One word sums up leaving the comfort and security of a salary for the many unknowns of self-employment – scary.
And it’s that fear that often keeps would-be entrepreneurs in the nine-to-five grind instead of pursuing a potentially lucrative and fulfilling business idea.
But as Elite Leadership’s Brad Shaw explained to ShortPress, there’s no reason the switch from full-time work to running a start-up should strike fear into your heart.
As long as you avoid a few common mistakes, that is.
For those thinking about taking the leap, Shaw’s first word of wisdom is simple but he says this is often overlooked - cash flow.
“Don’t have a plan B,” the Sydney-based advisor says."
He says one of the biggest mistakes he sees among SMEs and start-ups is starting out with a lack of capital, which ramps up stress right from the get-go.
Shaw advises not leaving your job until you have enough cash to last between three to twelve months, depending on the industry you’re trying to crack.
“You should be able to know exactly how long you can survive on the income that you’ve got,” Shaw adds.
Shaw’s second tip is one likely cause many of those considering self-employment to break into a cold sweat – get rid of your safety net.
“Don’t have a plan B,” the Sydney-based advisor says, referring to those who try to start a business while still working part- or full-time.
"They’re thinking about it 24/7 so you need to be able to do that also.”
He says ditching other income sources is crucial because wholehearted commitment to your goal – so critical for business success - is impossible when you’re still putting in hours at your old job.
“People often say I'm just going to keep working full-time until it actually gets off the ground [but] the successful people are the people who are absolutely passionate about what they’re doing,” Shaw explains
“They’re thinking about it 24/7 so you need to be able to do that also.”
Mental toughness is another non-negotiable, according to the business coach.
He says while many small business people have good technical skills, the success or failure of a venture often comes down to attitude.
“Every successful businessperson has had many times when a quitter would quit but the people who are actually successful are the ones who actually keep pushing forward,” Shaw said.
Another tip for those jumping into the entrepreneur world is to get precise about who their customers are.
“Be very clear on the customer and the problem in the market that you’re solving for that customer,” he says. “You need to do that better than anybody else.”
Sam McKeith is Sydney-based media professional. He has contributed to many leading publications including The Huffington Post, The Australian Financial Review, The Australian and BRW Magazine. He was previously a senior reporter at the Australian Associated Press where he covered national affairs.