How I Did It: 5 Things to Know Before Leaving Your Corporate Job

The entrepreneurial itch often begins in the corporate world. Here’s the scenario: You’ve spent years building experience and expertise to achieve a position of leadership and authority. Then comes the nagging question: “Now what?” The question is often accompanied by a trigger: layoffs, acquisitions, career speed bumps, or just plain restlessness might just be the kick in the pants you need to strike out on your own. I recently spoke to three successful entrepreneurs, all of whom took the plunge. 

Andrea Fryrear (AgileSherpas), Donna LaVoie (LaVoie Health Science), and Stacia Nelson (Pivot Strategies) each hopped off the corporate treadmill to start their own business. While their paths are far from identical, they learned some lessons that could help you with your big leap into the unknown: 

1. Choose your customers wisely. You might be tempted to get your business where you can. But all three of these entrepreneurs emphasize the importance of knowing your sweet spot in terms of customers. Not coincidentally, they all have a preference for working with large enterprises—after all, that’s the world they came from. These big customers may be challenging to land, but they pay reliably and tend toward larger engagements, which can be more profitable. “We have discovered that it takes just as much overhead for a $10,000 deal as it does for a $500,000 deal,” Donna told me, “so we have set a project minimum, in most cases around $50,000.”
2. Know how you’ll be paid. Large customers pay, but they do so on their own terms, typically at least 30 days—and as much as 90 days—so it’s imperative to have a strategy for maintaining a positive cash flow. AgileSherpas requires a 50% deposit upon signing to get money into the coffers more quickly. Pivot Strategies maintains a line of credit just in case. LaVoie works on a monthly retainer due at the first of the month in addition to requiring deposits. All three highly recommend avoiding time-and-materials agreements in favor of project fees or retainers. That way, the more efficient you are, the more profitable you’ll be. 
3. “Act like a farmer and save for a rainy day.” Despite maintaining a line of credit, Stacia makes a point of saying she never has to use it, noting that she sets aside about 50% of revenue to fund growth and cover contingencies. Compared to outside capital investment, frugality pays off for owners big as they are the primary beneficiaries should the company be sold or go public.
4. Keep selling. If your corporate position didn’t involve business development, selling might be new to you. But if you’re not selling while you’re working, you’re likely to wind up with gaps when you’re generating no revenue at all. 
5. Set expectations in advance. Not only must you keep your company’s sales pipeline fully primed, but you should also build in ample ramp-up time for new customers or engagements. “During any sales conversations, we make it clear that we can’t start the next day,” Andrea says. “We tell all of our prospects we can start a minimum of 45 days from the day they sign on.” 

Want to know more about transforming yourself from corporate warrior to groundbreaking entrepreneur?  Watch my free video interview with Andrea, Donna, and Stacia by signing up for How I Did It, a free program from Birthing of Giants that provides step-by-step explainer videos from fast-growth entrepreneurs.