MANY would-be entrepreneurs are locked into the corporate grind, climbing the ladder, addicted to the check, waiting on that big win to set them free so they can finally tap into their true passion: building something.
It’s easy to see how it happens. From a very young age, we are conditioned for this behavior. First grade becomes second, junior varsity becomes varsity, manager becomes director.
Some are able to avoid it. Early in their career they break free, start their business(es) and build their life around that lifestyle. Most others are like me. We get swept up into the grind, start working, start making money and get addicted. Income drives expenses, more income drives more expenses and before we know it, we’re beyond the place where making the leap into the unknown of entrepreneurship is feasible. That was me for the better part of a decade.
Here’s the good news. There are ways to break yourself free. It takes discipline and the willingness to take one of the biggest risks of your life, but it can be done. I have just recently made the leap, and it’s an incredible freeing feeling.
The long-term verdict is still out on what this direction leads to, but for an entrepreneur it’s more about the building than it is about the end result. There were four things that I focused on that became the lynchpin to my ability to set out on an entirely new path.
Don’t go it alone
Being an entrepreneur is hard. It will challenge you every step of the way, and on the heels of one of the best days it will almost certainly deliver one of the worst.
In all my entrepreneurial adventures, I have found that having a partner by my side who offsets my personality and skill sets has been a critical factor in the successful creation of something new and long lasting. Find someone close to you with a similar passion who is willing to join you on the adventure ahead.
I am fortunate to have Heather Stokes at my side at 4AM Demand. She is someone who brings out the very best in me and excels in areas that I do not. What makes a partnership like this work is twofold: a shared passion for what’s being built and an absolute trust in each other.
Control your P&L
Much like we do in business, managing profit and loss is critical to survival. Making the leap a little later in life meant that I had debt, bills and living expenses (amazing how expensive two kids are) that needed to be organized so that I could take this risk and not put my family at risk. With that in mind, I built a personal P&L and had long conversations with the family about what was a must have and what was a nice to have. We realized we could live on a considerably scaled-back budget.
With those things in order, taking the risk along with a sizeable pay cut became much less daunting. We put ourselves in a position where we were confident that we could survive while launching 4AM Demand.
With a sound business plan, open up to taking on early friends and family investors to give yourself some breathing room
Day 1 of launching a new company is the scariest. No customers, no cash flow, all sorts of unknowns and a never ending list of “to do’s.” If you plan ahead and build a sound business plan, you may be able to alleviate some of the pressures that come in the infancy stage by raising just enough capital to give you some room to breathe.
If you believe wholeheartedly in what you are building, that passion is going to inspire other people. If you can inspire the right people, they may be willing to trade their cash for equity and make a measured bet on you.
Let’s say you have an incredible idea for a new app that you think could be worth millions of dollars some day. You recognize that right now it’s still in the idea stage with a solid business plan and in early development, so its value is small. You could open up to some investment and sell 1% of the company for $10,000 to 10 people. When all were committed, you’d have $100,000 in operating cash to fund the business.
It takes some planning, legal guidance and selling on your part, but you may alleviate some early cash concerns while also getting some friendly advisers invested in your success.
Use your network
One of the more humbling aspects of launching a new business is that people will emerge from your network and become instant supporters. We have been amazed at 4AM Demand at the number of people to whom we hadn’t spoken to in quite some time who came forward and offered a referral, a lending hand or even opened their checkbook because they believed in what we were building.
Regardless of how long you have been in business, you have a network of people, some of whom are rooting for you. Don’t be afraid to connect with them and tell them what you are working on. With few degrees of separation between you and prospective business, you will be amazed at the impact.