When should you quit your job to start a business?
When you are in a comfortable corporate job, chances are, you feel ahead of your peers in the social game of finding a job, getting a mortgage, and settling down. However, for a lot of us, this is not the game we want to play.
With the digitization of the world, more and more people across the globe, aspire to leave their jobs and start with their own business. People are toying around a lot with the word ‘Entrepreneur’ these days. It is being seen as a means to achieve an all-new high in terms of professional, personal, financial as well as creative freedom.
The possibility of being able to do what your heart supports, on your own timing and terms, coupled with the potential to build an enormous amount of income and fame is certainly attractive.
However, it is not wise to just impulsively abandon your job to pursue your dream to start a business. This is considered to be unnecessary and reckless by most successful entrepreneurs. If you are thinking of whether to quit your job or not to start your own business, take the assessment and find out what you should do.
What Do The Statistics Say
As per Bloomberg, 8 out of 10 businessmen who venture into a new business, fail within a time span of only 18 months, leading to an 80% loss in cash. Every year, entrepreneurs launch millions of startups, all over the world. What needs to be noted, is that only one-tenth of these new ventures prove to be successful in the long run.
The above data may appear to be scary and demotivating at the first glance. But you would be surprised to know that 3 out of every 5 Americans dream of having their own business. The same study also exhibits that approximately 37% of these genuinely aspire to be their own boss and another 25% may possibly seriously consider it at some point in time. This trend holds good all over the world too.
Why Do People Look To Shifting To Business From Jobs
Entrepreneurs give out several reasons when it comes to why one takes the leap of moving from a job to starting a business. Making more money which would ultimately lead to a better lifestyle tops the list of these. The freedom to be able to be the navigator of your own destiny and the freedom to work flexibly are also some of the primary reasons that motivate people to take such a major career and life decision.
An extended sense of work satisfaction, financial independence, and the probability of an improved work/life balance also allure people to make this shift.
Traits That You Need To Have For This Shift
People aspiring to move from jobs to business have a higher chance to succeed if hard work is one of their major character traits.
The ability to take risks is also an elementary trait for handling this life-changing decision.
Self-confidence, intelligence, and clarity in vision are the other key ingredients for the recipe of success for an entrepreneur.
You need to have faith in yourself and patience to deal with the uncertainty that comes with trying something new to deal with the initial hurdles of starting a business.
Your Checklist To See If You’re Ready To Quit Your Job To Start A Business
Once you’re sure that you have what it takes to be a successful entrepreneur, you need to take a crucial decision if it is the right time to quit your job and plunge into business. Even though you may have an amazing business idea and all the excitement needed to jump into the scene, it is not advisable to recklessly resign from your job without being completely prepared for the consequences.
There are certain points that you should cross-check before actually putting in your papers at your job. Let’s have a look at these.
1. Research
It doesn’t make sense to invest in a building or warehouse, or setting up an office until you’ve done enough research. You have to know the ins and outs of your product or service that you are going to offer and know that it’s sellable. It helps to do background research on certain criteria like having apt knowledge about the product or service, researching the competitors, knowing your buyers and prospective buyers, building the right team and developing the most profitable sales channels, etc.
2. Laying out a business plan
Creating a business plan on paper after you’ve done your research proves to be a key success driver. A good business plan will have an overview, an executive summary, the company description, objectives and vision and mission statement, the marketing, operational and financial plan, the strategy to enter the market, your working team, and information about the industry and market you would be operating in. You can use this business plan to present before your business partners, investors, and stakeholders.
3. Funding
It is important to check on your individual finances before you look for funding for your business. If you quit your job without having enough funds to pay for rent, salaries, inventory, and other bills, you may find yourself in a stressful position. It would also make it tough for you to focus on other, crucial aspects of your business. If you don’t have enough finances to keep yourself stable till you start making a profit on your business, most probably your business will stagnate due to a lack of funds.
4. Leverage resources
If you can’t spend your money on your business, it is advisable to look for resources outside before you actually start the business. There is a higher possibility of you being able to find resources while you’re still connected in the industry and with colleagues and peers at the job.
5. Leave your job on a good note
Leaving your job without completing your final assignments, serving your notice period, gossiping around, or without training your replacement can prove to be the worst decision you make when quitting your job for the business. Your old company and the contacts from there can come in handy when you go for your startup.
6. Smaller planning details
Once you take care of the bigger picture, it is equally important to focus on the smaller details like selecting the right social media channels, keeping updated with emails, filing taxes on time, etc.
