You have a full-time job with benefits and a regular paycheck. But you also have a side gig that is beginning to show promise.
It’s turning a profit. You have repeat customers who aren’t your friends. You even have professional packaging, some media attention and a small-business grant.
Could it be time to sacrifice security, ditch your regular job and devote all your attention to your side hustle?
Entrepreneurs who have taken the plunge said there is no one-size-fits-all rule of thumb. The decision is usually personal.
Jean Ross, an Indiana University Health nurse who coordinated care for others on the side, felt irreversibly compelled to go all-in on her startup when her aunt died of complications amid disorganized health information.
Tanorria Askew, a bank trainer who cooked for clients in her spare time, didn’t immediately make the switch when she was cast on the “MasterChef” television show. Her decision came when an inspirational quote arrived serendipitously via email.
Michelle Dudash, a dietitian who creates healthy spice packets, held off until she didn’t have time for two jobs and had to choose.
In none of those cases was the decision crystal-clear. No entrepreneur is likely to receive a sign from the universe—or from their accountant—that it’s all going to work out.
Even Askew’s casting on a major TV competition wasn’t the no-brainer you might assume. “If you win, your opportunities are shaped to build ‘MasterChef’s’ brand. No one is thinking about yours,” she said. “And if you don’t win, all you get is an unpaid 2-1/2-month vacation. No one gives you a tool kit on how to be successful afterward.”
To be fair, contestants leave big reality shows with more than a vacation, especially in a smaller market like Indianapolis. Askew’s fourth-place finish in 2016 led to valuable media attention and the confidence to pursue her dream of working full time in food.
But that’s not why she is still an entrepreneur seven years later, having evolved Tanorria’s Table into 50% private chef-ing and 50% corporate consulting on diversity, equity and inclusion.
Good timing is critical to success, but free publicity alone won’t get you through the two-year period when most startups fail, according to Anthony Murdock, a lecturer on entrepreneurship at Butler University.
The three M’s
Murdock, the faculty director for Butler’s Minority Owned Business Initiative and Innovation and a coach for Black business owners through Murdock LLC, espouses three M’s that entrepreneurs need to be successful: money, mindset and a road map.
Money is a two-pronged issue. Murdock recommends building up an emergency fund while you still have a full-time job—to cover the first three to nine months’ worth of expenses for food, shelter and transportation.
The second prong is the cash flow you’ll need to grow, and he said you can’t understand your business’s financial reality or its true costs unless it has its own bank account. He cautioned against making the leap to full time without one.
Mindset refers not to your own but to your community’s. Do you have the right support network?
“The community is going to remind you that you didn’t make the worst decision of your life,” Murdock said. “There are going to come moments when you really do think, ‘I’m an idiot.’ I know that because I experience it all the time. You need people who aren’t in the weeds with you to remind you what the big picture is.”
A strong community will also hold you accountable when you feel like you are always on the clock working for yourself. Murdock said setting boundaries is critical for an entrepreneur. As a business owner himself—he coaches Black entrepreneurs to use storytelling to achieve success—he never works on Sundays.
For a road map, or business plan, Murdock recommends three versions: a Lean Canvas or Business Model Canvas, one-page documents that answer critical questions; an elevator pitch; and a full strategy.
A plan prepares you to take advantage of a golden opportunity if one comes along, like it did for Askew in 2016, one year into her three-to-five-year business plan for taking Tanorria’s Table full time. She filmed the show in early 2016 and returned to her regular job in April. On her first day back at the office, a quote in an email encouraged taking a risk and betting on yourself. She resigned shortly afterward. If she had kept working full time, she said, she wouldn’t have had time to capitalize on the exposure from the TV show as it aired.
A business plan also involves market research to make sure your endeavor is aligned with current trends. “Look at how many businesses came too soon,” Dudash said. “Study trends, the size of the markets, what’s increasing, what’s on the way out.”
The entrepreneurs interviewed by IBJ also suggested making sure you can answer a few key questions before taking the leap.
◗ Is your name trademarked? Dudash, who makes Spicekick seasoning packets, narrowly avoided a disaster when she parlayed her strong sales into a full-time enterprise.
She hired an intellectual-property attorney to make sure her initial name, Dash Dinners, didn’t infringe on someone else’s naming rights. It did. “Legal Zoom didn’t catch it. Imagine gaining some notoriety and having to change our name,” she said.
◗ Do you have a clear vision? You might think you understand your product or service, but are you in an echo chamber? “If you find yourself arguing with your customer about the service you are trying to give, maybe it needs a couple more iterations to figure it out,” said Ross, the health care coordinator who is launching an app, Primary Record, early next year. “Give yourself pause if you are getting signals that people aren’t willing to pay for your service. Find out why.”
For instance, have you talked to your customers to make sure your offering is on point? “Maybe they don’t want to watch a 90-minute video on caregiving,” Ross said.
“This is basic, but most people can’t succinctly explain their value from the customer’s perspective,” Murdock said.
◗ Do you understand expansion costs? When Dudash first came up with the business idea, she thought she could make the seasonings at home and sell them online. But to grow, she had to increase points of sale to farmers markets, Market Wagon’s delivery service, and across state lines—all of which required that she work from a certified kitchen. That was an extra cost. So were margins that grocery and distributors would later take.
“Some costs will go down, but others will emerge,” Dudash said. “Talk to people in your industry who understand the margins and what you really need to have for it to be a sustainable business.”
◗ Do you have systems in place to hire people? All three women eventually recognized the value of spending money to make money. “I doubled my revenue once I hired someone to support my business,” Askew said.
“It’s scary when you’re first starting out,” Ross said of investing in contractors or employees. “But when you’re a solo-preneur, you’re HR, you’re website maintenance, you’re social media. You get stretched thin. We have tons of programs in Indiana for internships or technical assistance like website creation, so you’re not doing it all.”
Ross also had to develop a system she could pass along to a new hire. When she was the only one counseling clients on how to organize a sick relative’s health care records and communicate with doctors and other family members, she could operate out of a notebook. When she had to let someone else do it, the system wasn’t sufficient.
She used CaringVillage.com and Google Workspace to pull together a workflow system, but she wishes she had spent more time researching and testing technology tools as she was building her company.
“Women, especially, keep dealing with the same problems over and over. But take a pause and think, ‘How can I make sure I don’t keep fixing this issue? How can I contract someone to take this load off so I actually do a skill people are hiring me to do?’” Ross said.
◗ Are you willing to adjust or create multiple revenue streams? Things will change. Maybe there won’t be another pandemic, but you can count on shifting tastes, unforeseen costs and exciting opportunities.
“You should be super passionate but willing to have a Gumby-like mentality,” Askew said. “If you don’t, you will constantly feel like you are failing.”
One “a-ha moment” for Askew came in 2019, when she accepted six speaking opportunities in a week and didn’t get paid for any of them.
“I knew my worth as a speaker, and I needed to start promoting myself that way,” she said. Once she developed a few signature keynotes and branded her cooking demonstrations, she began getting more paid requests for them.
“Call yourself what you are. Then you’re able to create more revenue streams,” she said. “I never called myself a speaker. Now I do. Now it’s my brand.”
Later, when Askew had a chance to write a cookbook, she discontinued some of her least-enjoyable “survival services” to make time for it. But when she finished eight months later, she found herself at another crossroads. Books can take many months to be released. So she took the opportunity to pour herself into the diversity, equity and inclusion services she was offering to corporations. Now it’s half of her business.•