Is it crazy to quit a 6+ figure salaried job to do a startup right now? Is my new year's resolution misguided? Was thinking about pulling the trigger tomorrow.
I don't think that's what he's saying. I interpreted it as "If your startup turns out to be a success, then it was a brilliant move. If it doesn't, it was a crazy move"
"We rarely regret the things we do in life, we almost always regret what we don't do in life." - my next door neighbor...he said this to me when I told him I was quiting my job to work on a personal project that was certain to fail. It doesn't matter how the project turned out, but he was right.
Of course it is crazy. So what? I did it 7 months ago. Leaved what had become a 350 people company to start a new project. Back to square one. Not a single regret.
I for one like the timing:
First, most blue chips are now completely focused on their core business. Perfect times to try to quietly take the lead on wide open niche or emerging markets.
Moreover, lots of smart people are leaving their employers (voluntarily or otherwise) or are just tired of seeing their company going down the drain. Perfect times to hire bright people for cheap.
That's why I don't think your timing is wrong at all. That is, if your project does not require massive initial funding, because I do have some doubts about funding in the current environment. I usually don't bother to see VCs before breaking even and being able to show 7 figures in sales or revenue. Just arriving around there on the current project, so this month should be the start of the VC pitching circus. We shall see...
All in all, there is no absolutely good or bad timing: it may be the layoff business or the cost-cutting industry right now, but there is always some growth sector worth exploring. It is always the right time to start something whose time has come.
Go for it. Work hard. Have fun.
...and let us know how it turns out. :)
Yes, me and my co-founder will be bootstrapping for at least the first year. But our plans are to become cash flow positive in 6 months. I can probably survive for 3-4 years with no job, my partner at least 1 year.
You have 3-4 years socked away and you're wringing your hands over this decision? I think the answer is no, you shouldn't. That kind of runway should make the decision an absolute no-brainer if you really want to strike out on your own.
I would assume he's taking any obligations he has into account when he says 3-4 years. It's not like anyone would say "I have 3-4 years, except when you take into account my mortgage, kids, student loans, eating, bills..."
No, I'm advocating being realistic about your tolerance for risk. If 3-4 years of runway isn't obviously long enough, then you probably don't have the stomach for a startup.
I had 3-4 years runway when I started and it wasn't obviously long enough (I remember hearing the exact same comment you just posted when I asked for advice). I ended up starting up, failing, and taking another job (still have 2-3 years runway left) and don't regret it at all.
People with 6-figure salaries and 3-4 years runway tend to be calculated risk takers. They don't jump in unless it looks like there's a decent probably of success. That doesn't mean they won't take any risks, just that they want the odds to be in their favor.
All that said, I'd say go for it. You can always get another job, and 3-4 years means you won't be in dire financial straights when you're looking. Starting your own company often uncovers other opportunities that wouldn't otherwise be there if you just sat in a secure day job, too.
Umm... you left your job, tried a startup that failed, and you still have 2-3 years of runway left. It's pretty obvious to me that you had a long enough runway.
I'm not saying this to be mean (plenty of startups fail), but your startup did fail. Your experience isn't exactly a knockout blow to the argument that anyone hesitating to jump in even though they have 3-4 years of runway might be too risk-averse to be successful with their own company.
Someone who has a failed startup is in a better position to give advice than someone who has not.
You seem quite willing to deem someone not ready or not in a position to give advice. Also, before you make a bold claim about someone's character it would be helpful if you read their previous comments.
It didn't really hurt my feelings. We're all (well, mostly) adults here; we can disagree without taking it personally.
I just thought it was kind of odd that you'd suggest someone might not have enough risk appetite for a startup, and then when someone else replies that most entrepreneurs take calculated risks, point out that they failed. Failure is a part of risk. All those folks who did take the risk of starting a startup...well, most of them failed. Does that make them unqualified to give startup advice? Kinda contradictory, given your original point.
I never said you were unqualified to give advice, and I wasn't trying to insult you for your startup's failure (of course failure is a part of risk). My original point was that risk-averse people probably won't have successful startups, and I didn't understand why you would hold up your failed startup up as evidence to the contrary.
Here's another bold opinion: if some jackass like me can persuade him not to do a startup by pointing out that startups aren't for the risk-averse, then he probably shouldn't be doing a startup.
Who's judging anyone? He asked if he should leave his job to do a startup, I said "probably not" based on the fact that he's hesitating even though he has a really long runway.
Okay, fine. I'm more concerned about people who have 3-4 years of runway and still aren't confident enough to jump into a startup without first consulting a website full of strangers. To each their own.
The above comment is inspiring to me - and I think epitomizes why Americans have been so wildly successful in the tech realm.
Up here in Canada... well, a very wise entrepreneur in Toronto once told me: "Up here they ask you how many times you've succeeded. Down there they ask you how many times you've failed", and I think there's truth to it.
In that case you are well placed to give it a shot. There are few certainties in life, but you are not in a bad position.
A few months ago I was in the same position as you, was procrastinating about quitting, and ended up getting made redundant as a complete suprise. Personally I haven't looked back. Nothing is guaranteed, you need to personally decide more which you will regret most: quitting now, taking the risk and going for it, or waiting till till later when the economy might be better, but then you're personal circumstances might have changed. At the end of the day - it has to be your decision, but if you do genuinely have 3-4 years of cash, then go for it!
I would advise on getting some traction before quitting your job. It can be arbitrary - a few thousand users or uniques/month. If the idea is good you should be able to manage that.
