Starting a new business is always a risky venture and one of the things that a budding entrepreneur can do to manage their risk is to start a business while retaining their day job. At first glance that might sound a little crazy – after all many people swear that it should be “all or nothing” when it comes to startups but it’s a good idea.
Researchers from the University of Wisconsin-Madison found that people who hold down their job and start a business are far more likely to succeed than those who go all in on a new venture and quit the day job.
The approach also doesn’t mean that you can’t eventually become a corporate behemoth; Steve Wozniak co-founded Apple whilst still working for Hewlett-Packard. Henry Ford started his automotive group when working for the Edison Illuminating Company.
But how do you go about starting a business while you are working a full-time job? We’ve got some hints that should point you in the right direction.
Get The Money Under Control
It’s money that makes the modern world go round and it’s money that you want to keep an eye on when you start a new business. While keeping a full-time job going can help ease the financial burden of your initial costs – you do need to make sure that you understand the costs and that you are accounting for them with your salary.
You’ll want to have a “cash cushion” set aside to cover unforeseen costs – such as travelling to meet vendors or potential customers or for moving the idea from the drawing board to manufacturing a prototype.
Ideally, you should also have a plan for when it’s time to transition from part-time entrepreneur to full-time business owner too. You want to make sure that the new business is generating enough revenue that it won’t leave you destitute when you make the jump but at the same time – you probably don’t want to put that decision off forever; there comes a time when a business, in order to reach its full potential, requires full-time focus and energy.
Make Sure You Are Allowed to Start a Business
Get your employment contract out and go through it with a fine toothed comb. What does it say about working for yourself? Many contracts forbid employees from taking up alternative employment. If you intend to work in the same space as your employer – you may well find that they have a non-compete clause that could leave your business grounded.
You should also be very wary of all inclusive intellectual property clauses in your employment contract. Some employers demand the rights to everything you create while you work for them – including things that you create in your own time. There’s very little point starting a business when your former employer can just turn up any time with a lawyer and grab all its assets out from under you.
If there’s nothing in the contract about working for yourself; you may be legally allowed to start a business but you might want to find out your employer’s attitude towards working for yourself too. An “at will” employee can be dismissed all too easily and you might find that an angry boss can leave you stranded without your planned safety net.
In many cases, however, employers won’t mind if you run a side business as long as it doesn’t distract you from your day-to-day work. You’ll need to plan how to ensure that the two halves of your life don’t conflict. It can be challenging when you work Monday to Friday and standard office hours to have the meetings you need with vendors and customers – you may need to tap into your paid vacation time to get things done for the business every now and again.
If you’re going to try and run a full-time job and a part-time gig it makes sense to try and unburden yourself of work wherever possible. Outsourcing used to be the option available only to the biggest of businesses but today – there are numerous ways to outsource even the smallest task.
Freelance sites such as Upwork.com, Freelancer.com, 99designs.com, etc. can put you in touch with a range of professionals in almost any field of human endeavor. That’s not to say that you shouldn’t do the work that interests you – that’s part of the joy of running your own business; it’s just that you should get rid of anything that you can afford to get rid of that isn’t an essential use of your time.
You could even hire a receptionist or personal assistant to act virtually for your new business and it shouldn’t cost more than a couple of dollars an hour to get someone in India or the Philippines who speaks good English to take care of this for you.
Don’t Cross Lines Between Work and Personal Projects
That means don’t work with clients who are already working with your day job’s business unless the relationship has been approved, in writing, by your employer. Don’t work on your own projects on company time – that’s a great way to get sued for abusing company resources and a sure fire way to get fired.
You need to compartmentalize between the work and your business; anything less can leave you open for legal action and serious reputational problems further down the road.
Leave Some Time For You
When you’ve got a full-time job and a side project – it can be really hard to leave some space for yourself in your schedule. If you don’t though; you’ll end up burning out.
You still need to eat healthily, sleep well, get some exercise and maintain personal relationships. These are the core components of a balanced life. Sure, you’re going to have to make some sacrifices as you push towards that point where you can quit your job and work full-time on your own business but don’t make too many sacrifices. There’s nothing to be gained by having a heart attack during the process.