Why You Don’t Need Capital to Create Wealth

If you believe, as I do, that the path towards wealth is to accumulate income producing assets, then you might be wondering: “How can I do that without capital?” Indeed, that’s by far the most common query I receive from mentees and readers, alike. They assume that it takes money to make money, and that they’re basically stuck until they have more cash. They’ll have to keep saving up until they can afford to buy something that pays revenue. They are wrong.

In January of 2015, I wrote a blog post called “I Got Rich In My 20s. Here’s How You Can, Too.” It described what I did to become financially free by age 26. In that article, I noted that there are two ways to gain assets. First, you can buy them, which requires money. That’s also known as investing. Second, you can build an asset for yourself. I did a combination of the two – and I continue to do so today. In this post, I’ll explore two ways to create an income producing asset without using much (or any) of your own capital.

Start a business

Starting a business is the primary way to build an asset. The objective is to work hard for several years, create a profitable venture and gradually automate it so that it becomes passive. That might mean hiring a manager or developing systems that can run without your constant attention. Done correctly, you can translate medium-term effort into long-term passive cash flow.

It’s difficult to recommend a “good” business. Many ideas can be lucrative, but what often defines their success is execution. How hard does the entrepreneur work? How passionate and committed is she? In many cases, it can depend on personality. I might find a business exciting that you think is boring. So instead, I’ll make the following suggestions.

When thinking of a business, try to envision how you might exit from it after it’s built. That might seem counterintuitive at this early stage, but it’s actually quite important. Many who have a small business can never leave. They work tirelessly because it requires their absolute devotion all the time. They essentially have a job that never ends and provides no vacation or insurance benefits.

Consider a business that can be scaled in the future, perhaps with some of the following features:

  • Managed by employees
  • Recurring revenue from subscriptions
  • Customers who buy repeatedly
  • Continuous flow of new customers

To be clear, those attributes don’t have to exist today. However, if you could build them into your business, then you’ll have a better chance of exiting from it later on.

For instance, if you wanted to become a self-employed realtor, consider how you could make it a passive venture in the future. Sure, you could make money today by selling homes. But what if you wanted to take a two-month vacation? What if you became sick? What if you didn’t want to work anymore? How could you scale your business to accommodate those scenarios? Here are some ideas:

  • Hire an assistant to book your appointments
  • Create a website and capture leads
  • Use an email marketing software
  • Hire associates and retain some of their sales commissions
  • Start your own brokerage and hire realtors under you

Here is a list of 100 businesses you could start. As you go through them, consider which ones would be difficult to scale and avoid them.

If you don’t already have an idea in mind, or if that list doesn’t help, there are two kinds of business models that I could suggest: online businesses (e-commerce) and network marketing. These are scalable by definition.

Note: Russel Brunson has a great program, called DotComSecrets X, which shows you how to build a profitable online business.

Acquire the asset with someone else’s money

You can acquire an asset, like a piece of real estate, by using money that you raise from investors. For instance, imagine that you want to buy a small apartment for $100,000. You believe rent prices will rise, so your plan is to hold it for the long term as a passive income investment. You approach an investor and strike a deal: she will put up the money, but you will be responsible for renovations, finding tenants and maximizing the value of the apartment. As such, you agree to split the profits 65/35.

In that example, you purchased an asset by using somebody else’s capital. You’ll now receive rental income for the foreseeable future until you decide to sell the property. You have ownership in an apartment, but you didn’t pay a cent for it. Instead, you used your network, intellect and effort.

Obviously, that 100-word description doesn’t do justice to the complexities of working with investors. It’s a broad summation. However, you can expand the idea of raising capital to other assets, not just properties. Perhaps there’s a business you want to buy. Could you use an investor’s money to purchase the company, while you then operate it? More about this concept here.

Note: I’d recommend “The 5 Million Dollar Book” by Stefan Aarnio for more on buying real estate with investors. It’s a great resource – and it’s also free.


While you need assets to have passive income, you don’t need money to acquire assets. Having cash helps, but it is not mandatory. It is a tool that you can use, but it can be replaced with hard work and resourcefulness.

About The Author

Alexis Assadi

Alexis Assadi is an investor, entrepreneur and writer, who advocates for making high-performing income investments and the lifelong pursuit of financial intelligence. He is a shareholder and director in three companies that provide funding to small businesses, entrepreneurs and real estate projects. His most recent venture is a firm called Pacific Income LP.

Facebook Comments


  • Stella

    Reply Reply August 8, 2017

    HI Alexis,

    I’m trying to download your articles and subscribe to your Mentorship Program but I haven’t received anything in my email account. Can you check on that please? Thanks,

  • Nyerho

    Reply Reply August 8, 2017

    I know this is a small, insignificant thing, but I really appreciate your use of female pronouns. As a female who is interested in property and investing, a lot of resources, intentionally or not, assume the reader is a male. Assume successful entrepreneurs/investors have masculine traits, (“alpha male”) tout the rewards of entrepreneurship as super cars and young, hot women, (not to say that there aren’t women who like that but you can tell it’s aimed towards young men) and/or generally explain concepts through the lens of masculinity. I’m sure you know what I mean. So it’s always so refreshing to read your articles and see that whole idea be subverted. For once the savvy cash rich investor is a woman. Finally, I hear about a successful entrepreneur who answers to “she/her” pronouns. It actually feels inclusive towards all readers and reflects your progressive and open minded mentality, Alexis. So please keep educating people with your enlightening blog posts, ebooks and mentorships. And a few years down the line, when I achieve the kind of success I want through the unconventional route of entrepreneurship, I’ll know exactly who I owe it all to.

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