10 ways to build a safety net before starting a business
With the rosy outlook of the startup and investment ecosystem, the number of funds being established and easing of rules, it has become easier to start a business. However, it is a smart decision to build a safety net before you start your own venture. Following are 10 ways in which you can do so:
1. You do not need to quit your day job
When thinking about your idea, developing a business plan, researching the industry, talking with the community and learning about the whole process, it is not necessary for you to quit your day job. These learnings and developments can easily happen outside work hours. So stay put till you are at a point where you can start the business and get things rolling.
However, be aware of your contract terms to make sure the company cannot lay claim to your work outside office hours.
2. Join a startup to learn while earning
If you are unhappy in your current job and place of work, or it is highly demanding whereby you are not getting any time to work on your startup idea or plans, then by all means you can quit. At the same time, you can also join a startup to learn first-hand the challenges the founders face.
Be vigilant, pro-active and clear about expectations from the start. With slightly lower salaries that startups can afford, comes a wealth of knowledge and experience. Moreover, if you have enough experience and are a natural fit into the team, you will be welcomed.
3. Go freelance
This is the next step. When you see your startup needing more time investment from you, such as when building a tech platform, you can opt to freelance on projects to earn a side income while working on your idea's realisation.
4. Start consulting
It always pays to be on good terms with the companies you have worked for in the past. If you were at a higher managerial position or even just experienced and connected in the field, you could negotiate a consulting role whereby your hours would be reduced, but you would still be in the game.
You could also do this while your startup is up and running, so as to make an extra income while not losing touch. Staying connected in that aspect will make it easier for you to get back in as a full-time should your business venture not work out.
5. Take a sabbatical
This is a popular choice for employees as well as companies. Many conglomerates and even medium sized businesses have provisions to long-term employees to take a sabbatical for 3-6 months.
While it is unpaid, there is a strong safety net attached to this option. You can get to focus full-time on planning, researching and developing your company, while your employer is not making a loss from distracted work ethic, not giving the job your 100 percent, and unpaid leaves. Moreover, they benefit from keeping the door open for an experienced and talented asset.
6. Get a partner
The support, experience, expertise and connections of a good co-founder is the best safety net you can have. When their skills and knowledge complement yours to see the success of your startup, the probability of you doing well increases.
Furthermore, the can provide a significant moral and emotional support during difficult times. They can shed light on aspects that fall into your blind spot and share ideas and perspectives that can help you both grow. As they say, two minds are better than one.
7. Stay lean
You do not need to hire a bunch of people to get your startup off the ground. Work with only the essential people for your company and automate or outsource the rest. For example, the role of an HR or accountant can often be outsourced.
Plus, if you need to, you can hire interns to help you with certain aspects such as marketing. And if you really need, perhaps even a personal assistant to get tasks off your plate who can also support your core business.
8. Crowdfund your startup
Kickstarter and many other crowdfunding websites are a boon of the internet. Once you have your idea planned out and prototype ready, simply start a crowdfunding campaign. This will also give you a realistic idea of the market interest and if that is aligning with your expectations.
If you do not generate interest or are unable to meet your funding goals, you can go back to your drawing board and see how you can improve it. All the while, there hasn't been too much harm done.
9. Apply for grants and funds
The UAE and the Middle East in general have been launching multiple funds, grants and initiatives for accelerators and incubators whereby you can get the funding as well as the support and connections needed to put your idea into action.
10. Keep savings for the rainy day
Almost every dream needs some sort of sacrifice. While there is no need to be a miser, saving a bit more every month as a safety net will help you have the peace of mind as well as prevent bad business circumstances from affecting your ability to provide for yourself.
The freedom to fail can be a double edged sword that could relieve stress in difficult times and give one the confidence to make bold decisions that lead to success, but could also make some lethargic when troubles arise, not pushing them enough to do everything they can to fix situations. It really depends upon your personality and how you deal with stress. It is best if you build a safety net for yourself, but at the same time be more vigilant about your decisions and motivations, so they do not affect you negatively.