If you’re like many Americans, you dream about starting a business and being your own boss. We’re a nation of entrepreneurs whose legendary can-do spirit built businesses, nonprofits, schools, and houses of worship that have created jobs and services for hundreds of millions of people.
The best part of dreaming about entrepreneurship is that your vision really can become reality. More people than ever are becoming entrepreneurs. The U.S. is home to 28.8 million small businesses, accounting for 99.7% of all American enterprises, according to the Small Business Administration.
Mix a little ingenuity with a lot of hustle, and you can start your own company whenever you want. Unfortunately, many new business owners fall for the false narrative of having to “go all in” on their idea. But going all in financially (exhausting personal savings) and professionally (quitting your job) on your new business is far more likely to result in failure than success.
In fact, there are a lot of myths about entrepreneurship that keep people from launching their ideas, starting their businesses, and ultimately achieving their dream. We’d like to debunk some of those myths, and show you how to enter the ranks of entrepreneurship in a way that’s likely to lead to your success.
Quitting Your Day Job Doesn’t Improve Your Hustle
The internet is packed with articles by and about entrepreneurs who claim their quit their jobs, lived on Ramen noodles, and hustled 100-plus hours a week for two years before finally achieving their breakthrough success. Most of these stories are more myth than reality.
For the majority of people, the entrepreneurial life isn’t about high-stakes gambles and health-crushing workweeks. In fact, the whole image of the modern entrepreneur tends to get a little skewed in the popular imagination. It’s a lot more hard work and stick-to-it-iveness than it is “hustle” anyway.
“The entrepreneurs I know who’ve succeeded,” says INC contributor Dustin McKissen, founder of his own PR agency, “usually took a skill they learned or knowledge they gained during their career and applied it to a problem they had experience with, with the full understanding that success requires paying customers.” Most succcessful entrepreneurs defy the hip stereotype. These people are usually in their mid 40s. They launch their ideas with years of experience behind them. They work with trusted mentors in their industries, and they know how to handle setbacks and failures.
Isn’t hustling a key component to entrepreneurial success, though? Of course it is, but so are wisdom, experience, and access to a decent network of people who possess both the desire and the ability to purchase your product or service. Those factors matter more than hustle in the beginning.
In fact, at the genesis of your new business, you probably won’t need to put 40 hours most weeks to get the job done. Remember the old fable about the tortoise and the hare? It’s moral was that slow and steady still wins the race. That’s a good moral for entrepreneurs to adopt.
Many new business owners see quitting their jobs as a prerequisite to launching their businesses, but often that just isn’t so. It’s better to view leaving your full time job as a milestone to achieve on the journey, not the origination point.
Patience Is A Valuable Business Asset
Most new businesses take 12-24 months to achieve initial traction. Do you have enough money in savings for you and your family to survive for 12-24 months without income? If the answer is no, don’t quit your job. And by the way, when we say “money in savings,” we don’t mean “equity in your house” or “investments in your retirement fund.” We mean money you could take out of the bank without occuring penalties to pay your mortgage, light bill, student loan, or grocery store checkout clerk. If your financial plan relies on cashing in investments, selling your home, pawning a family heirloom, or winning the lottery, your plan needs rethinking.
No matter how much you want it to be otherwise, a new business is rarely ever a full time job at the beginning. In fact, you can easily swing both a full time job and your business for the first 12–24 months. Sure it might mean working into the red-eye hours some weeks, but that’s the life of an entrepreneur. In general, though, you won’t have to put in excruciating labor all by yourself.
For many responsibilities, you can get a spouse, partner, or children to pitch in. For others, you can hire good quality freelancers who will complete timely, excellent work, freeing you up to do what only you can do.
Turn To Various Sources Of Help If Needed
A virtual assistant can be a lifesaver, too, especially early on when you need to focus on the rudiments of sales, marketing, and product development. Many people in the Philippines and other middle-income countries where English is widely spoken are setting up online businesses as virtual assistants. Often these folks charge reasonable fees and do top-notch work, alleviating a lot of headache for a new business owner. You can find a trusted assistant by reaching out to your personal network, asking for recommendations on LinkedIn, or using a platform such as Fiverr or Upwork.
