The dangers of being a part-time entrepreneur
An increasing number of people are building a start-up while still in paid work, judging by recent statistics.
A report by Bankwest shows that the number of part-time business owners has increased by 19.1% over the last five years and by 27% over the past 10 years.
By contrast, people running their own business full-time dipped by 5.3% in the last 12 months across Australia.
Australians are increasingly grasping onto the security of a full-time job as they take the plunge with their own ventures. But it’s tough splitting your time between very different demands.
StartupSmart spoke to two entrepreneurs in this situation to find out how to make this schizophrenic existence work.
Balancing your jobs
Leanne Anderson is the founder of Getaway Guru, which offers travellers access to accommodation in Italian and French properties that are owned by Australians.
She is still working as a human resources consultant for Mercer.
“It’s a very flexible job and I am able to work at home. Being able to do that is key while I establish my business,” she says.
Anderson says one of the benefits of being employed while building a start-up is being able to take a risk on her own business without losing her financial stability and compromising her ability to pay the mortgage or her lifestyle.
“Having a steady income is what allows me to continue building my start-up, which I’m bootstrapping myself – although I’ve heard what I’m doing being described as ‘golden handcuffs’,” she says.
Another highly motivated person who worked in paid employment while building her start-up is Jen Brown, founder of Sparta Personal Training.
Brown took about three years to transition out of her career as a lawyer into working in her business full-time.
She initially obtained her personal training qualifications while still working full-time as a lawyer before taking a part-time government contract while she was building her enterprise. She walked away from the law in July last year.
For Brown, the big pro of her current situation is making a difference in people’s lives, as well as controlling her own direction.
But she says being stretched too thin is one of the drawbacks of trying to manage a career and a start-up.
“Trying to balance a full-time job, family and my business was very stressful,” she says.
“I’m lucky I have a supportive husband but building the business did detract from time with him.”
The need to focus
Another downside was not being able to fully focus on one thing.
“Half of my brain was in the law and the other half was ticking away on my start-up,” she explains.
“I was trying to spread myself too thin and even my health suffered – I wasn’t exercising enough, which is a strange thing to say for a personal trainer.”
Anderson agrees the toughest thing for her is prioritising her time.
“Often work on my day job increases, and my ability to dedicate time to my start-up suffers, so there’s lots of work at night and on weekends,” she says.
“Splitting your time can slow you down a bit. If I were just building my business I would be able to move much faster through the start-up phase.”
According to Anderson, being able to combine paid employment with her entrepreneurial activities means achieving deliverables for both roles.
“I might go into the office one or two days a week and also manage clients from home. Then when I’m at home working on my business I’m loading properties onto the site.”
“So it’s about allocating chunks of time and keeping your eye on the bigger picture. You have to be really organised and have a long-term perspective but at the same time work away at small goals,” she explains.
Anderson says it can be hard not to let her working commitments become all encompassing.
“But when you’re passionate about something you’re happy for it to take over your life.”
“I probably let Getaway Guru take over more than it should but because I have a family I also have to devote time to them. My life helps to keep me grounded.”
Time management skills
Brown says for her as well, it was important to be quite rigid about how she spent her time – but at the same time she also needed to be extremely flexible.
“It was important to have a plan about how I was going to spend what available time I had to work on my start-up,” she says.
But while I was working my day job had to take precedence and one phone call could put an end to my plans.”
“That said; juggling both required a lot of forward planning and thinking about the best way to spend my time.”
“At the time I did feel resentful about my day job because my heart was in my business and I wanted to get home to work on it.”
“You need to be very productive and work on the things that are going to give you the greatest gain.”
As to the types of start-ups that can handle the founder working concurrently in another business, Anderson says it would be hard to run a consulting business with a foot in two camps.
“It would be a challenge in a business where you need to see clients but because I’m an online business it’s workable. In a service business it would be a lot trickier,” she says.
Says Brown: “Personal training is probably not the ideal start-up to build when you’re still working because there’s a lot of face-to-face time and your clients want you when you’re in the office.”
“Even for evening sessions I often had to break the speed limit to get to a session.”
Ultimately, Brown says she “reached saturation point. I had no available time so I had to take the step to work full-time on my business, before I really had the work there to support it.”
“In saying that, my transition period between the law and my business was longer than I anticipated.”
“Everything seemed to take twice as long as I thought it would. But you have to be patient and realise you don’t have to do everything all at once.”
“Give yourself some evenings and weekends off and remember to look after yourself.”
“Accept everything will take longer than you think and have a transition plan so you are eventually able to concentrate on your business full-time.”
Getting the balance right
Three top tips to balancing a job with a start-up:
- Be clear about what you want from your start-up: is it a lifestyle choice; is it scalable; how will you manage it; and what’s your exit strategy from your paid job?
- Work out what your line in the sand is for leaving work because in the long term it’s not possible to juggle a job and a start-up.
- Be clear about what you’re prepared to commit to at work so as not to jeopardise your time building your start-up.