Admittedly, running two gigs or what Raffiee and Feng refer to as “hybrid entrepreneurship” can be totally exhausting. The laudable thing to do is to take a leap of faith and jump with both feet into the business of your dreams, burn all the bridges and face it head on. Generally, it is impressive if you can pull off the leap of faith thingy. I did it, and it worked for me. But in my own case, I was in my twenties, and that was a huge advantage. For most people however, that kind of leap will be too risky. In that case, it will be reasonable if you wait, and hold off a bit till you know exactly what you are doing.
Below are six reasons you should:
- You need to double-check your idea
I know you see no reason why you can’t pull it off. But many times, you could just be merely excited. For instance, the fact that your cousin in Wisconsin pulled off something similar can energize you and make you want to jump right in. Maybe he has even told you that it was “no big deal”, and promised to show you the ropes.
I understand, but please tread cautiously.
Until you actually begin running that business you can never really tell how feasible your business is. You can never determine how the market will respond to your products, and how long you will stay before you make your first profit.
So hold off on marching into your boss’ office just yet. Step in with one foot and test the waters first before you resign.
- The millions won’t likely come in the first month
If you depend solely on your new business to pay the bills and to keep the lights on, you will find out what every entrepreneur finds out pretty quickly; that new businesses take quite a while to start paying anything substantial.
Whether it is just for a few months longer it is wiser to hold on to your day job so you do not end up completely broke. It is good to be purpose driven and all, but always try to ensure that money doesn’t finish in your pocket. That was why the founders of airbnb had to run a by-the-side gig to raise money till their business started yielding profit.
- You ain’t meant to deplete your savings
Every new business has its feast days and its famine days. There will also be times spent planning and strategies on how to get over the hump of non-profitability.
A new business is rarely ever a steady or predictable paycheck. Sometimes you may have to reinvest what the business makes into it to establish it.
Holding off on quitting your day job can enable you to go through those days without having to clean out your savings.
- Your day job gives you a cushion against serious frustration
Beyond all the excitement of launching a new startup, there are days where you can get straight up frustrated. There are days when the IRS and different state agencies will come calling, and they won’t mind that you haven’t made a sale in two weeks. Those are the days you will find the existence of your steady paycheck refreshing.
It is best to take a chill pill and only let go of your day job when your business has at least gotten to the level where you can afford to settle all your bills and handle all your financial responsibility. At that time, you will be better poised to make your business grow even further.
- The stats warn against it
A paper appearing in the most recent issue of the Academy of Management Journal finds that entrepreneurs who start off by working part-time on their new ventures– holding on to their day jobs while they launch their new companies– cut their risk of failure by a full third.
The research was carried out by Joseph Raffiee and Jie Feng of the University of Wisconsin, Madison and establishes Hybrid Entrepreneurship as a safe path to establishing a new business. There are a number of other research data that suggest the same.
- You will be in good company
If you’re debating whether or not to quit your day job, perhaps you’ll take heart from the impressive list of entrepreneurs who’ve trod that path.
Steve Wozniak stayed on at Hewlett-Packard after founding Apple with Steve Jobs. Henry Ford founded the Detroit Automobile Company while employed by the Edison Illuminating Company. And even Pierre Omidyar launched eBay while still at another software development company, World-beaters, indeed!
I dare say it is good company that you will find yourself in.