IT Employment

The most terrifying way to earn more money

Striking out on your own can be a terrible proposition. But Greg Miliates, who's been there himself, offers some tips for overcoming those fears and making it work.
Before I get started, I just want to mention that there are actually lots of terrifying ways to earn more money, like:
  • being an arms dealer,
  • creating a meth empire in your town,
  • being a drug mule for a Mexican cartel, or
  • being a clown at children's birthday parties

But for the moment, I'm going to focus on confronting your fears and turning your tech skills into a business. If you're so inclined, you can tackle those other terrifying ways to make more money; facing your inner fears is a big enough challenge for most of us (though you won't catch me in floppy shoes and a rainbow wig singing to kindergarteners anytime soon).

We all want to earn more money, but as an employee, it can be scary to think about using your tech skills to create a business--even though you know your skills are marketable. Starting a business is daunting, and riddled with anxiety and the fear of failing. I've seen lots of people--myself included--who didn't know where to start, thought that starting a business was something that only "other people" could do, were afraid to fail, or were afraid they'd lose money and time on a failed business. (We've all heard horror stories about people who lost their life savings on a failed business.) The result is that even if you want to turn your tech skills into a business, those fears can paralyze you.

But the fact is, those fears are either false or blown way out of proportion. Even so, it's hard to shake them off. But there are specific strategies and tactics you can use to beat those fears, and start down the road to using your tech skills in your own business. The benefit is that by beating your fears, you'll change your worldview, and see that you're capable of much more than you thought.

Why fear paralyzes us

The most common fears are about turning your tech skills into a business are related to:

  • failing
  • not being perfect
  • not knowing where to start
  • being rejected
  • losing money or time
  • looking foolish

But those fears are either blown out of proportion or not based in reality. For example,

  • Would you really be a failure as a human being if you tried starting a business and it didn't succeed?
  • Does something really need to be perfect for it to work? How many businesses and products aren't perfect but are still successful? Every successful business is imperfect. Think of all the software bugs and marketing gaffes from Microsoft, Apple, or any company.
  • Is there only one right way to start something? Or are there many paths to success?
  • If someone doesn't need what you're selling, does that really mean you're a worthless human being?
  • Are you really guaranteed to lose money and time by trying to start a business? Do you really need to burn through your life savings and years of your life to start a business?
  • Will you really be a fool for trying to start a business? Will you actually be publicly ridiculed for your efforts?

So, even though you can see how your fears are unrealistic, they still have a strong hold on you and are hard to rationalize away. That gut feeling is what keeps us from acting in the face of fear. The brain may say, "Let's give it a shot" but the gut is screaming, "Get me out of here!" You can't reason with a rabid dog.

How taking small actions dispels your fears

We're not going to do therapy here, but the ideas behind the tactics below are based in cognitive-behavioral therapy, which has decades of demonstrated success in eliminating fears, anxieties, and phobias. For the moment, just know that you can work both sides of the street (change your behavior or change your thinking) to get past your fears. We'll do a little of both.

How to take action

The first step is to take action--small actions--that move you forward and give you a taste of success. Those tiny actions are the keys to beating your fears, since those actions will start changing your mindset.

