who might be interested in what you have to say.
There’s not much overhead involved in consulting work, but you should build a website that showcases your expertise. Print up a few business cards and have a reliable contract that you can use when you start making connections with potential clients, too.
Computer Repair
Computer repair is a smart niche to get into. Just about everybody has a computer, but very few people know how to fix their computers when something goes awry. Being the person with all the right skills can provide some very handsome rewards.
You will need to consider marketing expenses when you are just getting started, along with a few basic repair tools, software and equipment upgrades, and fuel, if you plan to do house calls. It may take you some time to get established, as many people are hesitant to trust strangers with the sensitive information that might be on their computers.
Business Waste Disposal
Got trash? Businesses sure do—and that trash tends to be of a more sensitive nature. In fact, many businesses spend thousands of dollars each month on trash disposal and recycling to make sure delicate information, such as financials and identification documents, aren’t exposed to security threats.
With just a bit of training, you can easily start a profitable waste disposal company. If you’re able to get contracts with large companies who typically hire environmental waste consultants to develop strategic waste reduction and recycling systems, you’ll be rolling in the dough in no time.
There are some overhead expenses for you to consider. You should invest in some training so you are aware of the best and most secure ways to get rid of this kind of waste, too.
You’ll have to pay for a truck to haul away the waste and in some cases, you might have to pay a warehouse or workshop to strip equipment for valuable metals and to meet recycling requirements. Once your business really takes off, you may need people to help you handle logistics and to time your pickups, too.
App Development
If you have strong technological skills and an innovative mind, creating an app might be a good side hustle idea for you. One of the best things about starting an app development company is that it can offer a form of passive income.
Once your app is launched, you won’t have to do much to maintain it—in some cases, you may be able to collect a paycheck with zero follow-up work later on.
To launch your own app, you will first need to come up with an idea.
Already have an idea fleshed out? Great. Next, you need to make sure your app meets the market demand. Look to see if there are apps in the same niche—has your idea already been taken? If it has, keep brainstorming.
Don’t worry if your tech skills aren’t quite up to snuff—you don’t need to be a coder or programmer to build an app. There are many app development services out there that will help you realize your vision. You may have to spend some additional cash on things like marketing. Often, you might consider hiring a marketing company or PR firm that’s familiar with new apps that are making waves in the tech world.
The app marketplace continues to grow by leaps and bounds, so if you have an idea for an app, don’t sit on it! The opportunity could be gone before you know it.
Real Estate
You’re not going to become a real estate tycoon with just $5,000 in your pocket. That’s the bad news. But the good news is that $5,000 is all you need to put a down payment on one property. As long as you have good credit and the ability to obtain a loan, you can buy a decent property with as little as 3% down.
You’ll be able to enjoy a steady rental income as a result. Property owners get certain tax deductions, too, so you may be able to get way ahead of your loan with the help of rent and many tax breaks.
In order to be successful in real estate, it’s important to look into the logistics: What kind of benefits are available for people who own properties, and what laws are related to managing rental properties?
Another option to spend your $5,000 to start a business? Consider investing the $5,000 as a downpayment on a property—and then flip it.
If you have strong construction and carpentry skills and don’t mind offering those services, this might be something you can do on your own (albeit with a bit more expense). Once the home is in tiptop shape, sell it and use the money from the sale to put toward your next property.
Bookkeeping
Good with numbers? While it may behoove you to have a degree in accounting if you plan to start a bookkeeping business, it’s not always necessary. There are many companies and individuals who will pay a self-employed bookkeeper to handle their accounting just to reduce their workload and in-office expenses.
There is very little overhead required to start a bookkeeping business. You may want to pay for licenses for accounting software and attend conferences that will update you on annual changes in tax laws and other relevant topics.
Party Rentals
This idea might sound odd, but hear us out. Have you ever been in a bounce house? It’s a ton of fun, right? It doesn’t matter whether the inflatables are at a birthday party, carnival, or backyard barbeque, offering your own party rental services is a smart way to spend $5,000.
You will have to buy some equipment when you’re first getting started, like the bouncy structures themselves along with “bonus” items (for example, lighting and special effects, obstacle courses, and games). You will also require a blower to inflate the equipment and liability insurance. Unfortunately, the risk of injury is a bit higher with this kind of small business.
Marketing is essential for this kind of business, too. You must be visible to people if you want to have a successful party rental company! However, once you have the gear and establish your name, it’s easy to make some extra cash. This business will make you more money the bigger you get and the more you invest, too. The saying “go big or go home” really applies here.
While one party rental will help you net $50 or so per day, having five or more could help you cash in several thousand dollars a month. Besides drop-off and assembly, there’s not much you have to do when it comes to actual work, either.
Repair Work
If you like to tinker, starting a small repair business is a smart choice. In some parts of the country, repair work can be seasonal—but if you market your services correctly, it doesn’t have to be. There are many ways to get around this limitation so you can offer your services year-round.
