When you know it’s time to quit your day job and launch a startup
(This is a guest post by Bo Fishback.) I get questions about this a lot. It seems that just about everyone wants to "do a startup," and that just about that same number of people (read: everyone) "has an idea." But if that's the case, why isn't everyone working for themselves? Setting aside for the
Founder Friday is a weekly guest post written by a founder who is based in or hails from the Silicon Prairie. Each month, a topic relevant to startups is presented and founders share lessons learned or best practices utilized on that topic. May’s topic is leaving a full-time job to pursue a startup. (Note: This post appears out of schedule due to Big Omaha coverage.)
Leaving your job to pursue a startup.
I get questions about this a lot. It seems that just about everyone wants to “do a startup,” and that just about that same number of people (read: everyone) “has an idea.” But if that’s the case, why isn’t everyone working for themselves?
Setting aside for the moment that the dream and the reality of running a startup are very different things and that many of those “ideas” are likely terrible, there is clearly a significant barrier that prevents millions of people from just walking out on their day job and launching a new company. And while there are veritable armies of entrepreneurial cheerleaders banging a drum and chanting “take-the-leap!” to any aspiring entrepreneurs who will listen, I believe that there are only a handful of situations in which it actually makes sense to walk away from a decent job to launch a startup. Having zero data to back this up and having made no attempt to find any, the following sources are what I believe to be the richest sources of legitimate startups. If you don’t find yourself in one (or more) of these categories then my money would be on you keeping your day job. Startups are hard… don’t jump into one unless you really mean it.
Complete obsession with an idea.
This is the sexy reason to do a startup but most people underestimate just how rare this is. It’s a nice story to tell in hindsight after a company has succeeded (“I just knew there was a better way, I couldn’t stop thinking about it.”) but most people aren’t inclined to be truly “obsessed” with much of anything. Obsession means tunnel vision. It means a narrowing of what you care about in life in order to achieve one clear goal. I don’t have a guess as to whether or not obsession-driven entrepreneurs have an increased chance of success, but these are the folks who almost don’t have a choice… they must start a company, day-job be damned.
I think Bill Gates was obsessed, Steve Jobs probably was too, but those two guys were outliers along a handful of dimensions so let’s not be too quick to compare ourselves to them.
Closer to home, I think Ben Milne might just be obsessed with fixing what’s broken in our financial system – he literally gets angry when he talks about how it works today, it’s hard to get him to talk about anything that isn’t money transfer, and I’m not sure if that ever turns off. Some of that likely derives from the success Dwolla has had up to this point, but for those of us who know Ben, he is a man on a mission… maybe, just maybe, to the point of obsession. And that’s not to say he isn’t one of the nicest and best guys on the planet… he is.
Little or no risk because of a skillset or personal situation.
This might suck to read for people who aren’t in this situation, but it’s a simple fact. If you have a trust fund, if your spouse has a great job, or if you lucked into working at Google or Facebook at the right time then you absolutely have more freedom to take the leap. Increasingly I’d put really young entrepreneurs into this bucket as well, when there is no day job to walk away from, a startup is a much less scary proposition… doubly so if you’re a developer or a designer and working in software – finding a job in today’s market for those skills is as easy as it’s ever been and because of that, the risk of giving your own startup a go is just not that great.
There’s nothing wrong with this class of entrepreneurs and some of the best companies of the last 50 years have come from it, but the barrier to actually taking the leap is certainly lower. This isn’t nearly as sexy as being obsessed and I actually think a lot of founders in this position are a little shy to admit it because it sounds hollow to say “I started a company because I could,” but I think it’s great that people who could have done something much easier chose the entrepreneurial path. It doesn’t mean this group wants to succeed any less, or that it’s any easier to actually build a successful company, it just means that it might be a little easier to get started on the path.
A nearly risk-less opportunity driven by a unique market situation and great timing.
I know I know… no startups are risk-less, but there are absolutely opportunities that emerge and propel certain people into taking the leap in a very risk-mitigated fashion. People who understand regulated industries extremely well sometimes find themselves in this position when there are big changes to their industry. Sometimes entrepreneurs from this group are also born when new platforms launch entirely new ecosystems of opportunity – and they happen to be sitting on the front lines. I’d also put founders of spin-offs that are born with funding in this bucket. These entrepreneurs are found in all kinds of industries, from energy, to airlines to the web… but it’s hard to intentionally find your way into this situation unless you have a much better crystal ball than I do. These are the founders who find themselves in the right place at the right time and are smart enough to do something about it.
Side projects turn into companies.
I don’t have any great examples of massive companies that were built in this mold (but again, I didn’t really look very hard), but lots of small and medium sized companies get launched this way. It’s one of the best ways to mitigate risk if there is something you love to do, but aren’t sure you could make a living doing it. What better way than to start getting paid for it to prove the market? And why not do this while keeping your day job? Not every field lends itself well to this strategy, but when it does it makes taking the leap that much easier.
You are literally unemployable.
This is not a good category to be in, but it happens, and sometimes (but I can only imagine rarely) it works out. A lot of entrepreneurs joke that they were unemployable at the time of launching their company but the best ones that I know, and the ones I respect the most, could have had their choice of careers. They are smart, motivated, capable leaders, and have chosen to use those skills to build something unique to them. However, there is a subset of entrepreneurs who just honestly could not handle working for someone else. They can’t execute someone else’s plan (and they don’t want to), or they are legitimately convinced that they are the only one who has any idea what’s going on. These are usually my least favorite entrepreneurs to hang out with, but sometimes they build very successful companies.
My least favorite excuse for not taking the leap.
“If I just had $500,000 then I’d start a company.” Uhhh, no shit. You and everyone else.
It’s hard to walk away from the security, the paycheck, the health benefits, and the certainty of a real day job in return for something that might possibly, maybe, someday, if things go really great, be worth something and give you a newfound control over your own destiny. In fact, I’d say it’s stupid unless you just can’t imagine doing anything else or you’re in a position to take a risk. So either find something that you can’t stop thinking about or figure out how to eliminate some of the scariest risks of failure – in a perfect world you’d have both.
I’ve always believed that the best entrepreneurs were either the best risk mitigators or had the least to lose. If you’re not in one of those camps, get back to work.
Credits: Photo courtesy of Bo Fishback
About the author: Bo Fishback, a resident of Kansas City, Mo., is the founder and CEO of Zaarly, a San Francisco-based startup. Fishback was previously the vice president of entrepreneurship for the Ewing Marion Kauffman Foundation and the president of Kauffman Labs for Enterprise Creation, both in Kansas City, Mo.
Fishback is a founder of Orbis Biosciences, a drug delivery and particle fabrication company, and a co-founder of Lightspeed Genomics, a next-generation genome sequencing company that was acquired by Macrogen. Beyond these ventures, he has worked with a variety of life sciences and high-tech startup companies as an advisor, board member, and angel investor. Currently, he is on the board of directors for Orbis Biosciences and is an advisor for Plotwatt, Inc.
Full bio at bofishback.com
Fishback can be found on Twitter, @bowman.
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