Get Ready to Start Your Solopreneur Business
Do you dream of quitting your job to strike out on your own? Instead of idly dreaming, hoping to be ready "some day," take these actions to prepare yourself for a quick take-off.
Create a Bankroll
Sure, you want to start a business to increase your income. Financial freedom is a powerful motivator and a compelling reward for the risk of starting your own business. If you're lucky, you'll start earning money right away, but the more likely scenario is that your first several months will be up and down, with alternating bursts of strong cash flow and unexpected expenses.
These ups and downs can quickly kill a new business. Protect yourself with a financial cushion big enough to see you through the first 6-12 months (18 is even better).
Three important financial steps to take before quitting your day job include:
- Pay off debts and reduce your monthly obligations. Eliminate small debts and trim discretionary expenses. It's easier to negotiate better rates on things like cable, cell phone and internet fees when you have a steady income, so do this first.
- Stash some cash. Bank the savings from step 1. Then shift some of what you spend on minor expenses like your morning coffee run or daily lunch out into a savings account earmarked for your business. Put this someplace where you won't be tempted to spend it, and your business nest egg will grow surprisingly quickly.
- Secure sources of credit. Business credit can be hard to come by (see "Will a Bank Lend You Money?) and many new business owners finance their first several months with personal credit. Keep business expenses separate by picking a card you will use exclusively for business charges, whether that's a new credit card or one you paid off. If you plan to get personal loans from friends or family, talk to them well in advance to ensure you have a formal agreement in place.
Reconnect with (or Build) Your Network
Just as the best time to find a new job is when you already have one, the best time to shore up your network is when you don't need help. Rather than waiting to approach people hat in hand after you launch, go through your contacts and catch up with people you haven't talked to in a while.
Find out what they're working on. If you feel comfortable, tell them a little about your plans and see what they say. You'll get some great advice and plant seeds for future contacts. In fact many people may say, "Call me when you're ready" and offer introductions or other assistance when you launch.
Also look for gaps in your network. Are you going into a new industry where you need to meet people? Do you need to develop a social media following? Are there competitors you can contact now who probably won't speak to you later?
Use this time to build relationships and do research so you're better prepared when you tackle your business full-time.
Test Your Idea
You can do this as part of your networking, but you'll also want to talk with potential customers and prospects. Does your concept hold water? Are people willing to pay for what you want to sell? Can you make enough to have a viable business?
There are many ways to test your business idea, choose a few and make this effort a priority. Otherwise, you risk quitting your job only to discover that what you expected would be a wonderful opportunity isn't one at all.
Some questions to ask include:
- Is your offering sound? Is it something people want, or are you creating a completely new concept?
- Do you have the right market? Think in terms of industry, location, demographics, etc.
- What's the best price point? Will the pricing model you want to use hold up?
- Who else is out there? Look at competitors and evaluate why they are succeeding or struggling.
- Do you have the resources you need? If not, how can you secure those resourses when you need them?
Beware of Inertia
The largest obstacle facing many prospective solopreneurs is not passion, money or motivation, it's inertia.
In physics, the law of inertia says that an object in motion tends to stay in motion, and an object at rest tents to stay at rest, unless some force acts upon it. Translated to daily life, that means that it's easier to do nothing than to do something. We need a spark to get our momentum going.
Some solopreneurs make the leap after a layoff or change in personal circumstances. Those "forces" create a need for action. Without those triggers, it can be really easy to plan endlessly and never make the leap.
I've experienced this myself, and it took a friend successful consulting colleague of mine to call me on it. I was waffling on something and she finally said, "It sounds like you're still getting ready to get ready."
She was right. I was busying myself with the process of planning, evaluating and thinking things through. At the rate I was going, the project at hand would never take flight.
Sometimes you just need to do something, even if it's not perfect or even close. Simply taking action toward your goal gets the momentum going. Get out of your head. Put the wheels in motion with the steps I outlined above and turn inertia into an advantage.