Should you quit your job to start a business? This is one of the most common dilemma faced by those who want to start a business. Once they’ve decided they want to be an entrepreneur, they don’t know whether they should just quit their jobs or hang on until the business is on a more solid footing.
In my opinion, it depends on several factors:
1. How is your tolerance for risk? Some people love to take risks and live on the edge, while others are very risk averse. If taking risk is in your nature, you would love the challenges of starting and running your own business, and the ups and downs of entrepreneurship. However, if you are the type who is more prudent in decision making and only makes the move it appears that things will work out fine, then maybe staying in your job while jumpstarting the business is the best course of action to take.
2. What are your resources? If you have adequate capital to start and run a business – and keep it afloat for the next couple of years – then giving up a good job is ok As an employee, you are assured of getting a paycheck every 15 days or so. But as a self employed business owner, it may take months before you make your first sale. Worse, you may not make enough to pay the mortgage or rent and purchase groceries. If you have a family, you also need to consider whether your resources are enough to take care of them.
3. Do you have health insurance? Health insurance is another important consideration. As a self employed individual, getting affordable health insurance for yourself and family is not easy. In fact, health insurance is one of the common reasons would-be entrepreneurs are keeping their jobs before the business makes money. It is expensive to get health insurance, so make sure you can really afford buying one for yourself and your family when you decide to quit your job.
4. What about your family? If your business fail, will you have sufficient resources to feed, clothe and give whatever it is your family needs? If not, then having a job as a fall back position would be best.
5. What are the prospects of the business? Do you think there is a strong chance you will earn money from it – more than what a job could bring? Do you think you have the knowledge, resources, and technical skills to make the business succeed? It’s just a matter of looking at the potential of the business, and deciding whether it is worth leaving the stability of a job and a regular paycheck. If you think your business will earn in two months what you earn in a year as a salaried employee, then chances are great that you’d do better if you quit your job and provide full-time attention to the business.
6. Can you handle the pressures of doing two things at the same time? If you decide to stay in your job while working on jumpstarting your business, this means that you will be doing both at the same time. This may mean that you work on your job from 9-to-5, then come home and stay up late until midnight doing tasks for your business. Or it may mean doing your job during the weekdays, and your business during the weekends — which means gone are the days when your weekends are spent at the mall or hanging out with your buddies. Are you prepared for the long working hours ahead? Are you willing to give up your leisure hours? Can you handle the stress of doing both things? It’s not going to be easy; especially if you have a family.
Some people are meant to be entrepreneurs and do not like to be boxed in by a corporate environment. If you are this type of person, you will find the risks of entrepreneurship to be so worth it.
Remember, you don’t have to quit your job while you are still starting your business. Many people work on their jobs while trying to jumpstart their business, and leave it only when they have proven it to be a moneymaker and they have calculated that they would earn more by spending time on the business than on the job.