Fortunately, starting a small home based business generally requires much less cash up front than the traditional way of opening a new business. Since you will be working out of your home, you won't need a storefront or the lease and inspections that go with it (but check with your local government - they may still require some inspections of your home based business environment, especially if you are going to have customers or clients entering your home to conduct business). You also shouldn't need to hire any employees, at least not at first.

Inventory can be another problem for your cash requirements. If you must keep inventory, try to limit your actual purchases, especially when you are first starting out. Once your business gets rolling, you should be able to better forecast your inventory requirements so that you have a minimum of cash tied up in product inventory. Consider drop shipping to avoid inventory altogether. You could also become an affiliate of a larger company. As an affiliate, you market the larger company's products but don't control any of their inventory. When you make a sale, the larger company takes the order (typically through their web site), then charges the customer and ships them the product. As an affiliate, you get a commission for the sale, but you are only paying for the marketing you do on behalf of the larger company.

Avoid loans, if possible. Banks and investors probably won't loan you any money anyway, but some beginning business owners are tempted to use credit cards to finance their business. Using your credit to fund your new home business can be convenient, but it can also get you and your business into trouble. Use your personal credit with caution.

If you don't have the cash you need to start your home business full time, consider starting the venture part time. Keeping your day job while getting your home business off the ground can be a great way to get cash into your business without worrying about how you will have money to live on. Once your small business takes off and becomes profitable, you can consider leaving your day job and running your business as a full time owner. Just take into account that once you go full time, you have to pay for all of your health and other insurance needs. In the US, you will also have to pay more taxes, since your employer probably paid 50% of your social security tax, and you will now be responsible for paying 100% of this tax.