Start-up Tip: When To Leave Your Full-Time Job Ross | September 3rd, 2008
Mike and I stated working on crowdSPRING in the summer of 2006. We incorporated the company in May 2007 and launched the crowdSPRING marketplace in May 2008. We’ve learned many important lessons along the way. In some ways, our experience is typical of other start-ups. In other ways, it is not. I want to share some of our adventures (and mis-adventures) in the hope that it’ll help others looking to start a company or those who’ve already launched a start-up. So, once or twice every week for the next few months, I’ll post a new tip, based on our experience with crowdSPRING over the past two years (and my experience advising technology start-ups over my 13 year career as an attorney).
Start-up Tip 3: When To Leave Your Full-Time Job
A few days ago, I saw an excellent video from Gary Vaynerchuk called “You can have both…Jobs”. In that video, Gary talks about his personal experience in building his internet brand while working a full time job, and suggests that it’s very possible to pursue your start-up dream without leaving your job.The questions for most entrepreneurs are how to manage two jobs, how to determine when it’s time to either abandon or pursue your start-up dream full-time, and how to properly measure the risk involved.
Mike and I met in late 2006 with a former classmate of mine from high school who had started numerous successful online businesses. He liked our elevator pitch and asked a simple question: do you have kids? Sure – I had three (Mike had 2). He proceeded to talk about the effort in starting a technology business and pointed out that it was not a coincidence that most founders of technology startups are young and single. He talked about crazy hours, the hard work, sleeping under desks, and many more things we had read about in stories about technology companies. He wanted to make sure that our eyes were wide open to what we were about to experience.
In 2006 and throughout 2007, I maintained a very active law practice – I was a partner in a Chicago law firm and was representing U.S. and International clients in all types of complex commercial and intellectual property disputes. It was – in many ways – crazy to think that I could maintain an active law practice and pursue a dream I had from early childhood – ever since my family emigrated from Kiev, Ukraine – to start a technology company. I had opportunities in 1998 and 1999, right before the Internet bubble burst, but never found something that I was passionate about (probably a good thing). crowdSPRING was different.
I decided not to leave my law practice in 2006 to pursue crowdSPRING full time. We had not yet committed to forming a company (we did that in May 2007) and we hadn’t even decided that it could be a successful business. So – I was faced with an early choice – how much effort to put forth in doing the research and in trying to figure out whether we could make something of crowdSPRING.
In his video, Gary talks about having to work hard. Real hard. And it’s true. Ultimately, while bootstrapping is a popular practice, it’s not always so easy – both for professional and personal reasons. Mike and I set two milestones. The first was to give ourselves time to research, plan, debate, and determine whether we could build a successful business. We gave ourselves until the end of 2006 to do that. After we decided in late 2006 that we would aggressively pursue our dream, we set a second milestone – my transition from my law practice to crowdSPRING.
Meeting the first milestone – for me – was much easier than meeting the second. I was fortunate to have learned good time management skills early in my career and it was not difficult to replace many of my interests (movies, books, sports) to instead focus on crowdSPRING during the latter half of 2006. By the end of 2006, we decided, after much research, analysis, debate and planning, that we would pursue our dream.
In early 2007, I had to decide what to do about my law practice. We had not yet raised a penny in funding, hadn’t even incorporated our company, and were six months away from writing a single line of code. I had a very successful law practice, was working with my friends and mentors, and was fortunate to make a good living doing what I loved.
After much discussion (with Mike and with my wife), I decided that I would maintain my law practice and work on crowdSPRING until such time that doing both would negatively impact either my law practice or crowdSPRING. At the time, it wasn’t clear when that would happen, but it was really important for me to set a milestone tied to an event – a negative impact on either of my jobs. If I hadn’t set that milestone, I could have drifted for a long time and both could have easily suffered.
It was not easy to set that milestone. It would have been much easier to just leave my law practice. My friends know that I’m not afraid to take risk. But it wasn’t fear of risk that moved me to maintain an active law practice – it was the reality of startups. Most startups fail in their first year. Of those that survive past the age of one, most fail. Leaving at that time would have been foolish – while there are stories of young adults founding successful internet companies and selling them for hundreds of millions of dollars – those stories are scarce. There are far more stories about those who didn’t make it.
At the time, we had no idea how successful crowdSPRING could be. We knew we were on to something important and exciting. We knew that we desperately wanted to pursue our dream. And we committed to work hard to do so.
