Here’s a question that comes in frequently from our clients and community participants, and I thought it was worth sharing:
Question: I am curious what your thoughts are on when you know your business is stable enough to drop any supplemental part-time jobs. I have been diving into my heart on this and have some guidance, but would love to hear if you have any practical guidelines that you go by.
Answer: This is a big, perhaps THE big question, eh? I’m not a huge fan of cliff-diving, because people often have really unrealistic ideas of what it takes to start a business and get it to a sustainable financial level.
I’ve maintained, after years of observing thousands of people building businesses, that it takes 18 months to 3 years of steady focus on business development to put your business into true momentum, when you can trust it to bring you a comfortable income month after month.
If you are still working a part-time job and haven’t yet gone full time in your business, here’s 3 things I recommend you do.
1. Figure out your “squeak-by” number.
This is the amount of money you need, on a monthly basis, to keep the roof over your head, the lights on, and food on the table. It doesn’t include extras, or even necessarily saving for taxes that easily.
It’s also good to identify your “comfortable” monthly number, the one you’d ideally like to get to. The problem with having the comfortable number being your initial goal is that it can often seem like too big a leap. Plus, once you have let go of part-time work, it can be so much easier to do what you need to do to get from the squeak-by to the comfortable income.
2. After the number is identified, look at your marketing/enrollment flow.
Does it have any robustness/predictability to it? Do you have enough clients to make your squeak-by, but they came in randomly through luck or good fortune. Or, do you have clarity on how and where to find your best clients, and how to have an effective sales conversation, so if you had the time you could get more clients.
3. Are your clients/customers giving you income for a decent amount of time?
Meaning, do you have repeating income that allows you a certain amount of stability for 3-6 months, or do you start over from scratch each month? For most self-employed professionals, it really helps both the client and the business owner if there is a commitment for ongoing work, rather than just a single session.
To recap, what I’d love to see, ideally, is:
- Consistently making your squeak-by number.
- Clarity on how to market and where to get more clients from, as well as comfort in enrolling them.
- Clients/customers sticking around for 3-6 months each, ideally.
You may not have each of these three completely, but as long as there are enough pieces of each of them that you feel confident that, with effort and focus, you can at least hit your squeak-by over the next six months, AND you have clarity on your next steps on expanding/developing your business, and they are achievable within that same time frame, you’re probably in great shape to make the leap.
In addition, I posted the question in my Facebook timeline, and got some interesting feedback from folks there as well. You can read it here.
How about you? If you made the leap, when did you know it was time to jump? If you haven’t yet, how close are you based on what I’ve written here? Please share a comment below!
Next Steps
Don’t know if you’re there yet, or what you need to get there? Learn about the stages of business development, find out exactly where you, and get personal feedback from us by taking our free Readiness Assessment. We can help you learn where your business is developmentally and what you need to help it grow.
4 Responses
I’d add that aside from the financial factor, which may or may not be an issue for everyone. For me it’s been important to feel engaged in something I enjoy that comes easily (no business development, not a stressful job), gives me a feeling of contributing something valuable, and gets me involved with others while I’m in the process of getting my passion business off the ground. Being self-employed can be a lonely business. It also took me a long time to find the right kind of part-time work. Not only did I need to drop my ideas about the kind of work that would work for me, but I also had to wait for the situation to meet me. Part-time jobs can be difficult to come by.
Great point, Kim. And yes, they can be hard to come by.
Thanks for the sharing the content pointing out the important facts about the part time job!
Thank you!
This prompted me to make an Excel spreadsheet with how long my clients need me for what types of services, how I continue to serve/be in touch, and how frequently I’d be enrolling new clients into what type of services.
I have had the sense I can make my squeak-by number, since it’s very low, so for me, this is a visualization of what it might be like.
What I learned: better to go through the feelings of “oh, wow, I’d need a new client again *already*… yup, then it works…” in the dry run/visualization, than to learn the hard way (only).
I saw how, since I think my clients will sign up for short stints of work with me and then maybe a low-cost membership in a group, I will have to keep hussling – which is a word I don’t really like, but in this context, my business being so new, is going to be invigorating and exciting, because I’ll be learning so much about my niche as I go… I think it’ll be fun, but wow, this was a great way to prepare my heart! I will definitely be longing for (read: hard-working and needing) the next phase of my business’ development RIGHT AS your coursework guides me to it, every. single. time.