If you have zero financial setbacks, unlimited resources, and bottomless funds that will finance your business’ operations through failures (In 2019, the failure rate of startups was around 90%), then stop right now and go back to whatever chore you were doing. But if you belong to the majority – are constrained by real-life limitations (both financial and non-financial), and need a set of guidelines to start a business while still being employed, this article is for you.
Here, we will break down helpful tips and tricks and dissect them thoroughly to help you develop an action plan for your business while working full-time.
Should You Start Your Business While Working Full-Time?
In 2006, Aytekin Tank founded JotForm as a side hustle while working full-time as a senior web developer in an Internet Media Company. Now JotForm is one of the most popular form-building websites in the world.
If you have a business idea that you believe can disrupt the market and transform into an active source of income, chances are you are already daydreaming about handing in your resignation letter to your employer and taking the entrepreneurship route. But before you make such a radical decision, ask yourself, “Will I be able to work full-time and still manage to grow my business into a successful company?”. If the answer is yes, then do just that.
In real life, even if you have validated your product and have the required experience in business growth and development, you cannot simply neglect your responsibilities to family, bills, or paying off student loans and other debts to pursue your dreams alone. All this points to the need of holding a stable job that guarantees a secure future, which is precisely why we highly recommend you to not quit your job before your business achieves a certain level of success.
How To Start Your Business While Working Full-Time?
Entrepreneurship is not easy. Throw in a full-time job that hogs the majority of your day, energy and headspace, and starting your startup becomes twice as much challenging. But with the right strategy, decisions and action plan, you can start your dream business and become a successful entrepreneur.
Let’s delve into everything you must know and do to start your business while working full-time
Read Your Employment Contract
First thing’s first – know your employment contract.
When starting out a business while still being contractually bound to another company, you must ensure that your venture does not breach any clause that may cause you serious legal problems in the future. It is recommended that you verify every document that has your signature on them from a contract lawyer to know your rights, limitations imposed on your business, or even interpret a vaguely written legalese that goes over your head.
Documents or agreements that you need to pay extra attention to are:
- Employment Contract
- Non-Disclosure Agreement
- Non-Compete Agreement
Don’t be afraid to contact your employer or Human Resource Department to clarify any doubt before seeking professional advice; you may realise that you don’t need a lawyer after all and are in the clear to pursue your endeavour without getting fired.
However, you must still go through your signed documents on your own to ascertain that you do not unintentionally break the company’s policy and find yourself in the chokehold of a breach of contract.
Validate Your Product
Once you have read your contracts clearly and verified that you are in clearance with your company’s policy, it’s time to actually get to work. But before you plan on building ahead or rolling out your product or leaving a job, before you get any of these thoughts, validate.
Market Research Survey
A poor product-market fit is a recipe for failure. If your idea does not address a pain point, then there is little to no use to make it into a full-fledged business. That’s why you must conduct a series of carefully designed surveys to understand your future customers.
Identify dead hours and lull stints in your routine, like lunch hour or commute time, and use this time to design effective and meaningful surveys and research questions to learn your target market and customers. If you cannot make up time to collect the actual data, hire temps or external firms to conduct surveys on the channels (online or offline market, specific demographic, etc.) vital for your study.
Analyse Your Findings
After collecting data from surveys, the next step is to analyse it to find answers to critical questions regarding your product, target market and potential customers.
But the analysis phase comes with its challenges. First and foremost, the lack of domain knowledge and the right techniques can exhaust a lot of your time. With a full-time job, investing more time in learning new skills through courses and special training will only result in pointless delays in establishing your business. A simple solution to this dilemma is to seek expert advice.
Reach out to your connections, old or new colleagues, or your old university professors experienced in the field to help you understand your market better and perhaps find loopholes in your strategy. This will not only save up your time but also increase the quality of your work.
Minimum Viable Product
Create an MVP or Minimum Viable Product to validate your assumptions and hence product with real-time customers. You can delegate the software implementation of your product to someone well-adept in app development, be it one of your cofounders or an intern. This will substantially reduce product development costs and make your work manageable with your day job.
If your MVP has survived the trials and tribulations of product validation, then it indicates that your actual product is ready for launch.
Outsource Whenever You Can
When you have just started your business, you do not have enough assets and financial support to hire and pay steady paychecks to full-time employees. But operating a business at any stage requires human resource. Even if you are a solopreneur, you cannot be skillful at everything and have to turn to others for the required services at one point of time.
So what should you do when you want a human service but cannot afford it? In one word – Outsource.
Delegate your business’ tasks that require high involvement or skills or are part of easy routine work (like managing social media handles) to others.
By outsourcing interns, contractors and freelancers, you can prioritise your work, focus on major operations of your business by taking a back seat, and still work at your full-time job.
