Ideas for Newbies from the Corporate World

When making the leap to your own small business, prepare family, stick to what you know—and think twice about quitting that day job

by Karen E. Klein

So you're stuck in the corporate work world and you're hoping to break out of the mold this year and start your own business. No doubt you've got myriad questions: Where do I start? What kind of business should I consider founding or buying? Should I go back to school? Where do I get the money to fund this venture? We asked a number of small-business consultants to share their best advice for corporate refugees longing to breathe free as entrepreneurs. What follows is a roundup of their e-mailed answers:

Before you even start thinking about what business to pursue, you may find that you need something more fundamental, particularly if you're currently in a management or executive position: an entrepreneurial attitude adjustment (see BusinessWeek.com, 10/30/06, "Is There a Gene for Business?"). "It's one thing to dream about running your own business, and something quite different to actually start a business and jump through hoops—and often not make much money—while the business is getting going," says Janet Attard, small-business consultant and founder of BusinessKnowHow.com. "That 'getting-going stage' often takes much longer than expected. Once you leave a position of power [in a corporation], you may not get calls returned as quickly as in the past. And the people that promised to 'help any time' may not have time at all to give you much assistance."

Phil Borden, a longtime Los Angeles entrepreneurial consultant, agrees. "Entrepreneurs have no place to hide. Everything they do is visible. The…ambition to succeed in an entrepreneurial venture comes with demands that are more personal and more threatening," he says. "Also, the job is more lonely, less social, and the circumstances of entrepreneurship are personally riskier and less protected on the downside." To get some insights into whether your personality fits the demands of entrepreneurship, check out some of the characteristics identified by the U.S. Small Business Administration at www.sba.gov/smallbusinessplanner/plan/getready/serv_sbplanner_plan_whatittake.html, or take a quiz prepared with the help of Gene Fairbrother, the leading small-business consultant for the National Association of the Self-Employed (see BusinessWeek.com, 1/16/06, "Are You Ready for Your Second Act?").

Build on Current Skills

Another personal area that's often fraught with emotional turmoil for corporate-types-turning-entrepreneurs is the support—or lack thereof—from friends and family. "While many [relatives and friends may] cheer your decision, they do not often understand it, especially family used to a certain lifestyle," Borden notes. "As time wears on, they may tend to get impatient and irritated." Attard agrees, and advises that you cement family support by having a realistic discussion about the demands entrepreneurship makes on finances and time before you decide to push ahead. "You don't want constant arguments or questions about when will you finally start making money," she says.

When you've decided to move forward, you'll have to figure out first what kind of business you want to pursue. Joe Kennedy, small-business consultant and author of The Small Business Owner's Manual, says stick to what you know. "Don't just look for a business that strikes your fancy somehow. The business area you get into should not be too far away from the work you're doing now, or maybe a personal passion or hobby you're involved with. Everything is so specialized today that if you get into an industry that's completely new to you, it will take several years before anyone—investors, vendors, or customers—will take you seriously," Kennedy says.