So you are into a full time job right now but interested to run on your own in the near future.
Awesome, the world needs entrepreneurs like you.
But before the big day arrives, why not prepare for it in advance so that you are not caught up with unpleasant surprises.
Below, I have mentioned 8 things which, in my opinion, any wannapreneur should focus on while (s)he is still in a full time job. I have my tick marks across each of these points and I can vouch that they helped me transition
1. Get a term life insurance
You may be single or married, salaried or in business, wannapreneur or an entrepreneur – just get a term life insurance for yourself (and separately for your spouse, in case he/she is also earning).
Term life insurance is an essential component of your overall financial planning exercise and there should be no reason to delay the decision of ge
Especially when you are planning to switch to a lifestyle of an entrepreneur where your future earning potential is unknown (atleast for the initial few years), it makes more sense to buy a term life insurance so that your family would be taken care of just in case you are not around.
While the sum assured (which is the money the beneficiary gets in case of your death) in a term insurance policy depends on your annual compensation and is a sole decision of the insurance company, I would suggest to apply for atleast 1 crore as the sum assured amount of your term plan.
This corpus is more than enough for a middle class family to comfortably survive, if not thrive.
As far as I am concerned, I purchased an online term insurance from Aegon way back in the year 2011, covering me till the age of 76 years, at a paltry premium of just 11.8k per annum.
Don’t delay this decision any further. Get yourself an online term plan at the earliest; your dependents will love you for this decision once you are not there any more.
(Compare multiple Online Term Plans for free here)
2. Buy a health insurance
Since you are planning to shift to a financially unpredictable life, do cover yourself for eventualities, and health being a big one.
So before you leave your job, get a health insurance.
Get sufficient coverage in your policy, and if you have dependents to take care of , buy a family floater and cover all your dependents via that policy.
Some of you might have a health insurance policy offered by your employer. That’s awesome, but that shouldn’t be a reason not to buy a health policy on your own.
Job security in today’s time is a myth and a health emergency may be too much for you to handle when you don’t have a job.
In my case, I have taken a Family Floater plan of ICICI Lombard for a base sum assured of INR 10 Lacs, covering me and my wife at a premium of Rs. 10k per annum.
3. Build an expense buffer
The first step to effective financial planning is to know your monthly expenses.
You should be aware of your monthly spends, broken down into categories like groceries, utilities, travel, entertainment etc.
If you don’t keep a track of them, start doing this from today.
Once you are aware of your monthly expenses, have an expense buffer in mind and build towards it aggressively. This is the buffer you will touch only when you have no money from any other source of income.
This will come handy specially during the initial days of your struggle as an entrepreneur when there wont be any active source of income.
There’s no formula for the amount you should have in the expense buffer.
The bigger, the better. The bigger your buffer amount is, the more runway you will have while you switch from a full time job to entrepreneurship.
In my case, I have maintained an expense buffer that can support me for a period of 1 year. That’s the time I think should be sufficient to build some revenue in a venture.
4. Run a Facebook page for fun
The points mentioned above are more from covering you for the emergency situations.
Now comes the skill building part.
And the first step is to create a Facebook page and run it purely for fun.
Reason: Facebook is a force you just can’t ignore, and your first step to digital marketing should start with Facebook.
So build the skill set while you are still in job.
Eventually, as an entrepreneur you are supposed to market and sell your products/services, and the practice I am suggesting here will come in handy at that time.
Just choose a topic you are passionate about (sports, finance, stock market, travel, fashion – it can be anything ), create a Facebook page on it and run it towards a goal (like gaining 100 followers in next 30 days).
Keep defining the goals and build a strategy on how to achieve that goal (and which should be non monetary, so that you are not under any pressure).
Remember, you are not supposed to earn anything out of this page yet, just focus on building an audience and engaging them via your Facebook page (Facebook Analytics will come handy to understand how engaged is your audience).
Repeating once again, the objective is that you learn the following 3 essentials skills:-
- How to build an audience
- How to engage the audience
- Learn Facebook features like adds, surveys, polls etc.
