Many people get stuck working at a job to make money so they can pay their bills and aren't sure how to make the transition to a full-time entrepreneur. This article gives a really interesting perspective on how to make that transition.
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Source: Solo Biz Coach
Are you dreading being at work right now, and longing for the day that you can tell your boss that you quit? Are you saying to yourself that you could be growing your business so much faster if only you didn’t have a full time job?
I know how you feel. I have been there myself. At times I have pined for the opportunity to just quit my job and focus full time on my business. But, at the end of the day, I realize how lucky I am to be able to build a business while still being an employee.
Having a full time job while building a business gives you a huge advantage, and you need to embrace this advantage. Your employer in many ways is funding your new endeavor by paying your salary while you build you business in your free time.
Don’t minimize this opportunity. There are many people who have recently found themselves laid off, unable to find a job, that are building businesses just to survive. You are so much more fortunate.
Once you realize your full time job is an opportunity, it is time to maximize that opportunity. My goal with this post is to give you a plan to take advantage of being an employee while you transition to being an entrepreneur.
How To Move From Employee To Entrepreneur
Create a Realistic Time Frame For When You Will Be Able to Quit
One of the first questions I get asked is, “How long will it take for me to grow my business to the point I can quit my job?” I would like to have a simple answer to this question, but the truth is that this depends on a lot of factors -
- What income do you need to generate to quit your job?
- How long will it take you to generate that kind of income?
- Do you have savings that you can use as a bridge loan to yourself?
Since all of these questions are personal to you, think about these long and hard, and determine a realistic time frame for how long it will take you to grow your business to the point you can make it your full time job.
As a general rule of thumb, most people can make the transition in six to twelve months. For me, I am giving myself two years to make the transition because that is how long I think it will take me to replace my income.
Create a Learning Plan
There is a ton to learn before you start your own business. Use your transition time to learn how to run a business successfully. The goal here is to learn all of the business basics while you are still employed.
I think that the best way to do this is to develop a learning plan that lists the areas of knowledge that you need to learn and then map out how you are going to learn this information. Understand your strengths and weaknesses. What skills do you possess? What skills do you need to learn before starting your business?
There are two categories of information or skills that you need to learn. The first category is information needed to run your specific business – industry specific knowledge and product specific knowledge. The second category of information is general business information, like managing finances, communication skills, marketing, sales, personnel management and taxes.
Here are some great resources to get you started:
- Download my free guide titled 7 Steps To Starting Your Own Business
- Visit SCORE.org and look through their great business resources
- Join my Solo Biz Tribe and receive a free weekly email designed to give you an actionable task each week to help you grow your business
Develop Your Life Plan
This is a topic that I am passionate about, and feel that too many aspiring entrepreneurs neglect. If you want to make sure that your new business venture fulfills you and makes you happy, you need to know what you want out of life.
The worst mistake that you can make is to build a business that doesn’t fit your life goals. You will be just as miserable as you are with your current job.
I am currently writing a life planning workbook for small business owners. As soon as I have finished this, I will be sure to let you know about it.
Develop a Network of Mentors
Before going out on your own, take this time to develop a great network of mentors. Find people who have built businesses themselves. Connect with peers who are also starting new businesses. This is also a good time to interview a few lawyers and accountants. These are two professionals that you need when launching your business.
You should also think about hiring a coach. Despite being a coach myself, I have hired a coach to help me build my business. We all need someone to help us focus and stay on track. You can hire me as your coach here – small business coaching.
Develop Your Financial Plan
You have to be on solid financial ground prior to leaving your job. Take this time to make sure that you have a strong financial plan in place so that when you are ready to quit your job, your finances are in order. Make sure you save enough money in your emergency fund, and pay off as much debt as your can.
This is a big part of my transition plan. I still have a good bit of law school debt that I want to pay off before I go out on my own.
Develop Your Business Plan
Get your business plan in tip-top shape. Do your market research. Make sure you know who your customers are and what their problems are. Understand what you are going to sell them.
You have to get your thoughts down on paper to make sure that you have thought through all of the details in your business. Creating a business plan is a great exercise to make sure your have rigorously thought through these details.
Start Building Your Business
Last but not least, start growing your business. Start making sales. There is no reason why you have to wait until you quit your job to start selling. In fact, you must be out there selling before you quit your job.
You will never start a business by planning. You start a business by doing. Use this transition time to get your revenues up. Grow your bottom line so that you can support yourself once you move from employee to entrepreneur. But, don’t get me wrong, you have to do the planning too. One of my favorite quotes is, “If you fail to plan, you are planning to fail.”
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One of my favorite parts about this article is the whole idea of just getting started.
There is only now. "Someday" will never come.
Here is a second article on the same topic. This one is an interview with Melinda Emerson, author of the book, "How to Become Your Own Boss in 12 Months."
Emerson takes a slightly different approach.
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Source: Succeed as Your Own Boss
Q: What makes your book different from all the other start-up business books?
Melinda Emerson: Become Your Own Boss in 12 Months provides a realistic, month-by-month planning guide to start a sustainable and profitable small business. Become Your Own Boss in 12 Months is not a book about writing a business plan; it’s about planning your successful small business.
Q: Why did you write Become Your Own Boss in 12 Months?
