I was on Reddit the other day and I saw this question come up and thought I would share my answer here:
The question was:
“I have a relatively easy job that pays $84,000/ year after tax, with good travel opportunities. The only downsides being that it’s boring and in a bad area.
I could easily continue to do this easy job and get by no problem. In fact, I would be able to save a lot of money over the decades.
However, I feel like doing so would be settling. I have this natural desire to create something and own something, and really get deep into what it is that I’m doing, which my current job doesn’t really allow.
What would you do?”
A great question and the following was my response:
20 years ago I was 28 years old and hated who I was working for at a job I was getting paid $50,000 a year to do. I had a one-year-old son at home, was in the middle of a home remodel and was the sole provider for my pregnant wife and our son. Certainly, the worst possible time to start a business.
So I did it!
I had no education, no business training, and no money. That was 20 years ago, and if I had to do it all over again? I would do it again tomorrow. It was the hardest thing I ever did, and the most rewarding. The risks were massive, as I took out equity loans on my house three times in the first eight years to keep the business afloat. But it has changed my life in a way that will impact future generations. Coming from a dirt-poor background with a family legacy of being poor, my success has allowed me to change that reality not only for myself but also my children.
But it is a hard way to go.
I didn’t get a paycheck for the first six months, and I supplemented my income for the first two years by working on the business from 6 AM to 6 PM and then refereeing basketball games from 7:00 PM until midnight. The challenges are massive, the learning curve steep, but I wouldn’t change a thing. Over the last 20 years, I have owned 12 businesses that have generated over $400 million in revenue, and I have had experiences and learned lessons the hard way…by earning them!
So here is what I would tell you about starting a business:
• I can guarantee you that there is never a good time to do it, you just have to get started. I don’t believe that there is an easy way, i.e., setting aside two years of living expenses or making sure other parts of your life are in order. That is because it is the risk that mainly drives you to be successful. Yes, you want to try and minimize the risk as much as you can, but you cannot reduce the impact having that risk, be it mouths to feed at home or merely self-preservation, has on you.
• You will never get over the thoughts of possible failure or that you might regret what you have done. However, and this is a mistake I think lots of fledgeling business owners make, you cannot let the downside control all of the decision-making. Because if that were the case, then none of us would ever go out and start anything.
• Starting a business from scratch is in my estimation high on the list of the hardest things to do in life. It will be the hardest decision you will ever make, while simultaneously having the possibility of being the most significant opportunity missed. You just never know. And all the planning in the world won’t change that. Again, I’m not saying that you don’t do your homework. Just don’t let it freeze your decision making.
• Particularly important I think is finding someone to give you advice, someone who has been there before and has done what you’re attempting to do. For me, that meant joining a CEO group right after I started, and my group was made up of CEOs of other businesses that were on average 10 to 15 years older than me. We would meet once a month and talk about each other’s business and primarily function as a sounding board for ideas or issues or problems. In my first year, I probably did not say 20 words as I sat and soaked up as much information about how business works from these men who had done it before me. That education was invaluable, and some of the best money I ever spent was in that group.To this day I still belong to that group. And now I am the guy that has all of the experience and can pass that along.
• I also realized that although I sat for the first year and mainly listened, I was also providing something to the older guys. Because when I have the opportunity to help new business owners in the same way, it reminds me of what I went through building my own companies over the first eight years. All of those lessons that I had learned are reinforced as I pass the knowledge along to others. I did not realize at the time that they were getting as much from me as I was from them! So finding a specific person or a group to give you advice will provide you with a significant advantage over going it alone.
• I should also say that I love the competition, and the competition of business is fierce. I also love the “business” of business. I devour every magazine on a monthly basis regarding stories of business as well as read as much as I can click on via the internet. It is where I learned how business worked.
Let me ask you a couple of questions:
• Are you ready to work 15 hours a day for six days a week on average?
Because when you own a business you have to outwork everyone that you are competing with. It’s not about who the smartest is, it is about who’s willing to put in the time and do the work. I have worked 15 hours a day, six days a week for 20 years and have mostly loved every minute of it. If you are not, just be aware that there are people like me out here that live to outwork and outhustle everyone else.
• Are you a Gladiator?
That work ethic and mindset is half the battle. I refuse to be beaten and will do everything in my power not to be. But if I am beaten, I have to stay humble so that I can learn the lessons for the next time. Having a big ego while also staying humble is a brutal combination to have to compete with.
• Are you able to handle the isolation and loneliness that comes with being a business owner?
If you are someone that needs to hear others tell you that you are doing a good job or needs a pat on the back, this is not what you want to do. Being a business owner is a lonely position at times, mainly when those times are bad. I am a supremely confident person by nature and am not one that needs to hear “good job” from others.
• How are you emotionally?
Business will throw you curveballs that you cannot imagine, and there is no money to be made in getting excited. You will get your heart broken, can you handle that while continuing to push forward?
I never get too high or too low, and that allows me to make informed and lucid decisions in every scenario while also communicating effectively with my managers and employees.
• Do you care what people think of you?
If this is you, do not go into business for yourself. One of my best qualities when it comes to operating a business is that I legitimately do not care what anyone thinks. If you do, it will be that much more difficult for you to make decisions or not feel the pressure from them. Outside influences from family, friends or employees are deadly, even when they are well intended.
• If you have a family at home, are they a stable support system?
My wife is an absolute animal when it comes to supporting what I have done over the last 20 years. She has been a critical piece towards my success by making sure everything was taken care of on the home front while I was taking care of the business side. She was outstanding about bringing the kids to me for lunch or dinner and never put pressure on me or made me feel guilty for having to do it.
(A bit of a sidebar on this but relevant I think: even though I worked as long and as hard as I did, I never missed a child’s event. This belief that you have to sacrifice spending time with your kids is a complete myth. I concentrated on quality time over quantity, and regardless of my day or how bad the business was going, I made sure to leave in time to get to sporting events and recitals. I may have had to go back to work, but I never missed one.)
These are just some of the things that go into owning a business that I think many people either don’t think about or cannot fathom. As I said before, knowing now that this is the case, I would not change a thing. I have no regrets and have enjoyed everything about being responsible for my security and the future and well-being of my children. When you work for somebody else, regardless of the experience, you are at risk of their decision-making. And while 9 to 5 jobs work for most people, the thought of doing the same thing day in and day out held no attraction for me. In fact just thinking about it right now makes me want to shoot myself in the face.
For me, the payoff has been tremendous and while having achieved success is excellent, having lived a life on my terms is the ultimate payoff. I provide this insight humbly and understand that everybody has their own experiences and opinions and these are merely mine. But if I were you I would quit my job and chase after what you want to do. The risk for me is the juice that makes life worth living. It’s whether or not you are able to deal with the consequences that will set you apart. I wish you all the luck in the world with whatever you decide and I hope this is helpful!