10 Questions to Ask Before Quitting Your Day Job to Run Your Own Company
The dream of being one's own boss is what leads many people to start businesses, but leaving your bread-and-butter job to fulfill that vision is a move that shouldn't be made hastily.
In his book, Quitter: Closing the Gap Between Your Day Job & Your Dream Job (Lampo Press, 2011), Nashville-based author Jon Acuff says that between 70 and 80 percent of people think about quitting their job to do something more fulfilling. “A lot of people wake up Monday morning and say, 'How did I get here?'” he says. “You take a six-month stop-gap job sometimes and find yourself still there years later, but it doesn't have to be that way.”
That said, Acuff and other experts say there are some important things to consider before quitting your day job to start a business.
Here are the ten questions you should ask yourself.
1. Is this going to make me happier?
Before leaving your job for uncharted territory, make sure this is really what you want – not just what you think you want or a way to escape your current job. “I personally believe you should get enjoyment out of your career,” says Chris Hurn, Orlando, Fla.-based, author of The Entrepreneur's Secret to Creating Wealth: How The Smartest Business Owners Build Their Fortunes (Advantage, 2012). “Too many people suffer silently in their job, but before you go out to be your own boss, you have to believe you're going to be happier. If you can't say that you believe it will make you happier, don't do it.”
2. Is the timing right?
If your wife is pregnant or you've just taken over the care of an elderly parent, it may not be the right time to leave the security of an established job to pursue the dream. “We throw out these Pinterest-sized platitudes like, 'Just go for it' or, 'Step out in faith.' And then we pretend that we don't have a mortgage or bills or responsibilities,” Acuff says. Instead, be honest about your current situation; be realistic about your bills and your commitments; and then make an informed decision.
3. How will I cover my expenses?
The biggest detriment to starting a business? Being undercapitalized, says Deborah Shane of Fort Myers, Fla., author of Career Transition – Make the Shift: Your Five Steps to Successful Career Reinvention (Deborah Shane, 2010). You should have a rainy day fund or savings built up to cover you and the business for a certain period of time, the length of which will be determined by the nature of the business and how quickly you'll be able to pay yourself a salary (although Shane suggests 12 months as a good place to start). “Make sure you have the money to pay both your personal and business expenses for that period before venturing out on your own,” she says.
4. Do I have the support of family and close friends?
The talents and shortcomings we have the hardest time recognizing are often our own. So before venturing away from a secure situation, Acuff suggests asking the people you trust the most how well-suited they think you are to the opportunity. “Talking to family and close friends will help you realize if you’re going after something that you really want to do, or just escaping your current situation,” he says. “Don’t just talk to the dreamers in the group that will tell you to go for it. Talk to the people that will be honest with you and encourage you if you’re on the right path.”
5. How much am I willing to change my lifestyle?
Some people are very good at structure. Getting up, going to work for a set number of hours, performing set tasks, and interacting with co-workers works really well for them. Yet starting your own business can be anything but structured and can mean long, hard hours – very often spent alone. “There's also a lot of self-motivation involved. You have to be structured, innovative, creative and proactive,” Shane says. “The solo nature of it is not for everyone.”
6. Do I truly have the discipline to be my own boss?
Many people think if they can be their own boss, it's going to make life easier. Sometimes that's true, but not always, according to Hurn. Not everyone is meant to be a business owner. Although entrepreneurs come in all shapes and sizes, they do often share traits like good leadership skills and a desire to be in control. “Many people think entrepreneurship is for risk-takers, and that's not necessarily the case,” he says. “I think successful entrepreneurs do the due diligence before starting their business and minimize the risk involved in a new project.”
7. Can I test the waters without giving up my current job?
Acuff urges people to 'beta test' their dream job before leaving a stable situation to pursue it full-time. You might find you don't like the new career as much as you thought you would. “Before you quit your accounting job to open a coffee shop, it might be good to work at a Starbucks part-time for six months to see if you hate coffee and humans,” he says. “Practice the dream.”
8. Are there skills I still need to brush up on?
Before stepping out, make sure you have the relevant skills, qualities and intangibles to make a new business work. It's important to be up to date on the latest technology in your field and be able to use social media to your advantage. “Make sure your skill gaps are closed and that you're up on trends and best practices in the area you are getting into, following the top blogs and web sites,” Shane says. “So much is changing so fast -- staying relevant is crucial to success.”
9. Am I sure my business idea is sound?
It's important to make sure what you're planning to do is marketable, that it fills a niche. Is there a need for this thing you want to do? “I work with a lot of creative people who have started businesses based on peoples' lifestyles, the world we live in today,” Shane says. “They've found niches to help working moms, families, individuals who are time-starved.” Make sure your idea is relevant before making that leap.
10. Do I have a business plan?
It doesn't have to be the length of a novel, but anyone starting a new business should put together a plan that includes a sound sales and marketing plan. Winging it is not an option in today’s competitive marketplace. “It doesn't have to be complicated, but can be as simple as a one-page summary,” Shane says. “Look at it as a road map.”