The following is an excerpt from my new book, Get Funded!, available now. Need a copy? Want to write a review? Ping me on Twitter @johnbiggs!
The answer to that burning question keeps founders up at night–literally. Coming home after a full day of work to build another product is exhausting, and not many can maintain the pace. But entrepreneurs with families, at least in the US, need insurance and a steady paycheck. The mortgage won’t wait for your success.
Quitting your day job is a difficult decision, but there are a few guidelines to remember.
First, you need to assess your business in terms of potential earnings. Will you make more if you spend more time on your business? This is called scaling, and the first point of contact with scaling happens when you, the founder, pour yourself into the work. Perhaps try it for a week, spending a few vacation days focused only on your startup. Are you making anything at all? What’s holding you back? What is the opportunity cost? If you are wasting away in a cubicle doing nothing all day, maybe there is a good reason for a change.
The benefit of quitting your job is the clarity of purpose it provides, This is a fancy way of saying it scares you into action. Like drunks and babies, entrepreneurs who quit their jobs often survive the ordeal without a scrape. And, often, it is the act of quitting your job that kicks the startup into high gear.
I think the best example of this is the story of Rod Canion, Jim Harris, and Bill Murto. These three men were senior managers at Texas Instruments. In 1982, they talked about starting a chain of Mexican restaurants but, after some thought, they realized their skills would be better put to use in building what, at that time, was a miracle product: a portable computer.
The trio invested $1,000 each of their own money, and a designer named Ted Papajohn sketched out the first design on a napkin in a pie shop in Houston.
The three founders named the company Compaq. Each quit their jobs–they had wives and families, so the prospect was frightening–and took their fledgling idea to the equivalent of an angel investor who gave them $1.5 million to build their first computer. At the same time, the concept of the personal computer was gaining steam and…