2 / 13    

11 Ways to Finance a Start Up

Entrepreneurs can “fund’’ the first stage of their business by using their own unpaid labor and resources to create value. Rather than contributing cash, they might write code for a new iPhone app or build a workshop in their garage.

They did it: Facebook is launched from a Harvard dorm room by Mark Zuckerberg, Dustin Moskovitz, Chris Hughes and Eduardo Saverin.

Advantages: By investing your own resources without outside funding, you develop an idea on your own time. You control the decisions and any intellectual property you create.

Cautions: If you have partners, make sure you get full credit for your contributions. Draw up a written “deal memo’’ on the ownership percentage for each partner. A truly original idea conceived in an instant can be worth hours of computer programming, says M.J. Bogatin, an Oakland, Calif., attorney who has advised Bay-area start ups.