So you think you should start your own business?

Redundancy is often a point in time where people will reflect and think about their career options. While everyone’s Career Transition journey is unique, there are a few common avenues that we see participants exploring as part of this journey. One of these can be looking at or considering their own business.  

There are many reasons that people may consider starting their own business. Some of these include: 

• It may be something they have been considering or daydreaming about for a while and now is the perfect opportunity to look at it. 

• They are tired of the bureaucracy involved in larger businesses and want more involvement in key decision-making for themselves. 

• A feeling that if they work for themselves, they are in control of their own destiny and won’t have to worry about being made redundant again (given the anxiety and insecurity that can be created by going through a redundancy). 

• Or some may be struggling to find a job in their field and decide to create their own work and opportunities. 

Redundancy can help create time and the opportunity for people to explore the idea of starting up or purchasing their own business (sometimes in conjunction with also exploring the market for a job). Below are a number of questions we encourage these people to consider to ensure they go into any opportunities with ”eyes wide open”! 

How to decide if this is the right next step for you? 

When working with participants who are interested in their own business, we like to explore some of the following areas to help them determine if it’s the right next step for them:  

• Why do they want to do this – money, anxiety, passion? 

• What type of business do they want to pursue?  

• Is it an area where they have expertise and wins on the board? If yes, starting a business could be easier. 

• If it’s no, or different industry requiring new skills, knowledge and expertise,  they need to do their due diligence and speak to people in the industry or who run those types of businesses.  

• Have they done any market research or spoken to people in the market who might be in a similar industry? 

• It is important to understand the gaps, is it a product or service that is really required, the likely lead time for generating work, and how to educate the market about the need for their product or service. 

• Have they worked out how many hours or days per year they will need to work to make enough money? Or how much they will need to charge for their services? 

• Can they sell their idea? And what is their proposed process for doing this? 

• How comfortable are they living in the grey space and how will they manage uncertainty of clients and income? 

We also encourage them to consider the lifestyle they want to live and how much time they are willing to commit to the business, as well as how they want to get out of it eventually (particularly if this business is a partnership arrangement).  

Risks, benefits, and challenges 

There are a number of benefits that come from running your own business, including having a greater sense of autonomy, being able to do work you love, choosing who you work with, building something and creating a legacy, and a feeling of reward from doing something about which you are truly passionate. 

Of course, there are also some risks and challenges. The main risks are financial and reputational. In terms of challenges, setting up a business from scratch is very much a long game and can be a steep learning curve, that requires people to constantly make and learn from mistakes and re-evaluate their approach.  

It is important to understand and expect that the financial return may take time, so ensuring that you have sufficient financial resources to support you through this time is essential.  

Setting up a business 

It takes time to set up a business properly. Most people enjoy the process of creating a brand, concept, and webpage, but there is a lot more that needs to be considered or done in order to be successful. One of the common traps people fall into is underestimating the administrative side of running a business and what this takes, especially in the early days.  

While there are whole libraries of books on this topic, a few tips we like to share with participants around setting up a business include: 

• Involve a lawyer and accountant if appropriate from the start i.e. be clear on partnerships and contractual arrangements. 

• You can’t be all things to all people, so clearly define your service offerings 

• Work out your business plan: 

• How much do you want to earn? 

• How much time are you prepared to commit to it? 

• Are you covered by insurance? Do you know what insurance costs? 

• Establish a billing system and records management system. 

• Consider an initial soft launch. 

• Constantly re-engage with the market, keep across trends, and be reactive and adaptable 

Exploring and daydreaming can be fun when looking at running or starting your own business. You may get lots of encouragement or doubters, and this can be reassuring or cause concern, but at some stage it is necessary to make a commitment and if it’s the right option for you, keep a strong focus, do the work and understand what success looks like for you!