Making the Band...With no Record Company?

Of course nowdays, when a band wants to make it to the big time in their career they turn to the many record companies. The record companies are the people who gurantee you fame and money, which is why getting signed to a record label is the dream of all beginning singers and bands. But what if there were no such companies of record labels to promote your band, what would you do? How would you get others to know about your music and listen to it; how would you promote yourself and get compensated for your music? If I had a band, (which I did at one point in my life) we would promote ourselves without a record company by reaching out to the people and advertising ourselves as much as we could.
First of all, starting a band does take money; money to pay for any equipment, gas money for driving to gigs, and to make your first cd for people. What me and my band would do first is budget what we have to buy instruments and equipment; then we would play at as many gigs as possible, and for free. By doing this, people will begin to recognize you and listen to your music more; by playing in parks, festivals, fair's and even carnivals or birthday parties, and most importantly battle of the bands shows. By playing all over constantly people will notice your band, and perhaps grow to like it and say "Oh yea they played this song the last time I saw them, I like it too it's catchy". Then after you have promoted yourself, and probably broke, you make a demo cd of one or two songs, preferably the two that you play most at your shows that people seemed to enjoy. After making this demo, at the next ten or twelve gigs, you have a close friend of the band sell your cd's to the people for a cheap price of five or seven dollars. Hopefully, you will sell all your cds and people will enjoy your music more and more. Then after all of your cds are gone and you have made profit, it is assumed people enjoy your music and want more; so you make a full cd of twelve or ten songs. By then big time gigs will want you to play, because they have heard so much about you from the people, and the radio ask fot your demo and you get more promotion from that too. In time, you are playing arena shows and making money off your cd and the people love you. You have fans now and you have a buisness of making your music for people to enjoy.