Don't Quit Your Job To Be An Entrepreneur
People have different reasons to want to quit their 9-5 to pursue entrepreneurship full time. I was drawn to the opportunity to take something from idea to product and being able to “be my own boss”. We all want the lifestyle of a successful entrepreneur but you don’t need to have your own VC funded startup to build a great product.
What I learned from 5 years of bootstrapping two startups and joining an early stage startup that already got funding is that building a company is extremely hard, especially convincing people to be a co-founder, customer, and investor.
Not every app has to be a business. Apps can just be apps.
You can have a product and get your “fix” in building something and being your own boss without building a company. You can even make money off of your product to offset the cost of hosting and make a bit of profit. Having a few fun side projects to go home to after a draining day at your day job could greatly enrich your life. So why aren’t more people bootstrapping and working on side projects? I think there are 4 reasons:
1. You Are Your Own Boss
You can be the toughest, most demanding boss you’ll ever have. When we are our own boss, we expect so much of ourselves that when we don’t deliver to our expectations, it’s a big hit to our self confidence. So we essentially fire ourselves or quit before the project even gets anywhere. You don’t have to work 40 hours a week on your side project. You don’t even have to work 8 hours a week. You (the boss) and you (the employee) should come to some agreement on what’s a reasonable number of hours to work on the project per week and commit to the plan. Three hour a week over the course of three months will make a huge difference.
2. You Picked The Wrong Project
If working on the side project feels more like work than fun, it’s not sustainable as a side project. You’ll be drained at the end of a long work day / work week. The last thing you need is more work. Picking something that is fun and engaging to work on is key.
3. Lack of Focus
Smart and creative people have lots of ideas and are capable to implementing their ideas. They often start building something, but half way through that, start working on something else. That’s generally fine if you can quickly context switch and work in parallel on multiple things, especially if those things have a lot in common. But there’s a cost to context switching. The longer you don’t work on a half finished project, the less likely you’ll pick it up again. It takes consistent work over a long period of time to see results. Thus consistent progress (defining milestones and hitting those milestones), along with the enjoyment of the process itself, are the two most important motivators for bootstrapping.
4. Want Too Much Too Quickly
Anyone with a passion project has likely experienced the desire to want to occupy their days doing nothing but the passion project. If money is not an issue, it’s a very obvious choice. But few passion projects ever become a profitable business or something big enough to get VC funding. A lot of people jump ship too quickly to work on their side project full time before it’s at a point that’s profitable enough to make a living off of or has gathered enough growth to get an investor onboard. Bootstrapping gives you the peace of mind that you can still pay your bills while figuring out how you can make a living from your passion project.
If You Want To Be A Startup Founder …
It’s a tough but rewarding journey full of personal growth. You will need to learn to be both self-confident and have humility - a difficult combination. 9 out of 10 new businesses fail. 75 percent of venture-backed startups fail, the key reasons being lack of motivation and too much pride.
Of course to work as a startup founder, you need someone to pay the bills so you can focus on building a great team, creating the product/service, acquiring customers, and collecting data / make small adjustments to find the optimal product-market fit.
Not every business needs to raise money. Most service-based businesses (consulting practice, pet sitting, tutoring, and restaurants) are profitable from day 1 so they don’t need investor money to pay for any research and development before they can open for business. And it’s not easy to raise money for service-based businesses since profitability is a function of human capital. Think about it from the perspective of the investor. If they are not getting 10x return on their investments, it’s not worth it for them.
If you want to raise money, investors look for 6 things:
If your startup has great people but a mediocre idea, you can still succeed by surrounding yourself with great mentors and be open to feedback from your customers to pivot. If you have a great idea but mediocre people, you’re hosed.
To attract talented people to help you build a company, you have to be a talented person. I lose count of how many non-tech people are on CoFoundersLab with ideas for an app looking for a tech co-founder to build it all. Whenever one of these people reach out to me, I ask them why they haven’t started building something on their own and their response ranges from “I don’t know where to start” to “That’s not my core competency. I’m the ideas guy.”
There are so many free tools, step-by-step tutorials, books, and videos out there that you can use to do anything you want. It amazes me why people don’t take advantage of these. It has never been easier to be a self-starter.
My advice to them is that if you want to build a technology company but you don’t know how the technology works, you are going to run into a lot problems when it comes to hiring, working with freelancers, communicating with your technical co-founder, and estimating how long / expensive an engineering effort takes. Taking some initiative to learn what it’s like building the product is really going to pay off. Also, consider your value proposition to the technical co-founder and consider their perspective:
you’re talking to eminently experienced and qualified people who have spent years building their skills and honing their craft and you’re asking them to take a run on the board and a massive risk with no guarantee of success and the potential of absolutely nothing to show for it.
- Riding Out Failures to Bootstrap a $220k/mo SaaS Company - A story of how someone bootstrapped products after products until finally one succeeds in generating $25,000 a month of passive income for him. Absolutely inspiring!
- Creative Side Projects