Here are a few things you can do to start breaking down those unfounded fears: Do something every single day to move you toward your goal, and write it down in a journal. That way, you'll see your progress over time, and can see that even seemingly small actions will snowball to create big wins. The more actions you take, the more you convince yourself that you can succeed. Cultivate an experimentation mindset.This is one of the most important things you can do to demolish your fears. Remember:There is no failure--only learning. When you have an attitude of trying things out quickly and cheaply, the risk is very low, but the rewards are huge. You'll learn a ton about what works and what doesn't, but more important, you'll see that you don't have to take huge, life-crippling risks to start a business. If you've heard of the Lean Startup model, this is essentially what you'll be doing. Try things out--quickly and cheaply--and iterate based on what you learn. For example, if you think there might be a market for your PHP skills, DON'T waste hours and get discouraged making a bunch of cold calls to prospective clients only to get shot down; instead, surf around on sites like ODesk or Guru to see if people are paying for those skills. That'd take less than five minutes, and will validate that, yes, there are plenty of people willing to pay for PHP skills. (Yes, there's a big market that treats tech skills as a commodity and drives the price down, but putting yourself in a small, profitable niche lets you charge a huge premium--and have less competition). The point is to try things out, learn, and move forward based on what you've learned. Train yourself to look for problems.What are the biggest pain points you can solve? Don't limit this to just looking for problems where you work. Look for problems all around you. Does that restaurant down the street have great food but lousy service? That problem is an opportunity. Can't figure out something interesting to do in your town? That's an opportunity. You don't have to pursue all the opportunities you see; the point is to begin looking at the world through an entrepreneurial lens. People will pay generously to have their problems go away, and seeing problems as opportunities is one step toward getting rid of your fears and realizing how many opportunities there are. Become a strategic complainer. Maybe you hate your day job and want to ditch it. Use that negative energy to fuel your start-up motivation. Be careful about this though, because no one likes being around a complainer. The point here is to make your current job so unattractive that you'll be more afraid to stay there compared to starting a freelance/consulting business. Reframe the risks. Reframing your situation can do wonders for switching your mindset. For example, what would you lose out on by staying at your current job for the next five, ten, or 20 years? By comparison, trying a few small experiments and earning some cash from some part-time consulting gigs seems really low-risk. Look for specific ways you can increase revenue or decrease costs.This is a bit more specific than just looking for problems and re-framing them as opportunities. Remember: entrepreneurs create value, and typically, that value is either an increase in revenue or a decrease in costs. You don't even need to act on your ideas--yet. The point is to jot them down; that way, you'll realize how many opportunities there are even in your little slice of the world. Don't limit yourself to thinking about how to increase revenue/decrease costs at your job/company. ALL businesses--and people--can benefit from having more cash and/or lower expenses. Many businesses have big expenses that could be easily reduced using current technology. As tech workers, we're more likely to be in the know about cost-saving tools and services, and that knowledge makes it easy for us to provide value by cutting costs. The examples below could easily be implemented at most small and mid-sized businesses, but could also apply to larger businesses. For example:
  • Could the business switch from physical to virtual servers?
  • For phone service, instead of sticking with traditional phone companies and landlines, could they switch to VOIP and a service like Skype, Google Voice, or RingCentral?
  • Can they ditch their fax machines (and dedicated landline for their fax), and use an online faxing service?
  • Could they reduce postage by faxing and sharing documents in the cloud?
  • Could they eliminate courier costs by using a document e-signing service like EchoSign?
  • Could on-site tech support be provided remotely using tools like GoToMeeting or LogMeIn?
  • Maybe the company doesn't need a huge, complicated project management system, and could instead use a system like Basecamp to simplify project management for a much lower cost.
Start small, and part-time (do NOT quit your job--yet). Even if you have a huge consulting client waiting to pay you a pile of cash, try to start your business part-time. That huge client may flake out, and you want to make sure you can still pay your bills. Use your day job to fund your business. Focus on getting your first client, and making that client so happy that they'll be delighted to refer you to others. Then get your second client, and keep growing. When I started my consulting business, I worked full-time (along with being married and having two kids), and did the consulting on the side. At the point where my day job got in the way of how much I could earn consulting--and since my consulting income was relatively steady--I downsized my day job to part-time, ramped up my consulting workload and client base, then quit my day job completely. I'm pretty risk-averse, but ditching my day job for full-time self-employment didn't seem risky--it was a no-brainer, since I'd established a track record over the prior months for how much I could consistently earn consulting.

It's not so terrifying anymore. So what's next?

For many IT professionals, starting a consulting or freelance business is typically much easier than they originally thought, ends up creating a tidy side income, and can even grow into a full-time job. You already have the marketable tech skills, but getting past those initial fears is the price of admission to creating a profitable business--and ultimately changing your life.

And who knows? One day, you may find yourself with a red plastic nose, doing your plate-spinning act, and singing Happy Birthday. And no matter what anyone else says, it's a better gig than walking across the border with your underwear full of cocaine.

Greg Miliates started his consulting business in 2007, quadrupled his salary, and ditched his day job along the way. His blog (StartMyConsultingBusiness.com) gives specific strategies, tactics, and tools for creating a successful consulting business on the cheap.

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About

Greg Miliates started his consulting business in 2007 and quadrupled his former day-job salary. His blog (www.StartMyConsultingBusiness.com) gives specific tips, tricks, techniques, and tools for starting and running a successful consulting business ...

21 comments
daveinboise
daveinboise

Other great tools for project management than Basecamp, is Trello or Acunote if you follow the agile/scrum methodologies in your organization. The point of the article is correct though, there are a lot of great tools available and new way to do things that will help cut your operating costs and improve the value of your offering. This article is a keeper, thanks for writing it Greg.

Greg Miliates
Greg Miliates

I've noticed a few comments from people who actually did overcome their fears to start a business, but struggled to be profitable. From talking to many consultants/freelanceres, the biggest causes for struggling with your business profitability are: --not charging enough --not creating marketing pipelines, thus struggling to get consistent work To be able to charge more, you'll typically need to be in a more specialized niche. For example, doctors who have a specialty--gastroenterologists, for example--are able to charge a lot more than a general practitioner. The key is knowing how to research and identify a profitable niche. A couple other benefits of being in a specialized niche are that it's easier to stand out, you'll have less competition, and clients often come to you instead of you having to market to them. To create marketing pipelines, you'll need to identify where your prospective clients are, and create a presence in those channels, establishing yourself as an expert who can solve their problems. The wonderful thing about marketing pipelines is that they automate your marketing, so you no longer have to spend as much effort on it. I haven't made a cold call in probably 2 years; instead, new prospects seek me out, and I follow up on warm leads who already know that I'm an expert. It makes it a ton easier to maintain a consistent and growing workload--that's how I've been able to consistently grow my revenue by over 30% annually over the past 5 years--even during the global economic meltdown--and actually work LESS than I did at my day job.

cmaritz
cmaritz

I co-ran a small training/consulting business some years ago. Didn't really make a lot of money, but during those years I learned stuff a) that I doubt I would have learnt otherwise, and b) at a speed which I doubt I would have learnt otherwise. The mind, left uncontrolled, tends to feed itself and build up things to silly proportions, especially fears. "... by beating your fears, youÂ’ll change your worldview ..." I second the hell out of that.

cmaritz
cmaritz

Paraphrased somewhat, but he said something like ... "There are lots of ways to get rich. You can get rich by being cheap, but the problem is, you're cheap. You can get rich by being a crook, but the problem is, it's a dangerous line of work and you could lose your friends or your life in the process. You can get rich by marrying someone rich, but the problem is, we all know what that makes you." Etc.

vijaynats
vijaynats

I got rid of all my debts, cleared my cc balances, cut down my expenses, half the fear is gone! Next i quit my regular job, became a consultant instead (earned more than regular employment), started exploring the market and now have good biz coming from consulting, training and manpower. All i needed was some working capital to stay afloat after quitting regular employment, which i made as a consultant. Fear comes from lack of backup (working capital), so plan on saving some backup money by getting rid of all debt and doing some consulting/freelancing on the side. If you had a 100 Grand, wouldn't you try taking a 1-2 year break ? And surely there would be a lot less or even lack of fear! So first step is to get that backup cash! Then you can take a break and have time to think over things clearly for your business! It worked for me and should work for others too!

