Calculated risk for aspiring business owners who hold full time positions and/or are full time students doesn’t only involve having enough savings to support ourselves and the family until the business starts to profit. Smart calculated risk involves carefully preparing the business and our surroundings financially and psychologically for the endeavor way before the decision to dive in full time is made.
These are the 3 bridges that bootstrapped (self-funded) entrepreneurs should not burn before quitting their jobs to pursue the business venture full-time.
Full Confidence In Starting The Business
How long did it take you to make the decision to finally start?
I am more than certain that at least a year passed since you started to seriously think about starting a business. I am also more than confident that you read and watched hundreds of articles and videos, took many notes, thought a lot and asked hundreds of questions before you got to the point where you felt ready to take action.
If you haven’t gone through those stages, if you haven’t prepared yourself mentally and if you just woke up one day deciding that you’re going to invest what you’ve saved over the past 2 years of work, know that you’re not ready. You may be influenced by the very few entrepreneurs that built highly successful businesses in a very short period of time. You may be influenced by the 99.9th percentile when you should look at the average.
Did you know that in the U.S. over half a million businesses start every month? did you know that more businesses close than open every month? quitting your job is a serious decision that you’ll have to make and most importantly be prepared for.
Here is how.
Proof In The Potential Of The Business
This is the deal breaking part. This is the part that’s going to give you the green light to confidently quit your job to pursue your venture. And here it is.
Do not even consider quitting your job until your product proves that it can solve a problem. In other words, people are using and paying for it. It’s not until your reach this point of validation and revenue that you can call your idea a business.
The good news, this does not require countless hours of work to reach. Using whatever resources you currently have or can acquire without investing a bunch of money, you can start creating and selling for months until you reach the point where you have the proof that you’re looking for.
What’s the proof? well people buying is one. How much they’re buying is another important variable. The question you should be asking is, is it a side hustle that can make me extra income or is it a business that has the potential to grow to an X amount by this year and on? If you’re selling two products worth 20 dollars a month, you still don’t have the proof. A target goal and benchmark are thus very important. Set your target goal that will guide you towards making the right decision about quitting your job or wait longer.
Family’s Agreement And Support
Running a business is like raising a child. You can do it alone, but you need at least other people’s acceptance and moral support.
Talk about it with your loved ones early on. By early I mean right when you start diving into the knowledge acquisition part that I mentioned above. When they see you go through these stages, the transition will be very easy later on when you feel you’re ready.
Above all and in general, never burn a bridge you know you’ll have to cross one day. So, prepare yourself mentally, earn others’ support and finally, take calculated risks by proving the viability and profitability of your product before cutting a stream of income.