Transitioning from employee to entrepreneur is challenging, especially for first-timers. Before you take the leap of faith, ask yourself these four questions to determine if you, and your wallet, have what it takes to be an entrepreneur.
1. Do you have the experience?
Starting a business is like having a baby, you can’t expect it to thrive without nourishing it. Finances, employees, and customer satisfaction are just a few of the many responsibilities you’ll have as the boss. With responsibility comes decision-making, and it's best to test your problem-solving skills on someone else's dime. Management is a great place learn how to navigate challenging decisions — a skill you'll carry with you when you transition from employee to entrepreneur.
2. Do you have the money?
You need capital to start a business. How else do you expect to pay your rent, employees and advertise your product to the public? If this question gives you anxiety, go back to question 1. Having cash or knowing where to find it, is essential for getting your business off the ground.
3. Where is your money coming from?
Mom and Dad can’t support you forever. Bankers can. Bankers make money from lending money, which is why they love to see local business owners succeed, then ask for more cash. Savvy entrepreneurs understand the importance of keeping their business at the top of a banker's mind. A strong relationship with a banker means hefty loans when interest rates are low. If you don’t know why that matters, you're not ready to be an entrepreneur.
4. Should you go all-in?
Starting your own business is not necessarily a do-or-die endeavour. That's why the term, "side hustle" has become popular amongst entrepreneurs. If you’re not willing to devote time to your side hustle, why would your actions change when you transition from employee to entrepreneur? Your business is your baby. You can’t walk away from it when the clock strikes 5:00 PM.
So, are you ready to be an entrepreneur?
It's impossible to seamlessly transition from employee to entrepreneur, but preparing definitely helps. Volunteer with entrepreneurs, spend time at local accelerators, take a small project for free and give yourself a year talking and listening to entrepreneurs before you make your decision. Life as an entrepreneur is a life full of sacrifices. Are you ready?