5 Reasons to Start Your Business on the Side

On top of the logistics of starting a new business, there are decisions to make about how to work this new endeavor into your current situation. One option is to quit your job and sign a lease on that office space you’ve had your eye on.

But a more practical option is to keep your current source of income and devote your free time to your new idea, nurturing it and letting it grow at a more natural pace. Here are five reasons why starting your business as a side project can save you from potential anguish:

part time startup
photo credit: Kathy Ponce

1. You Can Generate Revenue for a Full Launch

Most entrepreneurs don’t have all of the capital they need when they start, and this can result in a lot of time spent finding investors – rather than moving forward with the company. The most important thing you should focus on in the early stages is progress. You have to keep moving forward, even if it’s on a smaller scale than you prefer. If you get a product or service on the market, you can start generating profits on a small scale so you can afford to take bigger steps forward in the future.

2. You Will Save Yourself from Emotional Turmoil

Many people are grossly underprepared for the emotional toll of starting a new business. It can drain your time, energy, and money, leaving less to devote to your family. I believe this is a major reason why 80 percent of new startups fail within five years. If you’re surprised by the emotional costs, they often lead to more visible problems that prevent a business from succeeding.

When you begin your new project alongside full-time employment, you still have to devote a lot of personal resources to the business, but there’s less stress involved. It’s better to start off working nights and weekends on something you really want to do than to lose your income while investing money in something risky. The time you have with your family will also be more enjoyable since it won’t be weighed down by unnecessary stress.

3. There is Less Financial Risk

Entrepreneurs can become accustomed to risk and not take it as seriously as they should. Taking note of the emotional strain involved in startups, it’s important to minimize the tangible financial risks. You may have less to lose if you’re young and single (and losing everything just means moving into your parents’ basement), but for people with spouses and especially kids, it’s unwise to put literally everything on the line. No success in business is worth failure at home.

4. You Will Have More Opportunity to Test Your Business Model

Nothing cuts down your risk like testing on a small scale. Chances are you’re starting a company because you have a new idea or product that you think is marketable. It’s also likely that you have an innovative business model that you’re confident in. But it’s best to test these new ideas before launching a full-scale endeavor. You want the freedom to make changes and adjust to the market early on when it’s simpler and easier to do.

5. You’ll Gain the Chance to Learn New Skills or Sharpen Old Ones before Relying on Them

This benefit of moonlighting will last even if your business doesn’t pan out. Ideally, you’re spending time creating an entirely new place where you and others will work as a primary career. But in the event that you end up working for someone else again, it’s good to spend time expanding your skill set.

This is also advantageous if you’re in a field where layoffs have become common. You may find yourself without a job sooner than you expect, so now is a great time to strengthen skills you’ll need when you launch.

Once you’re picking up momentum and generating some income from your side project, you’ll be much better prepared to make this your full-time job. You’ll have made adjustments where you need to, and you’ll know a lot more about how to make your business effective and successful. As an entrepreneur, your business is your baby, and making wise decisions in the early stages will help it grow into a full-fledged adult later.

About the Author: Steve Musick is the CEO of Destiny Capital, a financial advising firm he founded in 1977. In addition to wealth management, Steve is an author, speaker, and lecturer on the subject of entrepreneurial leadership. He recently launched Empowerium as an entrepreneurial platform to fuel business growth.