16
When Is It Time to Leave?
Wouldn’t it be great if you could gather the passion and resolve from Tom Cruise’s character in Jerry Maguire, grab Flipper the goldfish in a plastic bag and ask, “Who is coming with me?”
If you haven’t seen the movie, you missed an impassioned speech from a disgruntled employee, steeped in principles of decency and decrying the greed and heartlessness of the corporate world.
Poor Jerry. Or is it poor Tom and Jerry?
The character demonstrates a common mistake made by corporate employees: You wait too long. You lose your mind. And you do stupid things.
It works in Hollywood, but I’m hoping your exit is a little more understated.
If you are serious about weighing your decision to leave the corporate world, I suggest you take one last look at all the things we talked about in this book.
As I said way back in the introduction, hating your job is not a business plan. So how do things look?
What’s in Place?
I wish there were a secret formula to ensure that the business idea you have been madly brewing in your mind is going to generate enough income to compensate for your current salary as an employee, if not much more. That would make me a very rich woman. Unfortunately, there are many, many factors that go into determining business success. One person can have a great, well-researched business idea that seems destined for success on paper, but whimpers out due to a poor sales and marketing effort. Someone else can have an airtight marketing plan that skyrockets exposure and generates lots of interest, but implodes due to poor operations planning or cash flow management.
Napoleon Hill, in his 1937 book Think and Grow Rich, names six basic fears that hold us back from success: fear of failure, fear of poverty, fear of criticism, fear of old age and ill health, fear of loss of love, fear of the unknown.
Quitting your job to start a business pretty much hits every one of these fears, so is it any wonder you are taking this process seriously?
Read over this checklist and see how prepared you feel.
Chest-Bursting Enthusiasm
In order to birth your business idea, you are going to have to have a tremendous amount of energy and stamina. When you are totally enthusiastic about an idea, you don’t have to worry about “staying motivated” or “dealing with procrastination,” concerns voiced by many prospective entrepreneurs. Here are your enthusiasm checkpoints:
• When you think about your idea, do you get a big smile on your face?
• Do you think about it all the time, whether or not you are working on it?
• When you think about it, do you feel physically good?
• To use a Martha Beck term, does the idea of starting your business feel more “shackles on” or “shackles off ”?
• If you had your daily expenses taken care of, would you work on the idea anyway because it is so exciting to you?
• Do you see how this business fits into your overall life plan? Would being successful in this business give you the kind of life you want? Would you be happy while doing it, not just once you were making money?
• Have you looked your fears in the eye, dissected them, and separated the lizard variety from the legitimate ones?
A Solid Business Case
Passion without a business model or viable market is a sure road to perdition. Business case checkpoints:
• Have you spent time developing and defining your idea?
• Have you prototyped and tested your idea with real people in your target market?
• Have you made sales, or signed up people on your mailing list, or gotten them to download your trial product?
• Do you have a viable business model? Is it based on sound principles or pipe dreams?
• Are you willing to change strategies immediately if things don’t go as planned?
• Can you identify your competitors?
• Can you describe what makes you different, more effective, or more appealing?
• Could your business survive if the market radically shifted?
• Do you have a truly useful product or service?
• Do you have all the right business processes and infrastructure in place to execute your business idea?
• Have you consulted with professionals to make sure you won’t get sued, audited, or arrested?
• Are you prepared for various disasters, natural and otherwise?
An Eager Market
You know that your business cannot serve everyone in the world. Who, exactly, do you want to serve? Do they have deep, important problems that your product or service will address? Will your product or service make them money, save them time, build their brand, or improve their health? Do you know this or are you just making it all up? Market checkpoints:
• Can you define your target market in clear and specific terms?
• Do you know where they congregate in person, online, in associations, or in the media?
• Have you spent lots of time with them?
• Do you know what they crave?
• Do you know what will happen to them once they buy your product or service?
• Do you know what they care about deeply?
