I had just had my meeting with my career reorientation advisor, the last step in my termination package (M&A). I told him how and why I was launching my small business. We spoke for an hour about it. Being a former business owner himself, he shared the perils of moving in that direction, questioned me a bit more about my motives and wished me luck.
Despite all known risks, this business was my ticket to freedom. Or was it?
A few years after launching my small business, I realized that leaving the corporate world to start my small business brings many paradoxes. Here are three to think about:
Paradox #1: You want to work without a pesky boss BUT you’ll have to be one.
My contribution as a team leader was very good but I would often challenge bosses for all kinds of reasons. Changes were not fast enough and status quo was sometimes paramount. Owning my small business meant I could make my own rules, set my own pace and do it all without a boss.
There is a paradox right there: You don’t want a pesky boss but you’ll eventually have to be one. You will have to stall on certain initiatives proposed by your team or even interrupt daily business because of some emergency. You want to be that cool boss you’ve dreamed about (Hey, you own the place, you can do that right?), but business imperatives and even your own idiosyncrasies will get in the way at times.
Paradox #2: You want total control over your business outcome BUT you’ll have to let go to let it grow.
Running your small business also is the promised land of control. You decide, execute and enjoy the rewards. No more boss, or boss’s boss canceling a project you cherish. You want total control and expect all the benefits. You will start with all of it while in the planning stage. Then things get busy and you need to hire and deal with growing pains. Then you hire a manager to handle the day-to-day while you work on the next cool thing. You were looking for total control and now are overwhelmed by everything you have to handle.
Yep, that’s another paradox: If you want to let your business grow, you have to let go of its total control. Trust your team members and systems. If you keep a tight leash, your business will remain small.
Paradox #3: You want to increase salaries BUT you’ll have to self-sacrifice at times money wise.
Yearly salary increases came in like clockwork in a corporate world company. Unless you change positions or levels, the average increase can be pretty steady. Your opportunity for income growth can be narrowing as you climb the corporate ladder and becomes much more competitive. The dream of creating your own business, working hard and smart for yourself in order to get the proportional income is often heard with wantrepreneurs. Some new entrepreneurs and small business owners fall in the trap of “stretching” their company’s budget to enjoy the perks of business ownership. Sometimes, sales are through the roof and profits pour in. Your income (yes, business owners often confuse their business income with their personal income) increases dramatically.
Unless you are some whiz kid, through the years you will face droughts (in sales, margin, or both). Another paradox: In your own business, you can set your price BUT you may at times have to actually forego your salary because of a cash crunch. Even in strong growth, you may need more cash then expected to pay for all that inventory.
When I finished my meeting with the career advisor, I detected his experienced skepticism. The reasons why I was leaving the corporate world and the expected rewards with my business were a tad naive: Not having to work for a boss, having total control and getting bigger raises over time. I found out quickly that these ideas weren’t exactly perfect. A small business’s survival implies an acceptance of establishing a good structure: Actively being a great boss while trusting your team with their responsibilities. Personal income follows your business success so you have an influence in your raises, however, cash crunches can occur, even in growth, and thus affect your salary the other way.
Ten years later, I am very happy I made the move, despite the advisors skepticism. However, I have come to smile at my naiveté back then. The reason we want to become a small business owner can be very paradoxical. 🙂
What are your reasons for wanting to become a small business owner?