Worldwide, around half a million new businesses are started every month. Every MONTH. So there is actually a good chance that you are thinking about starting one too.
So, let’s say you do. You want to become an entrepreneur. You have a brilliant idea and now want to go for it.
Right from the get go, you are faced with a tough decision: Should you take the plunge by quitting your job as soon as possible? By doing this, you can devote all your time to making it a success. Or should you keep working for the company you are with to minimize the risk?
Option 2 seems the safest choice, but also with a lesser chance of success. Right?
But is this assumption true?
Research showed that entrepreneurs who started their business next to their job (hybrid entrepreneurs), were 33% less likely to fail than entrepreneurs who took the plunge.
When these hybrid entrepreneurs quit their job eventually, they had a much higher success rate compared to individuals who quit their day job right away.
We are biased to think that entrepreneurs always need to take big risks in order to become successful. In reality, it seems that successful entrepreneurs have doubts about their entrepreneurship, have fear about taking the leap and are risk-averse.
Warby Parker changed the eyewear market as of 2010 by selling prescription glasses online, and thus avoiding the costly middle man. Although it quickly became a huge success, the founders stayed in school and doubted their idea. Co-founder Neil Blumenthal says:
“We want to hedge our bets. We’re not sure if it’s a good idea and we have no clue whether it will succeed. Just in case things don’t work, I’ve accepted a full-time job for after graduation. So has Jeff. And to make sure he would have two options Dave did two different internships over the summer, and he’s talking with his former employer about rejoining.”
‘Originals – How Non Conformists Move the World’ by Adam Wharton.
Here are some other highly successful entrepreneurs who also started out as hybrid entrepreneurs.
Phil Knight, founder NIKE
Phil Knight started his business by selling shoes from his trunk in 1964. He kept working as an accountant until 1969.
Steve Wozniak, Co-founder Apple
After starting Apple with Steve Jobs in 1976 he stayed employed at Hewlett-Packard until 1978.
“I still intended to be at that company forever. My psychological block was really that I didn’t want to start a company. Because I was just afraid”
Serge Brin & Larry Page, founders Google
Even though Serge Brin and Larry Page created the initial version of Google in 1996, they stayed in their PHD program until 1998.
“We almost didn’t start Google, we were too worried about dropping out of our Ph.D. program” – Larry Page
Stephen King, author
King of horror Stephen King worked for 7 years as a teacher, concierge and gas station attendent after writing ‘Carrie’.
John Legend, musician
Grammy winner John Legend released his first album in 2000 but stayed employed as a management consultant for another two years.
So why didn’t these highly talented people take the leap?
Because by reducing the risk, the chance of success increases.
In one study, both employees and entrepreneurs were asked which company they would rather start:
1. A company with a profit of 5 million and a 20% chance of success
2. A company with a profit of 2 million and a 50% chance of success
3. A company with a profit of 1,25 million and a 80% chance of success
The study showed that more entrepreneurs than employees chose the third, safest, option. They concluded that entrepreneurs are more risk-averse than the general population.
It seems that if you have a great idea and you want to succeed, it would be the best option to keep your job. For now. At least until you have made a big enough margin to go for it.