For me, the most important decision at that time was the time investment necessary to work two jobs. I recalled our conversation in 2006 with my former classmate and his caution about technology startups and the time required to run them successfully. I wasn’t afraid of hard work, but I was terrified that I could not balance two jobs and my family. In early 2007, my oldest daughter was 8, my son was 5 and my youngest daughter was 1. My wife and I discussed the pressure this would put on our family, the need for her to take on more responsibility with the kids, and the extra work I would have to do to continue to create some balance of work/family.
You have to know yourself to understand the risks you are willing to take and your breaking point. Each person is unique and each person’s breaking point is different. Young founders have high tolerance for risk. They don’t have families and typically haven’t started other careers. Older founders with kids have much more to lose.
My advice – based on my experience – is to fairly and seriously measure what you’ll need to do in order to manage two jobs and – if it’s relevant and important – manage some semblance of family life.This is not a simple measure. If you’re not honest with yourself, you’re likely to fail. And nobody but you can make this assessment. I realized that I would need to stop, cold turkey, everything that wasn’t related to my law practice, crowdSPRING, or my family. Everything. All at once.
In one respect, it was easy to do. I knew I was pursuing a dream in co-founding crowdSPRING and also knew that I could do so, while maintaining a law practice, only if I could leverage my time properly. But it was also very difficult because it meant, among other things, no more movies (I used to watch 6-7 movies every week), no vacations for a period of time, no more books, no more golf or tennis, no more television, no more fishing trips, no more reading multiple newspapers every day, and very limited interactions with friends. I stopped all of these things (Mike did too) so that we could work very long days, seven days per week. For a year.
There were many moments in 2007 when things got really tough. Working two jobs takes its toll. It’s hard and even if you are very efficient, it’s still two jobs. There were many weeks when I didn’t see my kids for 6, 7 days at a time. There were many weeks when my conversations with my wife were limited to phone calls.
At one point I received a voice mail from my oldest daughter. She wondered when I was returning home from Germany. This message confused me beause I was not in Germany. I was right there, in Chicago, 20 miles from our house. But it reminded me that I hadn’t seen my kids in seven days. That was a really rough moment for me. It tested my resolve in pursuing a startup and it tested my resolve to continue. I cried. But I was mentally prepared for that moment – as painful as it was.
I didn’t waver, but I realized that I hadn’t accurately predicted the sacrifice I would have to make. The reality is that no matter how hard I tried to balance two jobs and family, I could not do so over extended periods of time. This was not unusual. Many entrepreneurs have similar stories to tell about their personal sacrifice. I mention it mainly to emphasize what my former classmate told us before we started down this path – startups are tough. They require hard work and they take a toll on family. And if you’re working another job at the same time, that impact is magnified many times over.
By December 2007, I could no longer maintain an active law practice and work on crowdSPRING. We were still months away from completing development and launching to beta, but I was approaching major trials for clients in several bet-the-company cases and unless I acted promptly, those clients’ interests would have been prejudiced. We were also running into major problems in our development efforts and I had to focus on those efforts. I was working 20 hour days. Seven Days a week. Since late 2006.I was not willing to further sacrifice lost time with my family.
That was the tipping point and the milestone Mike and I talked about in early 2007. I promptly resigned from my partnership and on December 6, 2007, started to focus solely on crowdSPRING.
So, what take-aways can I offer from my experience in maintaining a full time job while pursuing a start-up? Here are five:
1. Love your dream. Don’t kid yourself. It will be very difficult to work two jobs. You’ve got to love what you are trying to do with your startup. You have to have passion to work 20 hour days for a long period of time.
2.Assess how much time you have. The cliche “time is money” is not a joke. Most people grossly under-estimate how much time they have to devote to something. Working two jobs swallowed up every available minute of my time.
3. Be honest with yourself about what you’re prepared to sacrifice. You know yourself better than anyone knows you. Understand what you will need to give up and understand the sacrifices you’ll have to make. And consider that you might be under-estimating all of these things.
4. Know your breaking point. At some point – and perhaps multiple times – you’ll find yourself near your breaking point. For me, it was the voice mail from my daughter asking me when I was returning home from Germany (I hadn’t seen my kids in one week). For others, it’s finances or other interests. When you approach your breaking point, sit down and assess your resolve. Make sure that you are still committed to doing what you’re doing.
5. Learn as much as you can about what you are about to do. If this is your first start-up (as it was for me), understand what motivates you and what you don’t know. Learn everything you can about your product, market, competitors, customers, users, etc. You will run into many problems along the way, and will be able to deal with them only if you continue to have a search for knowledge and only if you understand the scope of what you are doing.
If you have your own tips or stories, please feel free to share in the comments. And if you enjoyed this post, please also take a look at other start-up tips we’ve written about: