Making The Transition From Employee To Entrepreneur

Since I was a kid, I wanted to own a business. But, my professional life didn’t start with entrepreneurship. I went to college and worked as a systems programmer for a big, multinational company.

While there (and feeling like a cog in the corporate wheel), I started my first company in a spare bedroom of my house. A year later, I quit my job to be a full-time business owner.

The transition from salaried worker to self-employed was rough. After over thirty years as a serial entrepreneur, I know a thing or two about quitting a job to start a business. Before you leave your nine-to-five, make sure you consider the following points.

Are you ready to be your own boss?

Transitioning from employee to entrepreneur is as exciting as it is difficult. The decision to do so shouldn’t be taken lightly. Before quitting your job, you need to ask yourself some tough questions about launching a startup.

Think about why you want to become a business owner. Do you have an entrepreneurial idea that you absolutely need to follow and see where it goes? Or, do you hate your job and need a change?

If you answered “yes” to the second question, starting a business might not be a solution, especially if hard work, high stress, and low pay are reasons you don’t like your job. When you launch a new company, all three of these situations are inevitable. Finding work at another company could be the break you need.

I'm not trying to discourage you. What I'm saying is, starting a business is hard. It’s not a quick fix for when you dislike your job. It’s committing to a dream and persevering through daily challenges that come with business ownership.

If you’re ready to be your own boss, it’s time to start thinking about going from an employee to entrepreneur. The more you prepare, the better chance you have of succeeding as a business owner.

The truth about taking the leap

When it comes to starting a business, a lot of folks talk about “taking the leap.” You might picture the aspiring entrepreneur tossing a stack of papers into a wastebasket as co-workers line the halls and applaud.

The person boldly kisses corporate life goodbye and dances out the door to a bright future.

In reality, this Hollywood dream can turn into an entrepreneurial nightmare.

Business success doesn’t come from taking one big leap and never looking back. If you want your business to have longevity, start small and start slow.

My former business partner and I leaped into business unprepared for our first startup.

We didn’t research what we were getting ourselves into and took our entrepreneurial leap of faith with no turning back. Although we came inches from business bankruptcy, we somehow steered clear of disaster.

Save yourself time, money, and headaches by preparing before you quit your day job.

Building your business in stages reduces risks and reaps more rewards in the long run. Take a look at the following tips.

Develop your idea and find your niche

Once you decide to be an entrepreneur, people will ask what kind of business you’re going to start. It’s a fair question. But, it’s not as easy to answer as you might think. Before launching your startup, you need a clear picture of what you will do/sell.

The best business ideas solve a problem. Aim to fill holes in the market and provide something consumers need. To find your niche, you need to do some research.

I did a lot of research for my ATS recruiting software business in the 1980s. Going through the phone book, I called businesses to find out what owners needed. I also researched industries at the library. After a lot of investigating, I found that software for job recruiters had the most potential.

Today, finding industry information is much more convenient. Search the web for ideas and tailor them to your experience, interests, and desired niche.

You should have your business idea developed before you quit your job. But, don’t work on your startup while you’re on the clock.

Neglecting your duties during company time could create issues with your employer.

When you quit your job to start a business, your employer is a part of your network and could help you in the future.

A good business owner doesn’t burn bridges. Develop your business idea outside of work to avoid animosity between you and your boss.

Test market trends

You have your business idea, but how do you know if it has potential?

Transitioning from employee to entrepreneur is a big step. You don’t want to make the wrong move with an idea that flops.

To project the success of your idea, test it.

Try out your idea on small groups with a market analysis to gain insight on potential customers, competitors, and the industry. Conduct interviews, surveys, and questionnaires about your offerings, and see how people react.

Also, look at current market trends and listen to what experts have to say. Pay attention to key issues shaping the direction of the industry and use them as a guide.

Get a business plan

After you gather information, it’s time to focus on a strategy.

Refine your idea with a business plan that acts as a roadmap for launching your business. A business plan details what you will offer, who your target customers will be, and how you will fund the company.

Your business plan can be anything from a simple outline to a formal document. Decide when you will open, where you will operate, and what inventory and equipment you need. Plan your marketing strategy and business budget.

And, determine if you’ll be bootstrapping your business, or if you need to secure startup capital.

Chances are, you won’t have every detail figured out before you start the business. But, preparing for major parts of your operations is key. Countless things will go unplanned. A plan will help you face challenges and lead your business in the right direction.

Build your network

Going out on your own doesn’t mean you have to grow your startup alone. Your connections can help you with business in all kinds of ways.

Your network should include experts who can offer valuable advice, from financial consultants to industry veterans. And, prospective customers should be in your circle. Fostering these relationships leads to long-term customers and a steady inflow of referrals.

You can network with others online through forums and social media channels. Also, do some face-to-face networking at industry events and community organizations.

There are never too many people in an entrepreneur’s network, especially for a new business owner. Always keep an eye out for new networking opportunities.

Making the move from employee to entrepreneur

As you go from earning a regular paycheck to owning a business, take the time to hash out essential details. Being a business owner is not for everyone. But with passion and a solid plan, you are on your way to being a successful entrepreneur.

If you dream of starting your own business, learn from my experience.

Seek the advice of smarter, more experienced people. Learn to decipher the good input from the bad. Trust yourself, push yourself, and always remember—you can do this.

 

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