When Should I Quit my Day Job?
Hypothetically, let's say you have this really great idea for a product or app. Your friends and family all share the same opinion that it's going to sell for millions and the sooner you get started developing it, the better. But you're working full time and can only really devote some evenings and your weekends to building it. How do you know when to take the plunge and quit your day job? This question sprang to mind after speaking with four companies, all of which have founders who at one point in their lives were working normal office jobs, but decided to pack it all in and take a risk. Of course, one of the main deterrents for potential entrepreneurs is leaving a stable job, with a regular pay packet each month. This was exactly what the founders of Caserails had, and in large quantities, considering they were (are still) patent lawyers. So why would you decide to go from earning a quarter of a million dollars each year to potentially nothing? An article by Forbes entitled, "5 steps to a successful startup", lists the following as crucial things every startup should have in order to alleviate the risk of it failing and you losing that bet of quitting your day job: 1. Identifying a need in your community. The guys behind Caserails aren't launching a brand new toy for children, or a new tool for construction; they're lawyers, they've been in that field for a while and know exactly what's missing. The risk of their startup failing is immediately reduced by a huge amount, all because they've identified that their field could really use a web app that helps lawyers organise and manage documents. So they're going to make one. Coursehorse is a slightly different story: the founders weren't working in education, instead they found the need through actually being the user, they were looking for a simple solution to finding courses in New York but couldn't find one, so they set out to build one. The second point made in the Forbes article is: 2. Understand your skills and talents. This point probably applies more to Coursehorse as one of the founders had been working as a consultant before leaving and starting Coursehorse. There, he likely developed some key communication, speaking and networking skills which would come in handy for someone whose company relies on persuading small companies to join your website. 3. Drive operational efficiency. Salesbus' idea is simple: let students buy (in bulk) things that they can then sell on to classmates, teachers, whoever. The idea is simple, but the operations and logistics required to run a company like this has to be perfect. Who delivers the goods? Do you deliver? What if you're out of a product? Do you get a discounted rate by purchasing more? What if a delivery is late? The founders admit that it's still early days yet, although they're beginning to create a hub to start shipping out products, the key to their business being successful is how efficiently it runs. 4. The importance of market research. This rang true for the founders of Ontodia, a platform that has gone on to create Pediacities, an open sourced civil planning encyclopaedia for New York city. Before they developed Pediacities there was no other website that provided this amount of aggregated data in one place. They identified that no one had done something like this before and decided to build a solution. The fifth and final point is one that sums up all of the previous points nicely: 5. Don't quit your day job. The guys and girls at Caserails, Coursehorse, Salesbus and Pediacities at one point in their lives had to answer the extremely difficult question of, "when should I quit my day job?". They all did, and in most cases their gamble paid off. However, all of the companies satisfied at least two of the five points made by Forbes in what determines a successful startup. There's no way to know for sure if your startup will become successful, but it's calming to know that there is a way to alleviate at least some of the risk involved in leaving your day job and taking the plunge.