- 5 Ways to Fund Your Startup Without Giving Up Equity - March 4, 2019
- How to Grow Your Startup by Acquiring a Business - August 10, 2018
- How to Use Payroll Financing to Grow Your Business - July 25, 2018
Launching your start up while working a regular job
Many entrepreneurs launch their startups while they work a day-job for another company. This arrangement offers them the flexibility to earn a salary while also allowing them to focus on their venture. While this situation is ideal, it’s difficult to manage. It requires a very delicate balancing act.
In this article, you will learn one simple thing: how to run your startup in a way that allows you to keep your day job.
Losing your job could set you back years
Your job provides you with a steady paycheck and benefits. It’s a safety net that can enable you to run the startup with a freedom that few entrepreneurs get to enjoy.
Obviously, losing your job could have serious consequences. Unless your startup is ready to pay you a salary, you would have to find a new job. And once you find the job, you would need time to learn the ropes and settle in. This process could easily set you back a year – or more.
The most important rule
If there is one thing that I want you to remember, it is this: treat your employer with the same respect that you would want your employees to treat you with if the roles were reversed. If you follow this simple rule, you will probably do fine. Here are seven rules to help you run your startup while working a regular job:
Rule #1: Does your work agreement allow you to run a business?
Most employees sign employment agreements when they start working. These agreements can be as simple as confidentiality or non-compete agreements, or they can be complex, full-blown employment agreements with multiple restrictions.
If you have signed any employment-related agreements, your best bet is to have an attorney review them. This step helps ensure you can start a business without breaking any prior agreements.
Rule #2: Do your job during work hours and startup work during off hours
Do your job – and only your job – during normal business hours. Make sure that your work output and quality remain good.
Run your startup outside of regular business hours. It’s difficult, but many entrepreneurs have done it. I did it when I launched my company, working a few hours before work and after work. I also worked every weekend for of years.
For a number of reasons, don’t be tempted to do startup work during business hours. Obviously, there are ethical reasons. Your employer is paying for a full day of work and you should give them that. There is also the risk that your work could suffer or your supervisor could catch you.
Lastly, there is the matter of intellectual property. Most employees, especially those in technology, sign agreements that give intellectual property rights to their employer for any and every concept developed at work. You don’t want to put yourself in the position of having to give your idea to your employer.
What happens if you must handle an urgent startup-related task during the work day? Handle it during your break or take a long lunch. Don’t make a habit of it, though. And, by the way, don’t handle the startup issue from the office. Do it somewhere else (see rule #4).
Rule #3: Don’t take clients away from your employer
Few entrepreneurs change industries when they launch their startups. Instead, they start businesses in areas and industries related to their current employment. This approach makes sense because they can leverage the expertise they have built in the industry. However, this scenario can also put you at odds with your employer.
If your startup competes directly with your employer, consider resigning. It’s the smart thing to do. Most employees have to sign non-compete agreements, anyway.
Taking business from your employer definitely puts you at odds with your employer. This activity could also have legal consequences. Employers will not hesitate to take legal action against employees who are taking away clients.
However, this rule has some gray areas. Here is an example. Let’s say that you work for a marketing agency that provides end-to-end services to midsize companies. Your business, on the other hand, provides marketing consulting to home-based business owners. Are you competing? There is no clear answer. Technically, you are offering similar services but to a completely different client set.
The best course of action is to consult an attorney. They should be able to give you an answer that is specific to your situation.
Rule #4: Don’t use your employer’s office
This rule is simple. Run your business out of your home, a rented space, or your local coffee shop. Don’t run your business from your work office. That is a surefire way to lose your job.
Rule #5: Don’t use your employer’s equipment
Much like the previous rule, don’t use your employer’s equipment. Buy your own office supplies, computers, software, etc. Getting caught using your employer’s equipment is also a surefire way to lose your job.
Rule #6: Keep your business to yourself
Entrepreneurs tend to tell anyone and everyone that they are running a business. They often boast about this endeavor to certain colleagues. Don’t do this, as it can backfire.
Boasting can often attract negative attention. Colleagues may become suspicious of you. Supervisors may be unsure of your performance or your loyalty to the company. It never ends well.
If you really want your colleagues to know you are a successful entrepreneur, let them know the right way – that is, when your startup has its IPO or gets acquired by a major company.
Rule #7: Don’t linger. Leave as soon as you can
If you are in growth mode, your startup may reach a point where it needs your full attention. You will not be able to hold a job and run the company.
At this point, don’t linger. Leave as soon as you are ready to quit and work in your company full time. This approach is fair to both you and your employer.
Once you decide to leave, resign with professionalism. Thank your employer for the opportunity. Wish your team well, and offer to train your replacement. Leaving on good terms is important. Your colleagues are contacts that you will want to nurture for your entire career.