My Best Advice for New Entrepreneurs

The Money Blog Network is doing a group writing project this week on the best advice for new entrepreneurs. This is my contribution.

I've never been a "true" entrepreneur. Sure, I've had side businesses and hobbies that have made some decent money, but I've never fully committed to entrepreneurship by quitting my job and going out on my own. So my advice may be "tainted" a bit accordingly. Just wanted to state that upfront so you all know where I'm coming from.

Anyway, here's my best piece of advice for new entrepreneurs:

Don't quit your day job until you've got at least a decent start on your new business.

Just like I wouldn't quit my job until I had a new one, I wouldn't quit to go out on my own until I had at least a start (or hope of a start) at making some money from the new venture. To do otherwise would simply be too risky for me given that there are a lot of other ways to make more money without quitting your job. That said, I understand that this advice might be contrary to successful entrepreneurship -- it might slow you down or even keep you from ever going out on your own. Maybe that's why I'm not an entrepreneur -- I'm not willing to take on that much risk.

What do you think of this advice -- is it good or bad? And what is your best piece of advice for new entrepreneurs?

Here's more on this topic from other MBN sites:

• Create a Business Plan by Answering 4 Simple Questions
• Are you thinking of quitting the nine to five?
• Can You Be an Entrepreneur in Your Spare Time?
• My Best Thoughts For The New Entrepreneur
• 5 Tips for Starting a Small Business
• Advice for Entrepreneurs
• Encouraging your budding entrepreneur - Part One: Benefits

Comments

[J]

Off-topic, but the ad served by google in my RSS reader doesn't seem to fit with the spirit of the blog. Seems like a get rich quick scheme type site.

[Michael Martin]

Great business advice that I would 2nd, next to the best personal advice of not to take a sub prime load with interest only (or fractional interest) payments.

,Michael Martin

[WiseMoneyMatters]

Honestly, my best advice is to "just do it". The more time you spend wondering whether your idea for a business would work, the less likely we are to do it. I've ran a full-time business which failed and 2 part-time side businesses (one which is my personal finance blog that I just started). If your not sure whether you can make it or not, the only way to find out is to actually do it.

Now this doesn't mean not getting good advice and doing the research, but don't spend your time talking yourself out of it.

[Zombie Money]

I see both sides to the argument. The only way I would leave a job is if I'm 110% sure that the business will succeed otherwise go carefully especially in this economy.

[Paul]

Obviously there are two trains of thought....build up your new income on the side and wean yourself off your real job into your new business, or go for it, burn your bridges and commit everything you have to making your new business work. Having been through both scenarios, I have to say that adding another income to your present situation and then growing it to the point that you can give up your "day job" is the better way to go. My goal is to Generate 7 Streams of Income that become almost automatic, then I can quit my regular job.

[fathersez]

I'll have to vote with Zombie Money. There cannot be a clear cut line.

Yes, your advice is far less risky, but also does not allow for devotion to a budding business.

And a start up is when your passion should be ferociously poured into the project.

Like someone once said, maybe we should be given the sack before we can really create a business.

[FMF]

J --

I'm running the ads in beta test as a conversion from Feedburner. I didn't get a chance to approve these, but they assure me that in the future I will be able to.

[Eric]

I think this is a good piece of advice, particularly for prospective entrepreneurs who are a bit risk averse. It can be frightening to give up the stability of a job for someone else to work for yourself, and there's a HIGH level of risk associated with doing so too early.

Entrepreneurship is an incredible adventure, but just like you wouldn't jump off a cruise ship without a life raft in sight, you shouldn't jump into a new venture without knowing it can support you for at least the short-term.

[DCS]

I would add, especially if you take the quit your current job track, to expect it to take at least twice as much money as you think you need and three times as long as you think it will take to get going (and by that I mean make enough to pay yourself). I didn't make up that rule of thumb, but it seems about right for the small business in which I had a minor investment.

Unfortunately we did not have that much time or cash, and now the entrepreneur has no credit or house.