For example, if you do repair or maintenance work on things such as bikes and boats, why not extend your business so that you can do quick emergency jobs during the busy summer season and tailor your approach to do tune-ups or major cleanings during the winter?
You’ll have work year-round if you have a good reputation for your repair skills. Invest in some clever marketing—consider marketing at outdoor shops or marinas, for example—and reliable liability insurance. Otherwise, besides a few tools, this type of business can be started with very little cash upfront.
Business Plan Development
Is the most exciting part of starting your own small business just that—the “starting?” If you enjoy writing and doing market research related to business development, this might be a perfect niche for you. You can make a business out of creating comprehensive business plans that include everything from financial statements to business plan narratives and everything in between.
This is a side hustle that can be as flexible as you want it to be. You can offer clients the electronic files when your work is done, or keep their business plans on file. For a retainer fee, you can offer the service of updating or tweaking the file whenever necessary.
Virtual Assisting
Look online and you will see thousands of job postings from companies and individual people seeking administrative support. Virtual assistants are in high demand, and you don’t need much to get in the game. Often, all you’ll need is a computer with up-to-date software, a good internet connection, and strong communication and organizational skills.
In most cases, you can start a virtual assistant business with far less than $5,000. You could even do this work for free! However, to do it the right way, with proper marketing and a solid business plan, you may want to consider putting a bit of money down on your dream.
To succeed as a virtual assistant, you may have to hustle at first. Some virtual assistants work up to 18 hours per day when they’re first getting started! However, once you have an established client base and are able to market your services effectively, you can scale back and focus more on growing your business while working fewer hours.
Handyman
You don’t have to be a jack of all trades to start a business as a handyman—having even just one skill can help you succeed in this kind of business!
The demand for handymen and women is there. Few people have these skills necessary to fix or take care of even small issues in their homes—and even fewer have the time to commit to fixing them. It’s often easier to just call someone who can get the job done quickly and easily.
You won’t need to spend much money in order to start a business as a handyman. In most cases, all you need is a good set of tools and a ladder. You may also want a truck to haul around your gear and licensure and insurance, as needed.
There are some recurring expenses for a handyman business, such as fuel and equipment upgrades, but for the most part you can work whenever you want.
Tooth Whitening
People love their pearly whites.
Lots of people want to have white teeth but very few people want to pay the prices or spend the time to go to the dentist. Needless to say, the demand is there! Did you know that you can set up a tooth whitening kiosk at a mall, street fair, salon, or anywhere in between?
Luckily, tooth whitening isn’t something that requires a high level of medical or technical skill. You can easily start your own tooth whitening business by franchising a kiosk. These kiosks usually offer whitening with LED lights and peroxide gel.
To rent a kiosk, you’ll usually need to pay rent in excess of $1,000 per month at most malls—and some may want a percentage of your sales. You’ll need to do your research on this ahead of time. It’s also worth looking into franchise agreements to find out what percentage of sales your franchising company will request back, as well as whether you have to purchase whitening equipment separately.
Liability can also be a concern, so you may want to invest in insurance. There are ways around needing insurance—some kiosk owners will have customers put whitening trays directly in their mouths themselves—but it might be a smart choice to just pony up those extra funds in advance.
Also, some states have regulations in place regarding tooth whitening, so look into what restrictions are in place where you live.
The potential to make serious cash is here though. If you charge $150 per whitening job—the average at most kiosks—you will only need a few customers a day to make a six-figure salary (before expenses, of course). Plus, there’s very little startup cash required, so you can make a reasonable amount of money in a short period of time.
Pet Walking
If you’re good with animals and don’t mind a bit of exercise every day, you may want to consider starting a pet walking business in your spare time. This isn’t something that will be profitable everywhere—in fact, dog walkers in urban areas will probably be more successful than those who live out in the boondocks.
However, as long as you have a ton of energy and time to dedicate to this kind of small business, it requires just a hundred dollars or so to get started. You may want to print out some cards, flyers, or other marketing materials, but in most cases, an active social media presence is all you need to market your business. Some people might be required to have a business license (this only applies in certain areas and if you are walking several pets at once).
Also, if you really love caring for animals, you may want to consider animal breeding and boarding. This will require a bit more experience along with licensing, training, and certifications in certain areas. It could take you quite a bit of time to get established.
However, purebred dogs, in particular, are in high demand. You will fetch high prices for some breeds of designer pooches! Once your pet walking business really gets going, breeding and boarding (or potentially even grooming) are other avenues you can consider investing in.
Cleaning
Believe it or not, home and commercial cleaning has the potential to be quite a lucrative side hustle—especially if you are a cleaner in a certain niche. For example, eco-friendly home cleaners or those who specialize in crime scene clean-up (not for the faint of heart!) can fetch much higher prices than regular house cleaners.
You’ll need to invest in a few basic items, most of which cost far less than $5,000 combined. If you don’t already have a vehicle to haul around your supplies, that will be your most expensive budget item. You may also need to invest in liability insurance, certifications (necessary for many specialty areas), gas, protective wear, and cleaning supplies.
Your earning potential for cleaning services will depend primarily on the hours you work, what you charge, and your niche. You can grow your side hustle into a full-time gig by adding employees to expand your reach—or even by joining a franchise, such as Jan-Pro. Be prepared to spend some time on your feet as you are getting started, too.
How much time and energy you need to spend growing your cleaning business will depend on your reputation. The quicker you can become established in your community, the less work it will take to build a regular client base. Become trusted and well-liked, however, and you’ll soon find that you can charge whatever rates you want—within reason, of course—and spend fewer hours on your feet.
MLM
Lots of people view MLM, or multi-level marketing, as a sleazy way to make money. The reality is, however, that this kind of self-employment is a great way to make some extra cash on the side with minimal startup investment.
The beauty of MLM is that you don’t have to have a ton of money to get started. How much overhead you will be responsible for depends largely on the MLM you partner up with. Some companies, such as Cutco, charge MLM partners to buy demo products, while others, like Primerica, charge users initial registration fees.
MLMs are pretty simple at the core. You sell one type of product or service, and you get a commission. Once you are successful at making a few sales of your own, you can employ your own salespeople and get a cut out of whatever they sell, in addition to your own sales. The better you get at your job—and the more people you have working under you—the more money you make.
The key to starting this kind of company is to stay savvy and competitive at all times. Do your research on the MLM you want to join and also ensure that it’s a product you really want to get behind. MLMs tend to get a bad rap because they are closely related to pyramid schemes, which offer money simply for recruiting people (and not for selling good, useful products).
You’ll want to invest in regular coaching, marketing services, and more. It will cost you some money, but as long as you stay committed, this business idea will really pay off. In some cases, you may even be able to work from home with minimal time “in the field” each week.
Lawn Care
Like starting a handyman business, opening up a lawn care business is virtually recession-proof. Everybody has a lawn that needs to be mowed, but nobody wants to spend the time to do it.
You may also be more likely to book solid, well-paying work if you live in an affluent area. You’ll need to invest some money in initial startup expenses, like the cost of trimmers, mowers, seeders, and other gear. In some cities, you also need certifications, a business telephone line, and liability insurance.
All of these items should cost you far less than $5,000, however. The beauty of lawn care businesses is that there is always room for expansion. Once you get your legs under you, you can hire more workers or even outside contractors, like tree trimmers, to help you handle larger and more specialized jobs at a certain home.
If you love being outdoors, starting a lawn care company is the way to go. In some places, you may only have to work six months out of the year (spring through fall) in order to earn an impressive income that can support you throughout the winter months, too.
Vending Machines
Starting a vending machine business is probably one of the easiest—and therefore, smartest—things you can do. You’ll pay a few hundred dollars to buy the vending machine, and you may have to pay a locating company to help you find the right location for your machine.
However, if you’re lucky enough to have a well-placed machine, you could make more than $50 per week. Considering there is virtually nothing you have to do to start and maintain one of these small businesses—besides restocking every week—investing your $5,000 or less in vending machines is a smart choice. The time required to maintain a vending machine business is minimal.
What to Consider: Is $5000 Enough to Start a Business?
If you’re considering starting a business, don’t delay your dream any longer. Contrary to popular belief, you don’t need a ton of startup cash to do so. All you need is a bit of motivation and a strong entrepreneurial spirit.
Having a bit of money saved up—whether that’s from a tax return or from a generous gift—can really help you accelerate your progress toward achieving your dreams.
When you’re first getting started, your best bet is to be as organized as possible. Make sure you have a clear business plan and a vision for where you want to take your business. Have at least a working idea of what you want your business to look like five, 10, 15, or even 20 years from now.
Is this something you have always dreamed of doing? Or are you simply looking for a side hustle to provide a bit more money to help make ends meet?
Either way, knowing where you want your company to go is wise. That will enable you to articulate a clear business plan and to come up with realistic, workable financials. You will need to have some money saved for overhead expenses (also known as “startup costs”) that are non-negotiable when it comes to starting your company.
Don’t forget the recurring expenses of your side hustle, too. It’s wise to keep a little bit of money in savings just in case unexpected expenses (like broken equipment that needs to be repaired or legal fees) pop up on you. The time and energy required to maintain your side hustle can’t be ignored, either.
However, those are small logistics to worry about. Once you have them taken care of, you’ll be free to pursue your dreams as a small business owner.
There are all kinds of businesses you can start with very little cash. With a bit of creativity and recognition of your own personal strengths, you’ll be making money and pursuing your entrepreneurial dreams in no time.