Although if you build something impressive enough it's worth it. Even if things don't pan out, you can use the experience to find a better job.
The only thing crazy about quitting your job for a startup is if the startup itself is too crazy to ever work.
Do your due diligence. Don't jump ship for a fleeting idea or some trend-hopping weakling of a concept. Make sure you're fully aware of the risks and have a realistic assessment of the potential rewards.
The difference between a crazy decision and a bold one is a matter of reasoning. It could be the case that a startup offers you the best rewards, not all of which might be financial.
The only possible answer one could give without much more information is "it depends". Any response other than that is mere exposition of the responder's natural bias.
Is it possible to build a proof of concept in your spare time? If so, that might be better than outright quitting. Then again, it depends on what kind of person you are. For some, having the fear of failure makes them more motivated...
I quit my job to do a startup the day I was promoted. It was awkward/hilarious. I haven't looked back since.
The most important question to ask yourself is: what do I have to lose? I didn't own a house or a car. I didn't have a wife and/or kids to support. So the answer for me was very little. Honestly assess what could go wrong and who will be impacted. But I have a feeling you've already done that.
I think it depends what you're doing. I had a quick look at your bio and if what you are planning is the air-compressed scooter then I think this could be a very interesting project and you'd probably regret not doing it. I'm sure you've already done your market research! :) From your bio I don't think you'd have any problems in getting another job if it came down to it.
If you have the market, the money (to survive and pay your bills) and something that people needs, you should go with it. Maybe you could start doing it part time.
He's even more bullish on the Valley. "We have this leverage finance bubble like we had in the '20s, and there's an argument that we're headed to something comparable to the '30s," he says. "Where was the best place to be in the '30s? Probably Los Angeles. It was the hub of new media and technology, with the radio and the airplane. Silicon Valley is the L.A. of the 1930s.
I would definitely consider outsourcing. You have to be prepared to spend some time finding the right people, giving test projects, etc. But if you do it right, you can find amazing people for very good rates. I've done it for my own projects and it worked out really well.
If I could go back and make one change over the last 10 years, it would be to have stayed where I was and outsourced more. Once, for example, I was sure that I had enough for a couple years with staff. I went through it much faster than I thought. Remember that it will not go at all like you're imagining, no matter how good your business plan is, and that no company ever went under with money in the bank.
Lots of costs, risks, benefits... to be weighed.
And certainly a lot of them are NOT about salary and security.
It's worth taking a look at Scott Shane's January 2008 “Illusions of Entrepreneurship: The Costly Myths that Entrepreneurs, Investors, and Policy Makers Live By” - or at least the discussions at Amazon reviews: http://www.amazon.com/isbn/dp/0300113315
It is a huge leap, and this will help you ask a lot of questions about whether you are suited for the startup world, temperamentally as well as otherwise.
Patience, and actively seeking people out. I have no problem now asking people what their entrepreneurial dreams or ideas are. More often than not, people are willing to share ideas, but stall on commitment of any kind (even part-time).
Make sure your founder is also really committed to it. I had one co-founder who kept his daily-job, was married and then, after some months, gave up when we had deadlines and much harder work was required.
Talk to him now about vesting plan and make sure he is for the long haul. Good luck!
A lot depends on your level of savings and your spending habits. How long can you live on your savings at your current spending level? If the answer is "not long", are you in a position to cut back on spending to give yourself a longer runway? If you can't count on your saving for at least six months to a year, staying at your job is probably the wiser course of action.
Is it possible to keep the 6+ figure job and fund your business with your salary? Then, if it doesn't work you haven't really lost anything. If it does, then you can quit. You'll also be able to start now instead of saving up cash and going through it as slow as possible.
Only you can answer that question, depending on: What do you want out of life? How much savings do you have? Can you work on the startup in the evenings while keeping your job? How risk-adverse are you?
I gave my two weeks notice and am staying on one last week before I resign. I hope to start posting incredibly arrogant startup advice based on my successful venture a few months from now.
Is it madness? No, prices for everything are down because of the recession. Now might be a good time to do a startup. The other side is that it will be difficult getting VC funding.
It's so easy to rationalize not doing it but actually, sooner is always better than later when it comes to making yourself happier - life is short and unpredictable and what we think of as security is often a big joke at our own expense.
Well that was my thoughts before I actually did it.. Now that I have the experience, I would say that planning a bit before quitting is important too (that was my failure), also make sure you have sufficiant reserve money to bounce back.
So go do it, but don't jump in with wide-eyed optimism without planning exactly what you want and need to do (but of course be prepared to change the plan)
"Fear, I've come to believe, keeps more people from starting businesses than any other single factor. You hear about other obstacles--lack of money, inadequate support, bad advice--but they pale in comparison with the fear most people have that their new venture will fail."
I was in your position two years ago but in my case I had a serious health problem. I was scared shitless. I didn't want to give up my job because I needed the health insurance. But my job was making my health worse. I quit and second guessed myself for a long time afterwards. But two years later I am fighting fit again. Thinking back, my only question is, why did I wait so long to do what was in my best interest? Most people who knew me thought I had the best job in the world. But I was miserable. For several years (!) I listened to them instead of myself and made my health even worse. Complete and utter irrationality combined with a lack of self-confidence. In the end I only did it because I had to, not because I am a shining example of courage. I really thought I was throwing everything away and yet I was so wrong. Let my stupidity be your guide. Oh, and the company went under after I quit. So much for throwing away my security. The question is really much simpler than you think.
