You’ve done it. You’re making sales, you’re buying office supplies, and your side gig is starting to look like it’s the real thing.
But you’re also used to the consistent paycheck and schedule of a 9-5. Despite the dream of working for yourself, you’re just not sure if you’re ready to be your own boss yet.
Now you’re asking yourself one question over and over: when is it time to make the leap to full-time entrepreneur?
There may not be one individual sign. In fact, there may be many. So in the spirit of Jeff Foxworthy, here are some of the most important omens that you’re ready to ditch the 9-5 and begin the valiant life of an entrepreneur:
You might be ready to ditch the 9-5 if…
You Have a Business Plan
Dwight Eisenhower once said that plans are essentially worthless, but the act of planning itself is essential. So it is with business plans.
It doesn’t even matter if your plan is a little bit off the beaten path. Scott Adams of "Dilbert" fame wrote in his most recent book, How to Fail at Everything and Still Win Big, that goals aren’t quite as important as systems. In fact, some goals can look downright strange to non-entrepreneurs if you don’t view them as systems.
Take Richard Branson’s "Virgin" brand — the leap from record store chain to airline might not make sense to most of us, but Richard Branson’s plans for his brand were different from the conventional wisdom. By focusing on the systems that create success, he could leverage that brand into an entirely different business atmosphere.
But it all starts with having a solid plan in mind: a reason or system for doing what you do. If you don’t know what you plan, then you don’t know the next steps. When you sit down and plan, the next steps become obvious.
You’re Earning Enough Money
You know that old saying "don’t quit your day job?"
It only applies if your day job supplies the money that supports you and yours. If your side business is only garnering $5,000 a year and your day job brings in the remaining $50,000, it’s probably not time to quit the day job just yet.
But if your side business is earning $30,000 a year and your day job only brings in $35,000 a year, there comes a point in which your time is better invested in growing your side gig.
Deep down, entrepreneurs know that time is money. And if your day job has gotten to the point that the investment of forty weekly hours is not worth the pay you get in return, there’s a chance that earning that income is actually getting in the way of your true earning potential.
You’ve Tested the Market
A/B testing, advertising, actual product or service sales — have you done any of it?
Testing the market is much more than simply testing your own ideas. It means putting your feet on the pavement and actually giving your side gig real effort.
Consider the way that McDonald’s introduces a new sandwich to its menu. Sure, they have focus groups and executive meetings and lots of preparation with their professional chefs.
But they don’t take a sandwich national until it’s been tested by the real conditions of an actual, functioning market. Most recently, the Sriracha Big Mac — an idea that sounds like a slam dunk on paper — began testing in limited markets in Ohio.
McDonald’s understands one fundamental reality of business: true market testing means exposure to the real market. Focus groups might give you interesting feedback, but until you put real people in the real position of buying your product or service, you just don’t know what they’ll really do.
Until you’ve tested that market, you haven’t found out if your idea has legs or not.
You Have a Backup in Place
True: some entrepreneurs succeed after burning their bridges. But beware of survivorship bias: you only hear success stories like that because they survived long enough to become success stories.
You hear about Bill Gates and dropping out of college. You don’t hear about the entrepreneurs who dropped out of college without a great idea in place and regretted it ever since.
This doesn’t mean you have to everything set in place. What is entrepreneurship without risk, after all? But you’ll have an advantage if you have one of the following in place:
A spouse or partner with a consistent paycheck. Two paychecks is great, but leaning on one paycheck can make the early, difficult days of the entrepreneur’s life possible. In fact, you may not look at it as leaving your job; you may just chalk it up to diversifying your incomes.
A job or career to which you can return at any moment. Being an entrepreneur means there’s always risk, but it doesn’t hurt if you have a secure enough relationship with an old boss that you can always come crawling back. And if they let you transition to part-time hours while you put your feet in the water, even better.
**An emergency fund. **Most personal finance experts agree that having an emergency fund in place is one of the best things you can do with your money. With six months of living expenses set aside, you’ll have some flexibility should you ever need to return to the workforce.
Are you ready?
One word of warning: no matter how many signs there are that tell you to make the leap to full-time entrepreneur, no one will ever come up to you on the street and say, "Hey, you – it’s time."
In fact, consider this your first real decision as your own boss: getting the timing right. You’ll have to get in the habit of having the final say over your own personal destiny, after all. You might as well start here – make your decision, and stick to it.
Whether that means three more months at work until you’re sure, or taking the leap after you’re done reading this article, you’re the one who makes the call.
As if you’d have it any other way.