• Do you know how they like to communicate?
• Do they have access to cold, hard cash to pay you for your services?
• Are they the kind of people who would be fun to hang out with, regardless if you were doing business or not?
A Money Plan
As I mentioned in chapter 12, if you don’t manage the money side of your business, you are destined for misery. Financial checkpoints:
• Are your personal finances organized and tracked in a systematic way?
• Have you improved or are you improving your credit score?
• Do you have six to twelve months of living expenses saved?
• Do you know how much money it will take to get your business off the ground?
• Do you have the money to get it off the ground?
• Are you up-to-date with your taxes?
• Do you have a process in place for managing finances, or an outside resource that will do it for you?
• Have you talked with a financial planner about the implications of your change in employment status?
• If you are really close to retirement, have you thought through the costs/ benefits of quitting before fully vesting in your plans?
• Do you have solid Plans B, C, and D that you can activate if things don’t work out as planned? (Remember, they never do.)
A Marketing Plan
You may know exactly who you want to work with, but if you can’t actually talk to them, how can you expect to make any sales? It may take a good, long while for you to build a relationship with mutual knowledge, respect, and trust, so you must get started right away. Marketing checkpoints:
• Have you chosen a marketing model and are you implementing it step by step? (Duct Tape Marketing, Action Plan Marketing, and Michael Port are all great models.)
• Have you started an official opt-in mailing list?
• Do you communicate with your list at least once a month?
• Do you have a functional Web site that clearly nudges people to do what you want them to do? (Sign up for your list, download your product, join your community, etc.)
• Are you doing a handful of marketing activities consistently each month like writing articles, blogging, speaking, participating in online forums, or inviting interesting people to lunch?
• Do you have a clear referral program in place for happy customers?
A Healthy Approach to Sales
I worked with salespeople for years and am convinced they are born with special (some say mutated) genes. Excellent, ethical salespeople are totally excited by the sales process. Most first-time entrepreneurs, on the other hand, feel like throwing up at the thought of asking prospects for money. The fact is that you are going to have to talk to lots and lots of people about your product or service. If you are deathly afraid of asking for money, you must get over it. Selling checkpoints:
• Do you know what problem your product or service solves?
• How does it add specific value to your customers?
• Are you a good investment for other people’s money?
• Do you know what your sales process is? Do you lead your prospects through it or wait for them to take the lead?
• Is your enthusiasm and vision for your idea stronger than your fear and terror of selling it? (Hint: all you need is a 51 percent to 49 percent ratio for it to work.)
• Are you willing to talk about your idea with people every day for the next 1-2-3-4-5 years?
• Do you sincerely care about solving your customers’ problems?
• Do you have a good sense of humor?
• Can you get over criticism, even if it is undeserved?
• Would you feel proud to sell your product or service to your most trusted mentor?
• Do you know how to ask for a sale?
Time to Create the Business
It takes time to get your business up and running. If you have to continue working as an employee while you develop your business, create a project plan and carve out time in your schedule to make steady progress. You may need to forgo activities that make you happy such as evening television, golfing weekends, or excessive volunteering. The time will need to come from somewhere, and it is not a good idea to use lots of time from your day job to plan your business. Time checkpoints:
• Have you cleaned up and organized your work space?
• Do you have efficient processes in place for managing your e-mail, tracking projects, and accomplishing tasks?
• Do you have the appropriate technology in place to run your business effectively?
• Have you wiggled out of any nonessential obligations?
• Have you identified strong outside support like virtual assistants, personal assistants, and business partners so you can focus only on what you are best at?
• Do you know the major milestones you have to accomplish to get your business off the ground?
• Do you have the time to do them?
Support from Your Family
Starting a business is a very emotional experience, and you will need all the support you can muster from those closest to you. I gave you tips for talking with your spouse and loved ones in chapter 15. How did the conversations go? Family checkpoints:
• If you have a partner or spouse, do you have a mutually agreed upon life plan?