dba88
dba88

It is a scary thing to do, but I took the step and I've been doing it for a bit over twelve years. My reasons were different. I'm not an advocate of "at will" employment doctrine, not having any choices / decision making abilities, being dependent on a company for a paycheck and benefits and they hold it over your head as a tactical tool, performance reviews without them being reviewed, politics, chemistries, personalities, cultural fitting, etc. In general, don't particularly like authority figures and prefer to manage rather than being managed. To many, I sound a little bitter and angry. Yes, I was. I didn't like the way some (not all... some) businesses treat people. As a consultant, I see the ugly underside of business and the way they treat their employees. Some employees are so scared, they can't even get up in the morning to go to work. It's not a pretty thing to witness. But that's me. That was my motivation. Yours may be similar or different, but either way, you need to decide to take the chance. The toughest part is between projects. It is hard to sell while you're on a project. No matter how proactive you are, market forces and economic conditions dictate closure velocity (IOW getting another project). Has it been satisfying to me? There are a few painful aspects about it, but once you settle into it, then overall, absolutely!!

mjd420nova
mjd420nova

While working for a large corporate service company, I built a reputation with my clients as a person who got things done and met the clients expectations. Now that I have etired, I still have a core group who still rely on me. They could use their companies service provider but want me to do the work. I enjoy it more now as I can accept the work I like and make my own appointments. Too many companies have no real connection with those who pay the bills or earn those incomes that allow them to prosper. In an industry where someone acually has to lay hands on the offending hardware in order to affect a repair, a hand shake and a promise goes a long way to insure both yours and the clients concerns can be put to rest.

AnsuGisalas
AnsuGisalas

Sometimes when a problem seems like it's nothing you've ever seen before, you can really start to feel like an impostor. But, while it's always a good idea to make sure that you're not overlooking something basic, like a tool for the job that you just haven't heard about, it sometimes really means that it's a novel problem, one that doesn't have a tool yet. So, sometimes you're not being an impostor, you're breaking new ground. And sometimes, the way you "fake it" is really the best new way to do it. So, do your homework, but don't be afraid to have a go, either.

jbwillis01
jbwillis01

Empowering article and I love to see it. Guys and gals, get off your social anxietal butt and make things happen! Having started a tech business and failed and then starting another and succeeding, trust me - the failure is worth the success!! There is little more rewarding than running your own business and making it successful and you have far more tools at your disposal than you think to make this happen. If you have the desire - conquer the fears and do it! Start thinking about it today how you will have your own business in 6 months or a year from today. Just think about how things work. Don't worry about the technology so much or its 'perfection', but how you envision your business. What it looks like. How it runs. What kind of culture you want to provide. How you will change the lives of those who work with you. Just start thinking. Make it happen! ~ Josh P.S. Remember to hire the people with the skills that you don't have. For me, it was marketing (finding new clients). Found someone who needed a tech guy to do the behind the scenes work and help with the sales side - which is what I am good at. Compliment each other. Know your strengths and weaknesses - be honest with yourself for both the positives and negatives (concentrate on your positives!).

barts185
barts185

I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain.

Greg Miliates
Greg Miliates

I advocate starting your business part-time, and using your day-job to fund your business along the way. Quitting your full-time job to start a business is typically a recipe for disaster, since you'll be stressed and desperate to get work, and nothing turns off prospects like the smell of desperation. Also, if you're desperate, you'll sabotage yourself by doing things like lowering your rate, taking on difficult clients, etc. However, starting your business part-time lets you learn the ropes and experiment to see what works best for marketing, selling, pricing, etc. That's how I built my consulting business; within about 15 months, I went part-time at my day job, then ramped up my consulting workload & marketing, and a few months later, quit my day job completely to consult full-time. The decision to ditch my day job wasn't risky at all, since my consulting income had been reliable and consistently growing over several months, I was earning money from multiple clients, and I saw that my day job limited how much I could earn consulting. I'm pretty risk-averse and this was my first business, but this approach let me learn how to run my business and grow it to the point where it no longer made sense to stay in my day job. Of course, my wife had to nudge me to go part-time and then quit my day job, but it's been hands-down the best career decision I've made.