Melinda Emerson: My mission as the SmallBizLady is to End Small Business Failure. I wanted to develop a tool for people who are unhappy with their jobs and look to transition into small business ownership. I also wanted to discourage people from just quitting their jobs without a well-researched plan. Too often I got calls from people seeking my advice about starting a business—after they had already quit their job — which is just too late to begin planning. Since the recession began, small business owners have even less time to hit it big with their entrepreneurial ideas. I developed the Emerson Planning System to help plan a successful small business which is illustrated in my book Become Your Own Boss in 12 Months.
Q: Why does it take 12 months to start a business?
Melinda Emerson: 12 Months is an ideal time-frame to start a business, it’s not meant to be restrictive. I have been an entrepreneur for more than 11 years. Based on my experience, I believe the longer you plan, the more research you will do, and the more money you save, the more likely you are to succeed in business
Q: What if you don’t have 12 months?
Melinda Emerson: Sometimes people are forced to start sooner. This is triggered by layoffs, getting fired, buyouts or retirement packages. I only planned for three months with my first business, but the challenge with that approach is you learn plenty of lessons the hard way, and that can be expensive. If you live by a budget, have your debt under control, and have a significant amount of savings, you will be able to start your business much sooner. Depending on your individual situation, it may take more than a year to get your personal finances in order.
Q: How did you become the Smallbizlady?
Melinda Emerson: When I first began using Twitter, my own name was taken, so my friend @cathywebsavvypr and I brainstormed a name for me that would describe what I do. She came up with @smallbizlady and I have been that ever since. It was probably the best branding decision I ever made. How I really became a Smallbizlady was in 1999 when I became an entrepreneur, after my career in television as a news producer. I started a television production company called Quintessence Multimedia. About five years into my business, I started speaking on panels and doing workshops about small business start-up, web development and marketing techniques. Then, I got calls from people looking for help to start a business. I began by sending would-be entrepreneurs a one pager with start-up tips. That was expanded into a special report, 44 Things To Do Before Going Into Business, which was the basis for my book, Become Your Own Boss In 12 Months. Over the years, I joined the National Speakers Association and I became a business coach and expert on small business best practices. I thought the best way to help entrepreneurs would be to provide a step-by-step proven method to start a successful small business.
Q: Who should start a business?
Melinda Emerson: Anyone with a solid, profitable business idea, willing to learn the business of running a business can start a successful small business.
Q: Why do small businesses fail so often?
Melinda Emerson:
No Life Plan—You need to develop a life plan and then build a business around that.
No Network—People do business with people they like and with people they know. Who do you know and, more importantly, who knows you?
Lack of Target Market—You have limited time and limited resources. Choose a niche so you can focus your marketing efforts.
Undercapitalized—If you do not save enough money to run your household for at least a year and fund the business, you may not be able to hang on until the business can generate any real revenue.
Lack of Fiscal Discipline—Do you run your business with a budget? Do you just rob the cash register when you need some cash? Do you make business decisions based on up-to-date financial information?
Q: How do you transition from a job to starting a business?
Melinda Emerson: Inside Become Your Own Boss in 12 Months, I write about the Emerson Planning System which is a six step system to transition from having a job to starting a business. It includes developing a life plan, a financial plan, validating the business concept, developing a marketing plan, the business plan and then finally starting the business.
Q: What is a Life Plan and why and do I need one to start a business?
Melinda Emerson: You need a Life Plan before you ever write a business plan, because you need to make sure that the business you start is the right business for you.
Q: You write a lot about personal finances and business planning. Why is that so important to starting a business?
Melinda Emerson: Your ability to save will be the key to whether you are financially able to become an entrepreneur.
Q: What are the 7 Essential Principles of Small Business Success?
Melinda Emerson: Throughout the past seven years, I have interviewed hundreds of entrepreneurs and business executives. After listening to what they said about running their businesses and observing how they did business, I realized that there were seven things they all had in common. They include having an entrepreneurial mindset, utilizing strict fiscal discipline, and having a kitchen cabinet of advisors. They make use of a well-defined brand identity; have a niche market customer, excellent customer service, and a firm understanding every day of their cash position by carefully managing their banking relationship. Using these principles can help any business run at its best. It’s the gold standard all businesses need to strive for from the very beginning.
Q: Who can benefit from this book?
Melinda Emerson: This book is for anyone looking to create a plan to fire their boss and start a small business. It will also help people who are within a few years of launching a new enterprise. I have also heard from seasoned business owners who tell me that this book could serve as a professional development course or a great roadmap to reinventing a struggling business.
Melinda F. Emerson, also known as Twitter’s SmallBizLady is a seasoned entrepreneur, professional speaker, and small business coach whose areas of expertise include small business start-up, business development and social media. She is the founder and CEO of Quintessence Multimedia, an award-winning strategic communications firm. She has created productions for such companies as Johnson & Johnson, Verizon, Enterprise Rent-A-Car and Comcast. Her bookBecome Your Own Boss in 12 months; A Month-by-Month Guide to a Business That Works!”was released in March 2010 by Adams Media.
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What's interesting about Linda Emerson's take on this process is that she sets a specific time frame of 12-months. It's good to have a deadline with any goal. Going from employee to entrepreneur is no different. Plus, her take on why small businesses fail is very insightful.
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