If I talk about my journey, I started my first Facebook page by name of Ghanchakkar in the year 2012. This was a fun page aimed at discussing the latest in news by ways of memes.
I used to create few memes on my own, but most of the content was syndicated from other free sources.
The idea was to explore Facebook features offered to businesses and practice them in a live scenario.
And the benefit?
Last year, as part of Preper, I ran few Facebook campaigns to sell our RBI Grade B course. I was able to sell an INR 10K course via Facebook, at an acquisition cost of around INR 100 per person, thanks to the years of learning I had while running my Facebook page.
5.Run a blog for fun (and learn digital marketing)
This suggestion succeeds the above one because running a blog needs far more commitment than running a Facebook Page.
But that’s what you have to eventually aim for. You have to define an audience, write content to engage that audience and market yourself. On your way, you have to learn about content marketing, social media marketing, website optimization, email marketing and so on.
And believe me, these things should be known to you like the back of your hand when you enter full time into entrepreneurship.
For the initial few months, you have to do all this stuff at your business, before you scale up and get employees to do this for you.
Even when you have employees, for the initial few years, you will be working closely with your employees to help them define the audience and run campaigns.
So why not start building on this skill set right from today?
6. Experiment with few money making ideas
Before you leave your job, work on at least few money making ideas.
When you make money (irrespective of the amount), you get an adrenaline rush that prompts you to make further effort, hence you get some more learning.
Think of few ideas that you can execute, given your constraint of time and capital available, and start implementing the one you think makes the most sense.My first side venture was a fashion accessory website which I created using BuildaBazaar e-commerce platform in the year 2012 (it was by the name Zohra Fashion).
It was a great learning experience and I serviced around 100 orders in a span of around 4 months, before I shut down the shop (will discuss the reasons in a separate post).
While I made some financial loss in the entire pursuit, I got enough confidence to sell on my own and build a customer base. Plus, the learning was immense.
This learning helped me in my second venture (English speaking classes), third venture (Online courses for RBI Grade B) and the fourth venture (online GDPI preparation). After running three side businesses and making money out of the two, I now have enough confidence that if I put my effort in my business, I can earn from it.
This confidence is the biggest thing you need while you transition from job to entrepreneurship, and it’s better to gain this confidence while you are still in job. It will make your transition less painful.
7. Start identifying your future team members
There is so much to do in this world that you will eventually need help of others to scale up your business. Better identify them while you are still holding your job.
While working on your side businesses, start identifying people who can come to your rescue when you need them.
As an example, as part of the side businesses I executed, I have built my team of freelance web developers, content writers, tax accountants and graphic designers. I now have a go-to person for most of the tasks I would need to execute when I transition to my business.
So keep building your network. Remember, if you have to see further than others, you have to stand upon the shoulders of giants.
Keep looking out for the ‘giants’.
8. Look out for a mentor
You need to have a mentor in life, someone who can listen to your challenges/problems and can offer you suggestions and help; at least show you the possible courses of action.
It’s not supposed to be a formal relationship where you declare the other person as your mentor. Your friend, spouse, parent, teacher or a relative can play the role of a mentor in your life. Like any other relationship, mentor-mentee relationship has to be built over the years and effort needs to be made more by your mentor to help you with a selfless advice.
I am lucky to have Ankit, one of my friends from the B-School as my mentor. But how did I happen to identify him for this role?
Ankit runs a business of his own in Ahmedabad, and while I was working on my side businesses, he always showed excitement in my business ideas. Whenever I used to face a roadblock, my instant response was to give him a call and take his opinion. His advise is always genuine (and sometimes too harsh), but I realized that it was always an objective viewpoint devoid of any emotions.
Identify your mentor in life as well as in business. This will make your entrepreneurship dream whole lot easier.
This list is based on my experience and the things I have done to prepare myself for a life of an entrepreneur.
What are the things you are doing while still in job, to prepare yourself for entrepreneurship ? Do leave your thoughts in the comments below.