One study shows that 77% of Americans between 25 and 34 prefer to work for themselves than toil for an employer. And that is understandable. From dealing with a lousy manager, doing a job you dislike, and long hours of commute, employment can feel like slavery instead of a privilege.
Rather than wander from job to job hopping for better terms, you can turn your business idea into a company while still employed full-time.
Interestingly, in 2020 during the pandemic, entrepreneurs started over 4.4 million companies. Some were still working full-time when they invented their businesses. Here is what you can also do to pull it off.
You might also enjoy reading: 7 Exciting Ways to Save Money From Salary.
Tips For Starting a Business While Working Full-Time
Starting a business while working full-time is possible; I started my business while working full-time in the banking industry. If you are planning to start a business while you are still working full-time, I suggest you consider the ideas below and choose what fits your situation.
1- Choose a Great Business Idea (not perfect!)
Many employees who want to venture into entrepreneurship while working full-time spend hours brainstorming and moving from one business idea to another. They are looking for a perfect business idea.
The result? They waste time jumping from one idea to the next and never commit to any. Some employees also start and abandon their projects halfway with nothing to show for all the hard work that went into the projects.
Here is my advice: You do not need a perfect business idea because there is none. A great business idea should cater to your strength, allowing you to match the competition.
What shows that a business idea suits a person working full-time? Consider this checklist:
- Profitability: Entrepreneurs are interested in profits. So ensure your business profits can replace or exceed your current salary within a few months. The business should promise financial stability and cover all the lost employment benefits.
- Enjoyable: Most people want to dive into entrepreneurship because they don’t love their current jobs. Therefore, ensure your business is something you enjoy, like a hobby.
- Leverage your skills: While it is true that entrepreneurship is not easy, you can succeed in it if you leverage your current skills. Your business should solve problems people struggle with, and your skills are assets you can use.
- Scalability: If you want to start a business while still employed full-time, choose a scalable one. Because you are still working full-time, you will need to start small. This way, you can test your business model and products while keeping costs low. However, once you are confident the model and the product works, you can expand the operation and think of quitting or hiring people to manage it.
2- Read And Follow Your Employment Contract
It is essential that you understand and follow your employment contract to avoid adverse legal implications.
What do I mean? Your employment contract could have clauses that affect your ability to start and run a business while still working full-time. These include:
- Non-compete clauses
- Confidentiality clauses
- Exclusivity clauses
For instance, suppose you are working full-time for a web development company. Your employment contract might include a non-compete clause stating you cannot start a similar business.
If you start a web development business while still employed by the company, you could violate this clause and face legal consequences.
Additionally, your employment contract may include a confidentiality clause prohibiting you from using any confidential information you learned while working for the company, such as client lists or trade secrets, in your business. Violating this clause could also result in legal action.
So, check your company’s employee manual to understand ownership of invention and IP. If you can find a manual, consult with the human resource department for an explanation of the policy.
3- Conduct Market Research
Failure to conduct market research is a sure way to failure. You should ensure your business products and services address a specific customer pain point.
Market research and surveys will help you understand your customers, allowing you to tailor your product or service.
When will you conduct this research when working full-time? You can identify dead hours in your routine, like during commute or lunch hour. Design questionnaires for potential customers to learn more about them.
If you cannot find time to do this yourself, you can hire external firms to do the survey online or otherwise. This data will help you make an informed decision.
4- Save Your Business Income As a Safety Net
Setting aside cash reserves from your business profit is part of preparing your finances before quitting your job. This money will help sustain your lifestyle when you leave your employment.
It is like building an emergency fund. The funds should cover at least six month worth of expenses. Otherwise, you may not make ends meet after quitting, and no one wants that frustration.
Before quitting my employment to venture into the blogging business, I saved up to 12 months of expenses. This allowed me to transition to full-time self-employment comfortably.
Why is it important to save or invest your profits? Startups and even established businesses go through lean times. Savings will act as a safety net when you don’t expect a salary from your job.
5- Prioritize Your Time
In the article expectation vs. reality of growing a startup, many people switch to entrepreneur because they think they will enjoy lots of free time.
While entrepreneurship offers you the freedom to control your time, running a part-time business while still keeping your day job does not accord such luxury.
Your job and part-time business require your attention, leaving you with limited time for non-essential activities.
So how do you go about it? Prioritize important things. You only have 16 hours if you remove 8 hours of sleep. Discuss with your family and other stakeholders in your life, then plan your time. Eliminate activities and responsibilities to make time for the business.
6- Consider The Startup Cost
While every business has a chance of failing, starting a side hustle that requires substantial financial investment upfront can fail disastrously and push you to bankruptcy.
So, choose a startup that requires less startup cost. I recommend starting a service business like freelancing or cleaning. This way, if the company fails, you have lost your time and a few supplies you can use at home.
On the hand, investing $70,000 in a small restaurant is a huge risk because if it fails, you have lost the investment.
Other businesses you can start while still working full-time include self-service car washes and Storage units. These businesses do not need your constant attention and are highly profitable.
Exercise caution when a business idea requires the following:
- A storefront with high overhead costs
- Buying, producing, and housing inventories.
- Expensive equipment
- Hiring many employees
If you want to start a business while still employed, ensure you know the risks and the steps to take to protect yourself from financial loss. You could outsource a professional financial opinion before launching the business.
7- Be Open With Your Employer
Your employer is a fellow human, and they will need you to be honest about your business plan. If your business does not compete with your current company, your employer may even partner with you or invest in the startup.
You could also sell your products to your employer.
If you think you can woo your employer as an investor, a customer, or a partner, consult an attorney on how to proceed.
However, you should also know…
The Don’ts when start when starting a business while still working full-time
Consider some things you shouldn’t do when starting your business while working.
Don’t use office computers and email systems to send your business emails
It is unethical to use your employer’s resources to further your business. Even if you didn’t use the company’s email system, sending a business email using your employer’s computers can present a legal challenge later.
If you can afford it, I suggest you buy a computer dedicated to your business to avoid a conflict of interest.
Don’t be in a hurry to leave your day job immediately
Your new business will go through a life cycle (ups and down). Early wins may not necessarily mean your enterprise will succeed.
Therefore, it would be immature to leave your day job immediately and venture into business because you made your first profit.
Remember, validating a business model and enhancing your customer base takes time. Before quitting your day job, ensure your side income is above your necessary expenses.
Don’t be afraid to go full-time entrepreneurship when you are ready
Running a business while still working full-time can be exhausting, especially when the company is picking up. Part-time business can only grow to a certain point. It will require your full-time commitment if you want to develop it further.
What to read next:
- Here’s How to Effectively Manage Changes and Bring Success to Your Business?
- Start Up Coaching And Mentoring: Is it worth it?
- 6 Expectations Vs. The Reality of Growing a Start-up!
- 7 Easy Psychological Pricing Strategy For eCommerce.
The wrap-up
It is possible to start a successful business while still working full-time. With proper planning, dedication, and commitment, you can grow your business while holding employment until you are ready to quit.
In summary, the following things will help you start your business while still employed:
- Choose a suitable company (not a perfect one)
- Read and follow your employment contract
- Conduct market research
- Save your startup income
- Prioritize your time
- Consider the startup costs
- Be open with your employer
What other aspect should an entrepreneur consider when starting a business while still working full-time?