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You just finished college. Maybe it’s a four-year BBA from the Ross School of Business at the University of Michigan, or a Fashion Business Management degree from the Fashion Institute of Technology in New York.
No matter your degree or school, the big question is the same: What’s next?
Do you take the “safe” route of getting a job, gaining some experience, and then setting up shop? Or do you jump straight into entrepreneurship and build the business you’ve always dreamed of?
According to a report cited by Entrepreneur, 14% of students fully intend to jump into business immediately post-graduation, while 52% prefer to wait for some years of work experience before making the move.
But which path makes the most sense?
Read on as we discuss key points that should inform your choice.
Start a Business Right Away If:
1. You Have First-Mover Urgency
Do you have a unique business idea that even a few months’ delay could mean losing your edge? If yes, then by all means launch your business immediately.
This is especially true in fast-moving niches like technology, FMCG, or sustainable products, where being first is as important as being good.
That said, rushing in blindly can backfire. You’ve got to cover the essentials first.
- What are the licenses and permits you’ll need?
- Is your business plan strong enough to guide you?
- Is business insurance for sole proprietor ventures a requirement in your industry or state?
- How will you manage finances from day one?
These are boring tasks, yes, but they’re important ones. Take insurance, for example: LIFE143 points out that business mistakes can easily lead to personal disasters for sole proprietors if they lack proper cover.
Once you’ve got all these essentials locked down, move fast. If your idea is time-sensitive or based on new technology, an early move will put you ahead of the pack.
2. You Have a Financial Safety Net
One of the biggest challenges small business owners face is cash. Why? Because most businesses don’t turn a profit right away. In fact, experts agree that it takes between seven and ten years before a business can become truly successful.
Take Amazon, for example. It wasn’t until about ten years, from 1994 to 2003, that they could turn a full-year profit.
What does this mean for you? It means that if you’ve got a good business idea and you have significant savings, maybe a spouse with a steady income, or family support that lets you cover your living expenses for a reasonable length of time, then you’re good to go.
Having some form of financial cushion is vital if you’re looking at a full-time launch.
3. You Value Control and Flexibility
There’s something to be said about not having to answer to anyone, and if that’s the kind of person you are, going immediately into business is your best option.
You don’t even have to go the whole nine yards of renting space, buying equipment, and having a massive startup budget. You can go straight into being your own boss through freelancing, running a remote business, or an online store, whichever catches your fancy.
That restless energy that makes the 9-to-5 feel unbearable can be a powerful fuel for your small business success.
Get a Job First If:
1. You Need Financial Capital
Launching a business costs money. In fact, not enough of it can kill a business faster than anything else. Cash flow problems and financial challenges remain two of the top reasons businesses fail, according to the US Chamber of Commerce.
It’s therefore okay if you decide to get a job first and earn some money before venturing into the world of business ownership.
2. You Need Validation and Industry Insight
Here’s what not many people know: not every business idea is ready to roll on day one. Yes, you have a great concept, but that’s just you. Is there a ready market for what you want to offer? This lack of real market need is the reason why up to 28% of startups fail. You don’t want to be a part of that statistic.
Getting a job inside the industry you want to enter is probably the best market research you can do. You’ll have access to industry insights, insider knowledge, and the network you’ll need when you eventually launch out.
For example, if you are thinking of creating a B2B SaaS product for the logistics industry, a few years as a logistics manager will give you loads of insight into exactly what problems companies are willing to pay big money to solve. This is not something you can read up in a textbook.
3. You Want to Gain Real-World Experience
To run a successful business, you need more than just an idea and passion. There are skills without which you’ll likely flounder. Sadly, these skills are not learned in the four walls of a classroom, but out there in the real world.
A job, especially one with management or client-facing responsibilities, is a training ground. This is where you learn how to work in a team, manage deadlines, negotiate a contract, or present a quarterly report — all vital and all transferable skills that will make you a better business owner when you decide to take the plunge.
Doing Both Is an Option
As we wrap things up, it’s important to point out that your choice doesn’t have to be a binary one.
Many people are actually blending the two, working and running something on the side, and succeeding at it. In fact, it’s safe to say that probably the most common path to small business ownership is the side hustle.
You can keep your day job with its steady paycheck and build your business on nights and weekends.
*This article is based on personal suggestions and/or experiences and is for informational purposes only. This should not be used as professional advice. Please consult a professional where applicable.