“I have an idea of an app that can make millions of dollars.”

“I am bored of my job, let me do a startup.”

“Let us start a company after college.”

“I have this insight that can help us create the next unicorn.”

These are common discussions among friends, college students, and corporate warriors alike.

Launching a company, and tackling a problem head-on – is a novel notion. I will not delve into the judgment of whether an idea is stellar or subpar, or how to distinguish the good ideas from the bad (frankly, I don’t think I have the expertise for that).

The crux lies in the critical decision every founder has to make: When to leave the day job and get into the startup full-time. It is a debate with distinct schools of thought:

1. The Full-time dive advocates: Leave that job and go all-in on your startup. If you are not investing your time and resources, how can you expect success? You have got to earn it.
2. The Job security advocates: Hold onto that job; you never know if the startup idea is the real deal. Why risk your stable job for an uncertain venture? Statistically, most startups do not make it.

Let us peel the layers and try to see what makes sense. It’s important to note that your circumstances might differ, and these insights may not perfectly align with your situation (apologies in advance).

A quick sneak peek: How do large companies work?

If you plan to start/run a company, it is crucial to take a page from the playbook of large corporations. After all, your vision should be to grow your startup into a large company making a real impact on the world.

Big shots like Amazon and Berkshire Hathaway do not close shop on existing business units when they launch new ones – they use the profits to fund new ventures. Google did not pull the plug on Gmail when they got into the Android game; they scaled up closing what already worked. This strategic approach is the very bedrock of success.

Moreover, major corporations incentivize and motivate their employees to work on new projects/areas but I rarely see these companies not allocating resources to existing projects/business units that continue to generate profits.

Your day job: Your startup’s silent investor

Let’s talk money. Your day job isn’t just a means to an end; it’s your startup’s silent investor. It funds your dream without needing to invest time in getting external investors(think bootstrapping).

My argument is not from a risk management lens but from a business 101 lens. While this principle is universal, it finds particular resonance in the non-tech business landscape. In these scenarios, individuals often don’t abandon their jobs to start a company; instead, they initiate and develop their business alongside their existing employment. Examples abound, from starting a rental business, Shopify store, e-commerce, and to crafting handmade goods.

Last I checked, large corporations also follow the same strategy. They use the profits from the existing business units and invest them in the new business units.

It’s essential to note that this perspective is particularly relevant to individual entrepreneurs, as opposed to venture-backed companies (as venture-backed companies have the financial resources)

You are the business, not your startup. You are a business in the making. Think of yourself as the CEO of “You, Inc.” and your startup as a strategic business unit.

Corporations do not close shop when they launch a new product, right? They leverage existing profits to fund the next big thing. Apply the same logic to your startup journey – keep the job, let the profits fuel your startup ambitions.

But I have a very hectic day job

I hear many people mention that they want to quit their jobs because of the busy nature of their current jobs and that their job is a distraction. Although it depends on the specific situation I generally disagree with that. If your day job is a tornado of chaos, why jump ship to build a startup? why not get a job that does not take all your hours? Consider exploring opportunities with a reduced workload or a slight pay cut. Also, if you can not squeeze in time for your startup in your current job, how are you going to ride the startup rollercoaster full-time? Success demands mad dedication, late nights, and relentless effort – whether you are hustling on the side or going all-in. Your day job is the gauge for your entrepreneurial backbone.

Looking at it from a pure business lens, companies will generally not enter a new line of business/start a new business unit unless their existing business units are stable.

Timeline: The most important variable

I am not advocating an eternal commitment to your current job. Imagine a startup founder raking in a billion dollars in revenue while still doing a full-time day job in a different company. Will that not be funny?

The crux is figuring out the opportune moment to bid adieu to the job and fully immerse yourself in the startup hustle. I get that it is highly contextual, but here are the key milestones to consider:

1. Idea Stage: Resist the urge to drop your job at the idea stage. Even when you are convinced to the core about the brilliance of your idea, hold onto that day job.
2. Team formation: When you get to the team formation stage, you should still not leave your day job. Communicate this clearly to the co-founders.
3. Minimum Viable Product (MVP): Building the MVP is a major milestone, but it doesn’t guarantee success. The temptation to quit your job at this juncture is strong but resist it.
4. Product-market fit: This will be the stage where you will see customers and/or revenue. You will note that your startup will need a lot more time at this stage. This is the time to start thinking of leaving your day job and transitioning into the startup full-time.
5. Revenue: When your commitment to the startup escalates significantly, and your revenue surpasses your day job’s earnings, or when the rate of revenue acceleration hits exponential levels, that is the cue to dive into your startup full-time. Also, if you get the venture backing then it makes sense to leave your day job and get into the startup.

Bottom Line: You are the business, your startup is just a ‘business unit‘ under you

To the code warriors, the business mavericks, and the college rebels – launching your startup does not mean burning bridges. It is about building a strong foundation in the startup world while keeping that day job. You should rewrite the rulebook, proving that building your empire on the side isn’t just smart; it is the hustler’s way.

Your startup journey does not have to start with a resignation letter or a college dropout story. It begins with a vision, a side hustle, and the savvy move of keeping that paycheck.

So, grab that paycheck, code on the weekends, build your business strategy on late-evening calls and show the world that the hustle never sleeps. Startup success starts now, one slick move at a time!

Disclaimer: https://vinaysachdeva.com/disclaimer/. The opinions expressed in the blog post are my own and do not reflect the view(s) of my employer. It is recommended that readers review their employment contracts and seek legal counsel to ensure compliance with all applicable laws.