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Go off on own?

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by ben

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I am going back and forth on the idea of going off on my own. Right know Im in sound "ok" job doing IT/IS work and been given lots and lots of chances of "Doing work on the side"
My question is, is this worth it. Is there a real market for this (Indenpent Consulting)?

Just thought I would get your ideas and thoughts.

Thanks
Ben

13 replies

by oldefar

There is no good time or bad time to go independent. It hinges on your abilities.

Some key considerations.
Capital - are you solvent enough to last 6 months with no revenue?
Insurance needs - if you are planning on kids, you need to know that it is near impossible to get a personal health policy that covers maternity any more. Maternity benefits are generally available only in group plans.
Marketing - do you have a market strategy for the services you will offer?
Sales - plan on spending at least 25% of your time crossed over to the Dark Side :)
Accounting - do you like doing paperwork? An independent has much the same needs as any business and no one to help unless he can pay them.

I suggest you contact your local ICCA and attend one or two meetings. Talk with these independents and get their input.

Good luck.

by oldefar

A good way to begin is to look at your income requirement - not income desire. Add your business costs for supplies, equipment, travel, associations, training, sales, and marketing. Put these in an 18 month spreadsheet. Add in an IRA or 401K contribution.

Figure on a increase of these expenses of 10 percent from month 1 to month 18 and adjust the figures accordingly.

Your working capital had better be at least equal to the last 6 month total or you will have cash flow issues.

Now look at revenue potentials. You want to hit your expense figure plus 18% to cover taxes (more in some areas). How many sales of what dollar value do you need to hit these numbers? If you are part-timing engagements with an average value of 10% of what your target is, you need 10 or more a month to survive. Is this realistic for you?

As for timing - a specific skill has a window of opportunity. However, a general approach should present a number of variable services with different windowsof opportunity. Also, every economy has certain boom requirements no matter how bad things look. Can you find and service these or are you a one trick pony?

by lordinfidel

If I was you, I would stick to the day job and still do consulting on the side.

One of the things I have found is while I could leave, the chances of me constantly setting up networks (which is where I make the big cash) is not endless. I would eventually have to have a very large client base on monthly support contracts in order to bring in what I am getting now.

At least staying where you are and doing consulting on the side you get the best of both worlds. Because the consulting gig is just extra cash. If you decide you don't want to support that client anymore, you don't have to worry about your next paycheck.

by ben

I understand what you are saying about keeping it on the side. However, If the side thing gets good and Im needing more time to do the side thing, instead of working my day job. Then that is were I run into a problem.
That is my current problem, Ido make a good living right now, while also working on the side however the side thing is getting more than I can handle if I only have time to do it on the side. If you know what I mean. Do I break off and try to take off on my own or just cut backon the side thing and keep it small?

Thanks for your comments and thoughts they really help

Ben

by info

Hey there!

Since you seem to be at a more advanced stage with your side business, you should have a history of monthly income from it, etc right? Is there something you can use to judge what kind of income you'd be able to expect?

Dependingon your confidence in yourself and how much you really want this to become a reality (which means doing all the required work as well), I see your choices as being one of two:

- Jump ship, and do it on your own. (high confidence, high interest, high drive)

- Drop down to part time in your job, and keep building your side business

Some bosses may get ornery if you ask to drop down to part time so you can pursue your own business endeavors more. Hopefully you don't have one of those jealous types.

Jill
www.metrex.net

by lordinfidel

I have more clients then I can handle and trying to juggle them all becomes a burden, where I just need more time.

But... Leaving your secure job does carry risks.

Remember how consultants make their money. By actually doing work. Let's you you build out a network and make 5k. But then they do not need you again for 6 months. Even if you have them on a support contract where you get paid a retainer every month. That small retainer will not pay the bills.

It's tempting to leave I know.

If I was you, before I really consider it, crunch the numbers.

Figure out how many clients you would need in order for you to make you current salary per week.

Do not forget about taxes, insurance, gas, cell phone etc. Where would youroffice be. At home, and if so do you have enough space there for computer equipment/spare parts?

I'm not saying don't leave. If you have 20-30 clients knocking down your door, then yeah, you may want to consider it.

But it's not all roses that you think it may be.

by madroxxx

Is going part time at your current position a possibility? This might allow you to expand the side work and let you know if you could make it all the way with "the side gig".

by john_wills

The Economist recently posed a conundrum. U.S. workers are more productive than European ones, and get paid accordingly, but still work a lot more hours, although they could with fewer hours live as well as Europeans. The answer The Economist suggested was that U.S. workers are greedier for the material products of others' work, like jumbo-screen TVs. But those who overwork themselves have less time to enjoy their jumbo-screen TVs, or even their books and CDs. They are also more likely to have health problems. Be patient - eventually you can save up for the fancy gadgets if you really want them - and content. http://www.oremus.org/hymnal/h/h047.html

by lordinfidel

I just have a hard time saying no.

I don't look for clients. Word of mouth is a powerful thing, and the:" I have a friend who needs help, can you help them out" is a hard thing to say no to.

Also doing outside consultant work let's me do other things then what I would do on my own network. And I get to keep my skills fresh.

Reastically, how many times do you really vpn 2 or more networks together. I know in my job it does not happen very often. Once we created the vpn, there is no need for us to dismantle and recreate it.

by oldefar

I have seen a number of employment agreements where doing the outside work is either prohibited or requires management approval.

The issue often relates to non compete clauses and non disclosure agreements. It especially prevalent with corporations that provide IT services since the company being helped part time by the worker may be a potential client.

Make sure you aren't exposing yourself to termination with the part time work.

by mallardtooxx

One thing to bear in mind: With Personal Business Freedom comes major headaches. The previous posts delve into that, crunching numbers, making ends meet, building a clientel, all of the fun stuff. But there is also the home principle, if you are going to make it with the side business becoming a primary business then you will be turning in 15-20 hour days at first. If you have a wife/kids that can become very stressful. If you are single then I would say go for it!!! you only live once. But if you have to support a family weigh the odds because your family should always come first.

by oldefar

The 15-20 hour days can happen, but it depends on how you approach the business and the goods or services you deal in.

Keep in mind that much of the mundane can be outsourced if you choose - accounting (including invoice and account receivables),payroll (if you set up this way vs. sole proprieter), marketing (delivery of), sales. You can get it to where you do only the technical aspects.

Remaining as an employee insures you won't face any death marches, will always get paid for the extra work you do, and will be able to count on paydays provided you do your work well. Right. Gotta go leave cookies for Santa Claus now.

by ben

Thank you for all your guys input, It really helps me out.
To the question of going part-time yes I can do that if I choose also without having to worry about non-discloloser stuff.
But you guys did basically state what Im thinking about, building the clientel and getting off my feet. I agree that word of mouth is the best source for clients but sometimes that needs pushing. I guess it all comes down to numbers and how many billable hours per week I would need to equal my income now.

Thanks again for all your input.

Ben

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