On our last issue we talked about hiring the right individuals for the organization. I have gotten some emails asking for my opinion about the right time to leave the organization and start your own practice, so this is my opinion.
Think about how to start, and about how to end. Do I make any sense? Picture yourself as a young professional or at an early time in your practice. It makes sense if you get off school and immediately start to looking for an internship, a job in your practice, right? Then with some years of experience, and once you have mastered your practice, then you decide to work on a promotion, maybe look forward in to better and bigger challenges and opportunities, maybe a bigger pay check? Whatever is the case. That is usually the case for some individuals. And finely once you have accumulated a decent amount of experience then you decide to open your own company.
Sounds easy and straightforward but is not the only way to become as your own boss. You have the multiple options to reach those points of your life. Maybe time to start a New Direction in your life...
Depending on the type of practice you have, your success or failure depends only on your attitude. I would say never put all your eggs in the same basket, and I tell you why in a minute.
The success or failure of a business depends on multiple factors, not only in the income producing factor, but also in what you do “your attitude factor”.
If you had mastered your practice, it doesn’t mean automatically you will success in your business, you could be a great painter but if you do not have the basic selling skills then your paintings will not sale, and your business will not have a steady income to support itself.
For some it’ll make perfect sense to start a venture when unemployed, with time in their hands and while collecting unemployment. For some it'll be a great way to deal with unemployment.
The approach I would have to suggest is the “multiple diffused risk” and this is just a definition that just came in to my mind. What are you talking about Enrique? Let’s say you are the greatest shoe design maker in the world, and you just had just quit your job at a major shoe designing company, and you have much cash to start your own shoe design company. Let me tell you by just jumping in to it would be a huge risk to take, especially if you do not have the everything else in place yet. All your eggs would be in the same place, keep in mind that lot of things can and may go wrong.
For years I obsessed with Murphy’s Law “what could go wrong, will go wrong”, in my case had helped me a lot with minimizing my risks in life.
Also my former training as a Civil Engineer had helped a lot. Especially when designing something to resist earthquakes, if your area usually gets hit by six degree earthquakes, then design for eight degree earthquakes, be prepared.
It’ll make more sense to diffuse your risk by attempting multiple mini sales, spread your risk. Some would start small designs on their own while still fully employed.
If you do not feel comfortable assuming all the risk, then you might consider getting a BP “business partner “who can assume part of the risk. Sometimes a business partner is a great idea, especially when you lack of the expertise in some areas such: knowledge, marketing, sales, accounting, business in general, etc.
Getting a BP is also a risk. You would have to come to terms with your BP in order to plan everything from whom is in charge of what, responsibilities in a specific area, period of time, money, etc. as you can see that having a BP is a great relief in some areas, it could be a pain in some areas too, especially if you are an individualist person.
It could be a great idea to get multiple BP’s at the same time, but that is something that you would have to decide.
I have all the time peoples asking me about the “paper work”, sole proprietorship, partnerships, LLC, corporation, etc.
My personal opinion is to start easy with a “sole proprietorship”, why? Because the three main reasons: 1-you have the control all the time 2-you decide when and what to do and most importantly 3- because the tax breaks you get when you start your own business.
You can start a business with as little as $470 in any given year; I’ll break it down for you:
- Website built $75/year Website built here
- Website host & domain name less than $75/year Check it out here
- Business cards $95
You can start advertising you goods or services within hours, and depending on your attitude and field of expertise your new clients would start calling for you.
I have some current clients who’s started a business a few years back, they also have gotten websites.
In time, when your income from business becomes steady then it’ll be a good idea to start thinking on creating a LLC, partnership or maybe incorporating you business. I would advise to talk to your tax professional.
And as for the answer of the main question of today article: when it is time to fly solo? The answer is in you. For some the answer is now, for others it’ll never happen because they don’t feel comfortable on taking risks. It is all about the choices.
In the mean time keep it simple, go for it, you have nothing to lose.