In this crappy economy, should you start a company or keep your full-time?
Photo by HayesPotter
Is it really that hard to build a startup while working full-time for a corporate firm?
My good friend Jamie asked me this question last night and I had to reflect upon my experiences for a while before I could give him a solid answer. After all, the dream of any entrepreneur is to leave our corporate job to start the company we dream about and make millions. I know from first hand experience.
Here are the pros and cons of each:
Devote yourself full-time to your startup
Pros
- You put yourself in a position where you have to succeed or you will die. This makes you extra motivated and you will work harder than ever
- You can spend 100% of your time on your company without the distractions of another job to do
- You will learn a tremendous amount because you will have to be the President, Secretary, and Janitor of your company
- You have the opportunity to make a lot of money doing what you love
Cons
- You leave your safety net, steady paycheck, and health benefits
- Most of your friends and family do not understand the lifestyle so will not be able to relate to the ups and downs you will experience
- You will be living off of your savings so there is always the pressure of making money fast
- Because you now have a 100% of your time free to do what you want, you can at times get distracted by play and not be as productive as you should be
- It is a HUGE risk and you will most likely fail
Keep your corporate job and work on your startup part-time
Pros
- You get to keep your steady paycheck and health benefits while working on building your startup
- Once you start generating some revenue or build momentum, you can leave your corporate job and jump head first into your startup
Cons
- You will be working a ridiculous amount of hours!
- Investors will not fund a company with a part-time founder
- It will be very difficult to devote the time and energy necessary to build a team, develop a business plan and strategy, and execute on the idea
- You will need to schedule meetings and events with other companies and investors around your corporate job’s schedule
I’ll be very honest with you guys: There is absolutely no way that my company would be where it is today if Yu-kai and I were working part-time on it. There’s just no way would could have made this much progress. So does that mean you should leave your corporate job now and become an entrepreneur?
Not necessarily.
Lesson Learned
My advice to aspiring entrepreneurs in this crappy economy is this:
- Keep your full-time job and start your startup part-time
- Save your money to the point where you can go 1 whole year without generating any revenue
- Use this time to build your personal brand, network with other entrepreneurs, and seek people to join your team
- As soon as you have gathered enough money to survive 1 year without generating revenue, leave your company immediately
I don’t care if you’re super close to a promotion or about to get a raise, follow through on your commitment and go full-time entrepreneur. I strongly believe this will give you the greatest chance at success because you start off your startup career with money, with an established personal brand, and potential team members.
—
What do you think? Is this the best way to start your startup in a recession or do you have a better strategy?
You know, I really admire your resolve and how you stick with your entrepreneurial endeavors even in tough times like these. I remember reading in RP’s profile about how you want to share the less glamorous side of entrepreneurship in your blog and I think you do that in such a way that your readers see how challenging it is — but we can also see that you’re clearly still very passionate about what you do.
I have another friend who’s an entrepreneur, but he would never be as honest as you. He’s constantly trying to make his life appear as glamorous as possible to everyone — he wants his personal brand to be “the fun guy” (literally that is what he told me) — not that there is anything wrong with what he’s doing but he never admits to anyone the challenges he’s facing — he makes it seem like his entrepreneurial life is one glamorous party all the time, even though his company has no money. He gets pretty annoying sometimes…
Anyways this was a longass comment but my point is — seeing the difference between you and my other friend really made me appreciate your authenticity and honesty.
keep it up
Nisha’s last blog post..Strange how a single conversation can change you
Hey Nisha,
Thanks so much for your compliment. You happen to be one of my fav bloggers in the world!
I definitely feel ya on this one. I have a lot of entrepreneur friends who make their lives seem so glamorous. “I’m living a passionate life, unlike those corporate people!” Why so much hate?
We need people to be more real with everyone else. Yea I love what I am doing, but that doesn’t mean that I’m not struggling. I’m trying to demonstrate this to all those would be entrepreneurs.
Anyways, just a heads up. I’m going to start implementing video more and you’re probably going to be one of my first collaborations
- Jun
No two entrepreneurs are the same. ^^
@Yeyen - very true, but then again, it can be argued that no two PEOPLE are the same. Everyone has their own unique path.
But this doesn’t mean that we can’t learn from each other. I read and listen to many more experienced entrepreneurs so that I can learn from their successes and failures. I want to do the same here for my peers and the next generation of aspiring entrepreneurs.
- Jun
Jun Loayza’s last blog post..FDTV Episode 24 - Promote your talents on youtube with Olivia Thai
So very true. So wise for a young guy!
Hey Jun, I started my company 1.5 years ago as well, and my business partner and I both left our jobs.
I strongly agree with you on all the points you made. We would have never learned as much as we did or built our company to where it is today if it we didn’t do it full time. There are always ups and downs, but the lessons we learn are priceless.
For those people who are thinking about starting their own business, with a steady paycheck or job, there are so many lessons you won’t learn and so many moves you won’t make because you’re comfortable in your current job. It really is motivating when you have to build your company or die, you set yourself up to win. And if things don’t work out, it’s not like you can’t go back to a job if you need to, at least you took a shot at it. You have everything to gain because you learn things that you probably won’t ever learn without really being in the arena.
I really believe that working on your own business requires your full focus, energy, and time. But living off of your savings for awhile definitely does help, so I would say that’s a good idea.
Jae’s last blog post..Kinowear Lookbook: #1
Hey Jae,
Congrats on starting your own company and having the courage to leave your corporate job! Putting yourself in the position of succeed or die is probably one of the best things you can do while you’re young.
How is Kino Wear going?
- Jun
Good post!
One interesting dynamic is if one founder is full-time and the other is part-time. In this case it becomes tricky in making everyone feel balanced in terms of shares of the company and such. However, some people are committed enough to say that “A chunk of the money I earn in my corporate job will be used to fund the company and pay for operations and other employees.” When a founder has such a large commitment, then things would work out. Again, the founder’s going to work EXTREMELY hard like Jun said and not live a super comfortable materialistic life, but just enough to not be a burden to others and stress about living. This takes commitment and is the mark of a successful entrepreneur.
Yu-kai Chou’s last blog post..How to actually save the economy with a $787 Billion Stimulus Package
Entrepreneurs never ask when to start. They just start. If you have the passion, you cannot stop. You have to do it.
Peace.
Hi,
It’s truly good blog.. I didn’t had courage to quit my current job. I have some ideas which I think are quite revolutionary, but as you have said, I am blocked with the daily things of my regular life. But, I think I will surely try to start my company soon!!