The most valuable source of help, however, comes from a committed co-founder. According to Small Business Trends, “Having two founders, rather than one, significantly increases your odds of success as you’ll: raise 30 percent more money, have almost 3X the user growth, and are 19 percent less likely to scale prematurely.”
Going into business with someone else can be a great way to halve your expenses and double the hands-on work. Like the old proverb says, “Two are better than one, because they have a good return for their labor.”
Let Your Current Employer Fund Your New Initiative
How will you fund your new business?
If your plan relies on angel investors or venture capital fundraising (VC), you might want to create a fall-back option. Only about three in ten entrepreneurs rely on VC funding to fuel their enterprises. Most new business owners just pay out of their own pockets, and some also take out a small business loan from the bank. A few get support from family and friends. Unless your idea is truly groundbreaking, you’re unlikely to attract an angel investor, and you may not even want to, anyway, since they come with a lot of requirements.
“To go this route,” says Lyron Bentovim, CEO and President of The Glimpse Group, “startups must partake in a tedious and long process that doesn’t guarantee success. And at the end of the process, most startups are still rejected by VC investors.” Bentovim recommends seeking creative alternatives such as peer-to-peer lending, microloans, incubators, and purchase-order financing.
You could also request a small business loan from a private lender with help from the U.S. Small Business Administration. All these options contain potential drawbacks and benefits.
Usually, the best advice, however, is to stop trying to find investors for your business and fund it yourself with your own income. This strategy may mean going really lean with personal expenses, but the easiest way to fund your capitalize your business is to do it yourself. Best of all? You don’t have to part with any equity or take on risky debt to do it.
Give Yourself The Runway You Need To Succeed
Most new businesses fail because the owners run out of time. They don’t have the financial resources to hang in there while the business grows organically. As a consequence, entrepreneurs can scale up too early. As you think about scaling up, remember that not every business is poised for a billion dollar exit.
If you’re launching a pizza parlor, ice cream shop, or dry cleaners, your venture will scale up a lot differently than if you are trying to start a global tech company. Also, service businesses scale on a different time frame from product-centered ones. In general, however, all businesses need sufficient runway to pick up speed before you try to take your idea to the skies.
“Before you even worry about scaling your startup, make sure your fundamentals are fool proof,” says Neil Patel, co-founder of Crazy Egg, in an article for INC. “According to the StartupGenom’s survey of 3200+ startups, 74% of failures can be explained by premature scaling.” So make sure you’ve done the marketing work, secured the funding, identified your ideal client, and ascertained your product’s alignment with your consumer’s needs in advance.
Don’t Rush The Timing
Quitting your job too early speeds up the timeline for how quickly your business must become successful before you are forced to make a do-or-die decision about your company’s future. If you can get all the rudiments of a solid business in place while you still have a steady income stream from your employer, you’ll put yourself leagues ahead of the competition and start your firm off on firm footing.
Of course, some jobs don’t make it easy to start a side hustle. What if your day job too stressful to also create a business? Consider finding a less stressful job or even a job that allows you to work at night so you have your days free to start a business.
What if you just can’t stand to spend one more day working for your psycho boss? Plenty of people have done worse to put food on their family’s table. What if you get fired? You’ll want to have as much in place as possible before that happens.
Know When To Turn Your Side Hustle Into Your Main Gig
All that said, there will come a day that your side hustle becomes your primary work if that’s your goal and you work hard toward meeting it. It’s an exciting day, and one you should celebrate!
When is it time to turn your gig into your main source of income?
But Jim, Neil, Dustin, and other successful entrepreneurs can only give advice based on what they’ve learned in the trenches. The person you need to ask is looking back at you in the mirror every morning. Ask her or him if it’s time to turn your side hustle into your main gig. Don’t answer based on emotion. Answer based on the truth.
You’ll know when it’s time. And when it is–and not before–go for it. You’ll be all set to succeed.
Check out all of the articles in the ‘How to Survive the First Year of Your Business’ series:
- Why You Shouldn’t Quit Your Job When Starting a Business
- Don’t Have a Partner? You May Want to Hire a Co-Founder
- You Probably Won’t Make a Profit Your First Year and That’s Ok
- Why You Need to Hire Your First Employee as Soon as Possible
- Finding Investors in the First Year Can Be a Waste of Time
- Building a Business Is a 7-10 Year Journey