How much money do you need to spend to generate publicity about your new company? The answer may surprise you.

One of the biggest misconceptions many executives have about public relations is what it will cost them to generate news coverage about their companies. This is especially true of cash-strapped entrepreneurs who think they'll need to pay a million dollars to get a million dollars' worth of publicity about their products, services or expertise.

Nothing could be further from the truth. Indeed, the public relations "hall of fame" is full of resourceful individuals who have spent little or no money to generate reams of news coverage about their businesses.

They discovered that the size of your wallet isn't as important as the story you have to tell about your start-up. This is because all news organizations are basically storytellers. They're looking for stories to tell readers, viewers or listeners. If you can identify or create a story related to your business that might interest the public, you'll make it easier to interest news outlets in your company.

Invite the Press to a Launch Lunch

When it was ready to launch in August, 3dvillage.com, a media publishing and Internet content marketing firm in Cary, N.C., used a relatively inexpensive approach to generate press coverage. The company arranged a launch luncheon for the press at Michael Jordan's 23 restaurant in Chapel Hill. Besides free food, it had a good story to offer: a demonstration of its newly completed online interactive 3-D walking tour of Chapel Hill's historic downtown business district.

More than 40 journalists in the ResearchTrianglePark area of North Carolina were invited, says Chief Marketing Officer Greg Meluch. Their color invitations, which were placed in clear plastic champagne bottles with an inflatable globe, were hand-delivered. More than 30 journalists attended, with many preparing stories about the launch of the company and its new product.

All four major local television network news stations came to the party and did stories that evening about the site. Several local newspapers and radio stations also did stories about the event. MSNBC and CNN picked up on them and ran their own broadcasts the following weekend.

How much did 3dvillage have to spend for what was estimated to be "hundreds of thousands of dollars' worth" of media coverage? The tab, including the cost of food, came to less than $1,000, says Mr. Meluch.

With a background that includes 18 years in sales and marketing for IBM, Mr. Meluch was used to spending millions of dollars to launch a new product. But, he says, "I never received a better return on the investment of my dollars than I did for this event."

3dvillage's launch luncheon was successful because the company gave journalists a story that interested not just North Carolina residents, but anyone who follows high technology. But you don't need to feed the media to get a story done about your company. Often, you only need to send a well-written news release to reporters, editors and columnists or make sure information about your company is easily available on the Internet.

Strategic Internet Links Pay Off

Pamela Previte O'Brien, a Houston interior designer, learned the value of linking her Internet site to others after taking an interior design certification course at Lauri Ward's Use What You Have Interiors Inc. in New York City. After the course, Ms. O'Brien spent $10 on software to design a home page and linked it to Ms. Ward's Internet site.

Ms. Ward appeared on Oprah Winfrey's television show in September and mentioned her Web site. After the show, a reporter with the Fox News TV station in Houston visited the site to track down a local interior designer to interview for a story. Her research took her to Ms. O'Brien, who became the subject of a story on the Fox Morning news program. The 15-minute piece included a before-and-after case study of a family room Ms. O'Brien designed. From all the free publicity and exposure in Houston, she gained two new clients and several new business leads.

Most start-up companies operate on a shoestring budget and can't spend much on public relations and other marketing activities, says Arnold Sanow, a business-marketing consultant in Vienna, Va., and co-author of "Marketing Boot Camp" (Kendall/Hunt Publishing, 1994). But, he says, "the good news is that a company's ability to get news coverage has nothing to do with money, [and] everything to do with their ability to tell the story about their company in an interesting and compelling manner."

Three Tips to Help Tell a Story

In short, you must be a good storyteller. Here are some storytelling tips that can be implemented either for free, or for just a few hundreds dollars:

1. Prepare and send a news release

Write a short (two-page) release about the launch of your company that includes the basic information reporters want: who, what, when, where, why and how. At the top of the release, include a short, attention-getting headline and your phone, fax, and e-mail information so reporters can contact you.

Prepare the release as if it were a story that was actually published in your local newspaper. Don't send text that's a reformatted version of an ad, brochure or your company's mission statement. Identify or create the strongest possible story angle or news hook for your news release. One company spent $1,500 to purchase two questions on a national public opinion poll related to its business. Highlighting the results of the poll in the news release helped draw attention to the company's announcement.

Distribute the news release electronically via PR Newswire or Business Wire, two private news release distribution services. For about $500, any company can have releases sent electronically to thousands of news organizations nationwide. While this may seem expensive, you'll ensure that many journalists know about the launch of your new business.

Use a company such as Media Distribution Service based in New York City to send your release via mail, fax or e-mail to a list of targeted reporters who are likely be most interested in doing a story based on your news release.

Post a copy of the release on your Web site. The Internet quickly has become an important research tool for reporters. If you publish the release on your home page, an even larger audience will see the announcement.

Phone news organizations that you hope will do a story about your start-up. Ask to speak to the editor or reporter who would most likely be interested. When you reach him or her, briefly explain your story and why you think it's important to the audience.

Identify or create visuals that will help demonstrate an aspect of your company, whether it's a chart, graph, logo or pictures that show your product or service being used. Visuals are essential if you hope to get a story on TV about your firm. They also can illustrate print articles.

2. Become a resource to the media

Journalists are always looking for experts in various areas. For an annual fee that depends on the size of your organization, you can be listed as an "expert" on a database maintained by ProfNet. ProfNet members also receive regular e-mail notifications about journalists seeking qualified individuals to interview for their stories. (If you doubt that ProfNet works, contact Greg Meluch and Pamela Previte O'Brien, who responded to a query posted on ProfNet seeking entrepreneurs to interview for this story)

Ask newspapers or magazines that you want to cover your company for a copy of their editorial calendars. These are published lists describing the content of upcoming issues or special sections. Depending on the subject matter of these stories, you might make a good source for the reporter. If so, call the editor or reporter working on the article, explain your expertise and offer to be a resource. You also can send a brief memo to editors and reporters at news organizations where you seek coverage and explain which topics you're qualified to discuss if they need experts.

3. Be prepared when reporters call

Don't be caught off guard if a reporter calls to interview you about your new company. Make a list of three or four important points to touch on during an interview and find ways to repeat them during the interview. Also list the questions a reporter might ask about your start-up, and be sure you can answer each one appropriately.

Once your first story about your product or service appears, don't be shy about letting people know about it. Place the article on your Web site and send copies to media contacts. You may be surprised how many reporters become interested once they see other news organizations do stories about your firm.

It doesn't cost much to implement these suggestions. Many companies find that the return on small investments in PR pay off handsomely as stories about them or their companies are read, watched or heard by potential customers. Given the stock market's current jitters, it may be the best investment you can make to help ensure the success of your start-up.

-- Mr. Segal, author of "Getting Your 15 Minutes of Fame, and More!" (John Wiley, 2000), conducts media training, presentation skills and effective public-relations strategy workshops for entrepreneurs. His Web site is www.publicrelations.com.

Email your comments to sjeditor@dowjones.com.