AnsuGisalas
AnsuGisalas

get a thousand grand and skip the whole "work" phase...

Greg Miliates
Greg Miliates

Glad you liked my article. Starting my business was hands-down the best career decision I ever made, and like you mentioned, it's an incredibly empowering experience--especially seeing your efforts bring concrete results every day. The biggest hurdle I see is fear. But when we start taking even tiny steps, it's easy to see that those fears were unfounded.

CharlieSpencer
CharlieSpencer

"Fear is the path to the dark side. Fear leads to anger. Anger leads to hate. Hate leads to suffering!" In my case, it's not fear. I lack strategic vision and the people skills to drum up business. I work better when directed; I'm a tool, not a craftsman. Yeah, yeah; get the jokes out of your system. Feel better now?

JJMach
JJMach

It is by caffeine alone that I set my mind in motion. It is by the cup of java (Dew of the Mountain) that thoughts acquire speed, the hands acquire shakes, the shakes serve as a warning. It is by caffeine alone that I set my mind in motion. (He types, sipping on his Peet's Anniversary Blend.)

AnsuGisalas
AnsuGisalas

I didn't make that connection until I re-read it and noticed the "...my article". I had been wondering because nicks like "StartMyConsultingBusiness" set off my Spammer detector :^0 Now I can stop waiting for the payloads to drop :D

AnsuGisalas
AnsuGisalas

starting a business doesn't always mean running a one-man show. Some great successes start with a Mover and a Doer. Every spark needs a minion, eh?

AnsuGisalas
AnsuGisalas

In my line of work there are very few desk positions, everybody's a freelancer. - Except the bureaus have all figured out that it's a horrible mess to deal with freelancers across borders (and translators are likely to be an international bunch), so every freelancer has to be a company: Selling and buying services over the border is much much simpler than hiring over the border. So I have to deal with all kinds of red tape, which makes my spine crawl. So I definitely get your point. Just can't choose, meself.

tbmay
tbmay

Threw in the towel and went back to a "normal" job. Now I timed it terribly. Went full time just a couple of months before the big financial meltdown; however, it's tough to run your own business even during good times. I certainly lacked the salesmanship you mention, and believe me, it's a real good idea to "know thyself." Wish I would have known sooner. The fact of the matter is it's a LOT of work and, in my case, the easy work was actually the tech work. Dealing with people in terms of things like sales, collections, managing expectations....that can be so far out in left field with some business owners and managers you can scarcely believe you're even having the conversations....was the hard part, and the part that consumed the most time. Most "geeks" do not have the right skills to make this work. I probably do better with people than many "geeks" do, and I found out I don't really have them. I'm not trying to rain on anybody's parade, but this is not a decision that needs to be made lightly, regardless of the words of motivational speakers and success stories.

CharlieSpencer
CharlieSpencer

I don't want the pressure. I like not thinking about work after I leave the plant (most days, anyway). I like going on vacation, something most new business owners won't be able to do for 18 to 24 months. I have sister with her own landscaping business. She and her partner have been at it for a couple of decades, with an unsuccessful false start or two in the early years. One of them works more with the customers, the other more with the work crews. Either way, it looks like way too much work for me. Good article, but there are people who just aren't wired to run their own shop. The failures often occur when they don't know it.

Greg Miliates
Greg Miliates

Excellent point. There are plenty of ways to acquire the expertise you don't have (get a partner, hire someone, use an intern, etc.) to grow your business. It's important to identify assumptions that limit your options or stop you cold. Thinking you can't do something is limiting; thinking "HOW can I solve this particular problem?" gets your mind to shift gears and instead generate solutions. BTW, I love that Yoda quote--very apt.

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