• Have you listened at length and without judgment to the concerns voiced by your spouse?
• Have you shared your business plans and checked for understanding?
• Do you know what the hot buttons are for your spouse? (Time, money, social status, etc.)
• If you know you don’t have support from your family, are you willing to live with the consequences of moving forward anyway?
• Have you factored time with your family into your business plans?
• If you have kids, have you talked to them about what you want to do?
• Do you have mutually agreed upon metrics like amount of money in bank account, length of time to get business off the ground, amount of hair you are willing to lose before pulling the plug?
• Have you explicitly and mutually defined the role your spouse will or will not play in your business?
• Have you clearly discussed the risks he or she will assume if you are married? (Credit rating, cosigning for equipment or contracts, etc.)
• Have you scheduled regular conversations with your partner to see how he or she is feeling?
• Do you have an elevator speech that is not technically a lie that you can pull out at the holidays, on the phone, and during trips to Mom and Dad’s that makes a good argument for your business idea?
Support from Your Tribe
If you have grown up inside corporate environments, many of your friends may not be experts in entrepreneurship. I cannot tell you how many times I relied on experienced mentors when I started my business—they saved my life many times. There are general online forums for entrepreneurs like StartupNation, specialized forums like MyMicroISV, and some advice for finding a mentor in this book. You don’t need to know everything about your new business, but you should know people who do.
• Have you significantly expanded your personal network?
• Did you sign up for LinkedIn, Facebook, and Twitter?
• Do you have at least one mentor, mastermind buddy, staunch advocate, technical expert, and friend at your fingertips?
• Do you know where members of your tribe hang out?
• Are you well known in the places your tribe hangs out?
• Do you regularly and willingly help others, share information, and provide resources without being asked and without expectation of reciprocation?
• Have you found a way to remove Negative Nellies from your life?
A Mixture of Faith and Mistrust in the External Market and a Backup Plan
I have now lived through two significant upheavals in the financial markets as a business owner: Silicon Valley in 2000 and Phoenix, Arizona, in 2008. What I learned by living through the busts is that nothing lasts forever (both the good and the bad). If your business success depends on the economy staying the same for the next five years, you are doomed to intense moments of panic and possible financial ruin. Work on worst-case scenarios, and always think of your exit plan. Market checkpoints:
• Have you learned as much as you can about the market you are operating in?
• Do you regularly read information about your market?
• Have you identified competitors who are successful in your market?
• Have you studied what they do?
• As I mentioned in the Money section, do you have a Plan B, C, and D?
• Do you have a positive mindset and constructive thoughts about your new venture?
• Are you willing and able to look on the bright side of the most stormy market condition, even if it means radically adjusting your plans?
Turtle Steps
If this list is overwhelming, is there a way you can chip away at it bit by bit?
Keep in mind a few things:
1. If you can make a huge sum of money without too much planning in your first year in business, do it. Don’t let me or anyone else stop you.
2. Faster is not always better. There are really great things that result from taking the time to plan and launch a business. For people who have a lower risk tolerance (financial and otherwise), slow and steady growth can be a lot less scary and more rewarding than an all-or-nothing hundred yard dash.
3. If you think it is easy to make a huge sum of money your first year in business, you may want to test your assumptions. Real-world testing is the best: launch a small product, do a consulting gig or two, try to get some new clients on the side of your day job. I hope I am wrong and #1 applies to you. But I would rather temper your optimism with realism than watch you fall on your face and lose more than you need to in your first year out.
Learn from the Pros
One of the best ways to prevent failure is to learn from those who have done it already. Here is what Guy Kawasaki said about his own journey:
Five Most Important Lessons I’ve Learned as an Entrepreneur, by Guy Kawasaki
This is my last posting for my friends at Sun Microsystems, and I’d like to leave you with something to remember me by: a list of the five most important lessons I’ve learned as an entrepreneur.
