After reading my article, How to Start a New Business Before You Quit Your Job, a reader asks:
Q: Terry, Going into management and learning leadership skills (self-develop and mentored) are great tools no doubt. These can be vital once your new biz is off the ground. Can you explain how to fill the void between start-up to when you have your first employee(s)? Also examples of when the right time to “pull the plug” on your job without burning bridges? TIA
A: Good questions and they require a complex response. Every situation is different, so here are some broad answers.
By filling the “void” I assume you mean how to get work done. Starting and operating a business is the most difficult undertaking of anyone’s career choices. It’s not easy.
The void is filled by working long hours with full support – if there’s a family situation – and outsourcing where necessary.
That’s also assuming there’s enough cash flow for freelance help and the ability to sustain it – with the preparation of sound financial statements and knowing what drives profits.
Unpaid interns can be useful, in general, as long as they’re not used to create business profit and the work experience clearly benefits and complements their education.
It’s important to be a good entrepreneur, and also avoid the wrath of regulators. (See Unpaid Interns: Safeguards to Avoid Legal Issues.) Candidly, in my experience as a consultant, interns require too much direction and time.)
Knowing when to hire
Expanding entrepreneurs should have an awareness of where the talented employees are. Before hiring, there must be a need but an adequate cash flow.
That means a full command of budgeting basics, maximizing prices for goods and services, knowing the break-even point and profit margins to cover all costs associated with employees.
When to resign your job before launching your business
The time to resign is when a person has all the underpinnings for success, which includes an action plan. It’s best to have a business plan.
But a business plan requires a lot of numbers-crunching and you’d have to hire someone to do it. To save money, a vision plan can work.
I can’t emphasize cash flow enough – to have adequate income from marketing and customer retention — and minimizing costs.
Incidentally, no employer is thrilled to lose a valued employee who’s destined to become a competitor.
But whatever the situation, a person can’t be too concerned about resigning. “People-pleasers” don’t make it as entrepreneurs. In any event, I’d give adequate notice and take precautions to keep the relationship on a friendly basis for possible networking in the future.
Good luck!.
From the Coach’s Corner, more resource links:
Successfully Launch a Business Startup in 6 Steps – Entrepreneurs launch their small business with big ideas. Certainly, the business and the owner are synonymous – everything is based on the person’s personality. At the minimum, there are six key questions to ask yourself before you start.
Why Startups Fail – Biz Coach Strategies on How to Win –It’s vital to conduct a thorough needs-assessment of strengths, weaknesses, opportunities and threats – followed by development and implementation of a strategic action plan. Here’s more.
Checklist — 11 Tips to Increase Your Startup’s Cash Flow – Cash flow is the salient dynamic that leads to the failure or success of a business. Here are 11 Biz Coach ways to maintain positive cash flow.
Tips for Moms Who Want to be Entrepreneurs from Home — So, you have a job and would like to fire your boss to work at home. Let me caution you. Starting a business at home might be the biggest challenge of your life. Starting a home-based business has risks. It can sap your energy and time.
You Have a Great Business Idea, but You’re Stuck in 1st Gear? — New entrepreneurs often have great ideas but many hit self-created stumbling blocks. Here’s how to avoid the pitfalls.
“Always deliver more than expected.”
–Larry Page
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