• Zoe

7 things to think about before you take your side-project full time

Updated: Jul 13, 2018

Yesterday I resigned from my job so that I can focus on But the Books. In part it was the easiest decision I've ever made, I've known that I needed to do it for a long time, but as a hugely cautious person, it's also one of the bravest decisions I've ever made ...and I've jumped out of a plane. Leaving the security of my monthly pay cheque to do my own thing is huge, but if you have a side-project you know just how much of a balancing act having a job, a life and a family can be and there does come a point when you have to decide whether you're going to go for it or not. This weekend was my time to make that decision.

I haven't just blindly handed in my notice though, in deciding what to do I've given a lot of thought to the business, its viability and its finances, as well as my own personal finances. There was a lot I needed to bear in mind, and I know that the decision for everyone will be different and subject to your own personal circumstances and views so please don't consider any of this post to be advice, but here are seven of the questions I asked myself before I decided to take the leap.

1. Is this really a business?

A long time ago, I had a little craft "business". I made handbags and earrings and pretty hairbands and I loved buying craft materials and turning them into things I could "sell". I'd spend whole weekends making things, I'd haul my goods down to craft fairs all over the place, pay £10 for my stall, and maybe sell something for £20 all day. It wasn't a business, the stalls next to me which sold out of the cakes they had for sale within two hours flat every time were businesses. What I had was a very expensive and time consuming hobby. It's fair to say that craft wasn't my calling, but bookkeeping possibly is. I know my figures, I know how much I'm selling each month, what my costs are, and what my profits are. Being realistic about your business is so important in deciding whether it could ever support you.

2. How much can my business afford to pay me now?

Having done my sums, I have a good idea of how much the business can afford to pay me every month. I know how much the business has in the bank in case there's a quieter month, and I know how much the business needs to sell every month to cover its expenses and then to pay me.

3. Can the business grow?

I've build But the Books up by working in the business just one day per week (plus stolen time in the evenings and at weekends) so the amount I think the business can pay me based on the numbers right now, is less than when I'm focused on the business full time. I know that my business can be scaled, there are more potential clients out there should they wish to work with me, and with more days I can do more work, and there's always the option of taking on staff to help me take on even more work if I find myself in that fortunate position one day in the future.

4. Can I afford it?

Of course initially I'm going to be earning less in my business than I would be in my well paid job so in the meantime I've needed to look at how much I need to contribute to the family finances to see whether a combination of what the business can pay me and my personal savings will be enough. If the business couldn't pay me enough or my personal finances were a problem, I almost certainly wouldn't be taking the business ahead at this point.

5. What are my goals?

It's easy to make assumptions that the business will just grow, so it's important to set goals about what that growth will look like and how to get there. I've looked at my current sales figures and what I'd like to reach in the next three, six and 12 months. I've broken that down into smaller targets based around the number of clients I have at any one time, the number of other jobs I need to be doing each month and how that will work with the time I have available.

Goal setting can feel scary but it's important to know where you're heading so that you can do the things you need to do to get there, it also helps you identify when things aren't quite going to plan so you can get back on track or work out what you need to change.

6. What's my time frame?

All businesses have their ups and downs and it can be tempting to try to stick it out when things don't work out initially, but at what point do you call it a day? It's important to have a make or break point in the diary, and regular targets and review points will help you keep on track and ensure you don't get swept away with the business, just hoping it will take off. I have a 12 month window to make But the Books a success.

7. What's my escape plan?

And if the business fails, what will you do? As an accountant with 15 years of experience working for large organisations, I hope that it would be fairly easy for me to find a new accounting role if I need one. If things aren't working out in 12 months time, this is my escape plan. Sure, I'd be disappointed, but I'd know I'd given my business everything. Today somebody told me they'd once had the opportunity to go freelance, they hadn't taken it and had always regretted it. I don't ever want to find myself telling that story.

If you'd like to talk to me about how I can help you with your bookkeeping, please get in touch, I'd love to hear from you.

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