1. Focus on cash flow. I understand the difference between cash flow and profitability, and I’m not recommending that you strive for a lack of profitability. But cash is what keeps the doors open and pays the bills. Paper profits on an accrual accounting basis is of no more than secondary or tertiary importance for a startup. As my mother used to say, “Sales fixes everything.”
2. Make a little progress every day. I used to believe in the big-bang theory of marketing: a fantastic launch that created such inertia that you flew to “infinity and beyond.” No more. Now my theory is that you make a little bit of progress every day—whether that’s making your product slightly better, increasing your skill in one small way, or closing one more customer. The reason the press writes about “overnight successes” is that they seldom happen—not because that’s how all businesses work.
3. Try stuff. I also used to believe that it’s better to be smart than lucky because if you’re smart you can out-think the competition. I don’t believe that anymore—this is not to say that you should strive for a high level of stupidity. My point is that luck is a big part of many successes, so (a) don’t get too bummed out when you see a bozo succeed; and (b) luck favors the people who try stuff, not simply think and analyze. As the Chinese say, “One must wait for a long time with your mouth open before a Peking duck flies in your mouth.”
4. Ignore schmexperts. Schmexperts are the totally bad combination of schmucks who are experts—or experts who are schmucks. When you first launch a product or service, they’ll tell you it isn’t necessary, can’t really work, or faces too much competition. If you succeed, then they’ll say they knew you would succeed. In other words, they don’t know jack shiitake. If you believe, try it. If you don’t believe, listen to the schmexperts and stay on the porch.
5. Never ask anyone to do something that you wouldn’t do. This goes for customers (“fill out these twenty-five fields of personal information to get an account for our website”) to employees (“fly coach to Mumbai, meet all day the day you arrive, and fly back that night”). If you follow this principle, you’ll almost always have a good customer service reputation and happy employees.
I hold these truths to be self-evident and hope you can use them to kick butt and change the world.
1
The Cosmic Joke
You know the funny thing?
There will be someone who checks every single box in this summary chapter and still will not make enough money to support himself.
And there will be someone who does none of it, who quits her job on a whim, makes up a product or service in a burst of inspiration and flings it out in the world to great financial reward.
What I have found, and what I offer, is that business success is not the real reason to undertake this adventure.
Nothing will teach you more about yourself. Nothing will stretch you and challenge you and confound you like running your own business. Nothing will bring you to your knees in agony, and in joy, like trying to create something out of nothing.
So the questions become:
• Will I be a better, smarter, more compassionate human being for having attempted this, regardless of the outcome?
• What will make me a little bit less like the guy in the “Cat’s in the Cradle” song?
• Will the world be a little bit better because of my efforts?
Make Meaning
GUY KAWASAKI, THE ART OF THE START
The truth is that no one really knows if he is an entrepreneur until he becomes one—and sometimes not even then. There really is only one question you should ask yourself before starting any new venture:
DO I WANT TO MAKE MEANING?
Meaning is not about money, power or prestige. It’s not even about creating a fun place to work. Among the meanings of “meaning” are to:
• Make the world a better place
• Increase the quality of life
• Right a terrible wrong
• Prevent the end of something good.
2
My Parting Advice
If you took this process seriously, you just did a whole lot of work.
You excavated your soul. Found your muse. Read books. Surfed blogs. Worked late nights. Had tough conversations. Cut back, cleaned up, scrimped and saved. Planned, tested, failed, adjusted, and tested some more. Put yourself out there in the world like you never have before. You gathered reinforcements. You planned, and hoped, and evaluated.
Now you are here, peering over the edge.
This is it.
No amount of data, checklists, spreadsheets, focus groups, analysis, or information is going to tell you if it is the right time to quit your job.
It is a leap of faith. You can choose to take it or not.
If you choose to leap, congratulations. Welcome to the other side. I have been waiting for you.
If you choose to stay, I support you. When you are ready, I will still be here.