As an example, consider that you want to set up your website but do not know how to. Instead of learning web development from scratch and creating a basic working prototype that may even fail to serve your purpose, you can outsource a professional to develop your website. This strategy has dual benefits. First, you will save yourself from wasting months-long time reserved for your business when you are not working at your job. Second, the end product will be of high quality and professionally validated.
Don’t Use Company Resources And Time
You must not use company resources to further your personal goals. Whether it is a work computer, raw materials, or any technical equipment you find useful for your business. For example, printing hundreds of flyers to market your business using your organisation’s printer is unethical.
Besides, your employment contract may, in fact, legally forbid you from wrongly using company resources. In the worst-case scenario, you may get accused of Employee Theft for holding company assets without permission. So, even if you can explain your case, it is wise to be on the safe side and avoid any legal battles.
As an added safeguard, we recommend that you document all the sources of your items and purchases in the form of receipts, invoices, bills and email confirmation to prevent any discrepancy with your employer.
Lastly, use every spare minute you get to build your business but do not, under any circumstance, work on it during company hours. You may have a perfectly valid reason for delaying your ongoing project to non-office hours to invest in your side hustle. Still, your employer will not look at the situation from that perspective and may take action against you.
Save Your Earning
Don’t spend foolishly and save every extra cent you make from your business to finance it and achieve your goals faster. When your business starts making money, it’s natural to feel tempted to squander it on your expenses. But you already have a full-time job for that.
Instead, use this money to expand your business’s operations, procure equipment that makes your work easier, cheaper and more efficient, or invest in advertising channels that will drive more customers to your website. Stick to your long-term goals and reserve your earnings for your business’ growth and expansion.
Should You Quit Your Day Job?
Running your business while working full-time is possible but not easy. Even after optimising inefficiencies in your schedule to achieve maximum work output, there will come a time when you will stand at a crossroad between pursuing your current day job and dedicating your time, efforts, energy and resources to your business. So what should you do when faced with such a dilemma? Should you quit your job, or should you continue managing both undertakings without any change?
Let’s attempt to find answers to those questions.
Forecast Your Business
Before you quit your job, forecast the revenue and growth of your business. As a rule of thumb, project where your business will stand in the next quarter, year, and three years. Business forecast gives you more quantifiable information about your business’ future and acts as a powerful tool to attract potential investors for your business.
Validate the future of your business by assessing its expenses and key metrics. Some of the metrics that you should especially focus on are:-
- Gross Profit Margin Ratio
- Operating Profit Margin Ratio
- Total Headcount Per Client
After you have projected the revenue and growth in the years to come, determine whether the numbers are satisfactory enough to sustain you and transform your business into a profitable venture. If yes, then it is a good indicator for you to step back from your current job and drive your full attention to your business.
Do You Have Any Cofounders?
Having cofounders relieves you of some burden of your business and helps you balance the conflicts between additional work and personal life – especially when they are available full-time. This drastically reduces your workload, enabling you to find that sweet spot of stability among multiple responsibilities.
But, is delegating the brunt of your business’ operations to your cofounders the right move when your business needs you? A simple answer is no. When your business calls for your attention and starts growing, and its forecasts are in your favour, then logic dictates that you get more involved in the work and take on more responsibilities of your business, even if it means quitting your full-time job.
Besides, when someone else manages most of your business, it may happen that your vision and what your business starts to become diverges. Even when all the executive decisions are run through you, your day job can pose an obstacle in critical decision-making, especially when you are not aware of every aspect of your startup’s status quo and rely heavily on your cofounders.
Find Funds For Your Business
The next thing that you should consider before quitting your job is the funds that your business holds. Financial support from angel investors and venture capital firms not only help you in your business growth but also provides it with a certain level of credibility – it’s the trust of your investors that further validate your business.
If you have enough funds for your startup that can last you through trials of time, it is wise for you to quit your job and utilise those funds to achieve your goals within the deadline that you promised your investor. Leaving your job becomes imperative when your investor expects you to prioritise your business before other things – they see your full-time job as an obstruction or a nuisance that holds you back and can cost them a great amount of money.
Don’t Be Afraid To Quit
Finally, you must not be afraid to venture out of your current job once the profits start flowing in. You can earn only so much while having your attention divided. If your business has proven to be a success, customers keep coming back to you to redeem your offering, you are motivated to grow and branch out, and you are able to sustain yourself and your family with its profits alone, then you have no reason to continue working two jobs at a time.
There will always be potential risks and losses with your business, and you will be the first one to be affected by them. Still, with proper disaster mitigation plans and strategies, you can overcome any boulder thrown your way and succeed as an entrepreneur. Only you can decide when is or when is not the right time to step out of your old shoes and step into the new ones.
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Data science enthusiast, bibliophile, and an obsessive reader. Always down for a conversation on technology and a cup of coffee.