Undoubtedly, it is the hardest decision if you should quit your job to start a business and when. Should you take the plunge and go all-in? Or should you do it at a slower pace and make a gradual shift? Quitting your job when you are not prepared to be fully immersed in your business solely will lead to higher chances of failure in your dream venture.
On the other hand, not quitting at the right time and cutting the cord when it is required will keep you embroiled in the never-ending 9 to 5 loop and would never let you pursue your entrepreneurial dreams full-time. If you delay it too much, you may end up looking into several excuses, pushing it back, and being in fear of making the shift. You know you are ready to make your entrepreneurial dream a full-time work when:
- You are prepared to scale: Juggling between a full-time job and having a startup is wonderful, but it is almost impossible to make your business a money-making venture and make it sustainable and let it grow to its full potential until you make your startup a full-time thing. If you feel your business is ready to scale up but you lack the time for it, it is a good time to quit your job.
- Savings: If you have enough money to keep you going till your startup takes off and provides you with a sustainable income, it is a huge motivator to make the shift and dedicate to your business wholeheartedly.
- Commitment to your vision: The first thing you need to know that you are ready to make a shift is your staunch commitment to your own vision. It may take you longer than expected to achieve the desired success and the road to it may not be as smooth as you took it to be. Your faith in your vision will help you get past these hurdles and help you constantly learn and adjust.
- When you know it’s time: It may never seem to be the right time to take the plunge. There’s always something more that should ideally be taken care of before you venture into it wholly. But the concept of everything falling into place is not a reality, Instead, you have to feel comfortable within you to take the step.
Hang on a little longer in that job and quit when you are prepared with all the skills, resources, and vision to transform your dream into reality!
Frequently Asked Questions (FAQ) – Quitting Your Job to Start a Business
1. Why do people consider leaving their comfortable corporate jobs to start their own business? Many individuals aspire to start their own business because it offers the potential for higher income, greater personal and professional freedom, and the opportunity to pursue their passions. They may desire to be their own boss, have more flexibility in their work schedule, and achieve a better work-life balance. The allure of increased job satisfaction, financial independence, and creative freedom are often driving factors.
2. What do the statistics say about the success rate of new businesses? According to Bloomberg, approximately 8 out of 10 entrepreneurs who start a new business fail within just 18 months, resulting in an 80% loss in cash. Only about one-tenth of startups launched each year prove to be successful in the long run. While these numbers may appear discouraging, it’s worth noting that a significant portion of the population (3 out of 5 Americans, for example) still dreams of having their own business, indicating the enduring appeal of entrepreneurship.
3. What are the traits needed to succeed as an entrepreneur? Successful entrepreneurs often possess certain key traits that contribute to their success. These include a strong work ethic, the ability to take calculated risks, self-confidence, intelligence, and a clear vision. Entrepreneurs must believe in themselves, have patience to navigate uncertainty, and be willing to work hard to overcome the initial challenges of starting a business.
4. Should I quit my job to start a business? Deciding whether to quit your job to start a business requires careful consideration. It is generally advised not to impulsively abandon your job without adequate preparation. Before resigning, you should conduct thorough research about your product or service, understand the market and competition, build a strong team, and develop profitable sales channels. Additionally, ensure you have sufficient funds to support yourself and the business during the initial stages. Leaving your job on good terms and attending to smaller planning details, such as social media presence and tax obligations, is also important. Ultimately, the decision to quit should be based on being well-prepared and ready to fully commit to your entrepreneurial venture.
5. When is the right time to quit my job and start a business? Determining the right time to quit your job and fully dedicate yourself to your business can be challenging. Some key factors to consider include:
- Preparedness to scale: If your business is ready to grow but lacks the time and attention it needs due to your job, quitting can be a good choice.
- Financial readiness: Sufficient savings or alternate funding sources can provide stability until your business becomes profitable.
- Commitment to your vision: Your unwavering commitment to your business idea, coupled with the willingness to learn and adapt, is crucial for success.
- Instinctual readiness: There may never be a perfect time, but when you feel comfortable within yourself and ready to take the leap, it could be the right moment to quit your job.
6. What are the potential consequences of quitting a job without adequate preparation? Quitting your job without proper preparation can lead to increased chances of failure. Insufficient research, lack of financial stability, and incomplete planning may impede the growth and sustainability of your business. It is essential to ensure you have the necessary skills, resources, and a clear vision before quitting your job to pursue your entrepreneurial dream.
If you like our posts, do check out our other startup and business-related posts:
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- How to suck less at handling conflict as a CEO?
- How to get rid of burnout, exhaustion & depression as an entrepreneur and build your dream business?
- Who is a startupper and how to be one?
- Business networking for entrepreneurs
- How to get started with sales as a founder when you’ve never done it before?
