Is it safer to run my own business or work for a larger company?
I have been working on my own business, more as a hobby, on the side and am now working to make it a full-time business. I have been debating with my wife the security of having my own business as opposed to working for a larger company, which I have done most of my career. I am curious what others think about this topic.
I made the choice to have my own business, though I have also worked in regular positions at larger companies. I've decided that with layoffs so prevalent, there's always risk and less job security than in the past decades.
There is a risk in being on your own. Your name may not be well known in the marketplace, in which case you'll be developing a client base (which has already been done to a significant degree in larger companies). You possibly have some steady customers already, since you're doing business part time -- but now, you'll be doing the work but also doing your business development as a higher priority (unless/until you hire people/consultants) so you may not have much personal time anymore; and if you're in a professional services industry you may find your business has peaks and valleys. I think managing time and money etc. is more challenging and more important a skill when you're on your own, and you do not have the resources of a bigger company available as you do when you're an employee somewhere. You'll also need to pay for your own training and development to stay totally up to date in your field, as an expert your customers can trust. And, you may need to consider having a workplace away from home to improve your business location and better separate your family from your office and its visitors.
All of this will affect your wife, too. The rewards for each of us are probably different; for me, having my own business enables me to do the work I love, creatively and with high quality, without concern for internal company politics. I wish you all the very best.
What's your preference? Having your own business provides you the flexibility to make your own hours but you will have to work hard. Working for a large company provides you a steady paycheck but it's not secure. What happens if the company has a reorg? Can your business sustain your lifestyle? Is it something you enjoy? You need to sit down and really strategize on the better option. Only you can decide what to do - we can provide us based on what we know but in the end, it's up to you. Good luck.
I think this is almost like when deciding to have a baby. There will never be enough stability, enough money, have traveled enough, have done enough with your partner alone, big enough house, small enough mortgage, big enough car, etc. etc. But you know in your heart, that is what you want to do and you just need to take the plunge.
Starting your own business: you will never have enough contacts, a big enough network, enough savings, good enough idea, enough security, etc. One thing I have learned in the past 20 years is that sometimes you have to start several businesses to be successful, you will fail, you will feel happy, worried, sad, and then happy again. But you will never know if you can do it until you try it. Not everyone is cut for it, but how will you know? there is a big chance you will fail, so what? there is also a chance you succeed or learn learn a lot in the process.
My thought on working for a big firm: you have a feeling of security but do you really have it? you can be fired anytime and then what? look for another one, that takes time too, it is a project in itself. When you have your own business, you are forced to expand your network, know the latest trends, technology, etc. be in the know. If you lose a contract, you already have all that in place to look for another one, you have time to catch up, take some time off, etc. One advice I got a few years back was to always save 50% of what I make so that I have that money there for when I am looking for a new contract, so that I can take some time off, study some, etc. To see the downtime as a positive thing and not get desperate.
Also, my wife has a steady job, we get her pay check on a regular basis, benefits, that also helps to have piece of mind.
We could not have said it any better than Mike Sutton above, we would only add that your risk tolerance is a major factor.
Regardless of working for your own company or for a large company; it is always good to have at least 12 months of income stream(savings). This is beneficial should you not have the ability to produce income (either having left your employer or due to the growth stage of your business.) Or if you have a mature business but for some reason your business gets slow.
Having multiple income streams are also a VERY good option to have as well!
It's not an easy question to snswer. If you have a will, an opportunity... you have to run your own bussiness
I wouldn't say it's necessarily "safer." It's definitely different & to some extent you have a lot more control over your fate. But,how "safe" it is depends on your business, the market, how you're running your business and a little luck. I have been a one-person consulting business for 15 years and there have been ups and downs. Sometimes I have more work than I can handle & have to outsource & other times I've struggled to make ends meet. One thing I do recommend is that if possible, at least one of you keeps your "regular" job to cover benefits & maintain a steady income base for awhile, as you grow your business. Good luck!
This really is a personal decision. Owning your own business gives you great freedom, but you have to understand it is your business and not your personal bank account. To many people will live off their business which eat away at the business profit. In fact there are CPA which will talk you into do just that, live off the business. Here the problem, if you work from home and you write off part of your house, buy items under the business name and etc. If the business fails, your collectors or creditor have right to collect. That car under the business name, repo. If you live in a state like Texas where personal creditor can't foreclose on you home, business creditor can even if you own the home out right.
Flip, working for a business. You are just in the rat race and today there is no loyalty to the employee or business.
There's lot of writing on the web about the value of side projects. What I've read is that you know when to abandon your job and turn your side project into your job when you are spending more time/energy/thought on the side project.
Safer? that's a matter of personal preference. I personally believe that working for myself lets have me have more influence over my future. Control is illusory, influence is possible. When someone else is signing your paycheck, you will never be entirely safe. BUT you need to have the stomach for it. And since you mentioned your wife, she must Must MUST agree to this or it will never work.
A great question and some great answers here...
You have the 'luxury' of having worked your own business idea on the side for a while. That is a great way to get started. As a result, you should have a feel for whether there is a real demand for your product/service or not. Even if you have had success, make sure you determine the total size of the market and honestly consider your competition.
So, realistically ensure there is a real and big-enough demand for your product/service, ensure you have clear differentiation from your competition, and make sure you have enough cash to support the start-up.
Stating the obvious, you are better to say with your job than to start up a business that will fail. There is no certainty either way, but at a minimum, continue to see if you can build your own business on the side. If you answer the above questions positively, then take the leap. If you can't, yet, then stay with your job knowing that you continue to build a side business which you can fall back on if the worst happens from "the man".
I have learned one simple truth. There is no guarantees whether you work for a large company or yourself. Big companies have layoffs due financial difficulties and small business cannot workout as well. There is little security either way in my opinion. At least with your own company sky is the limit and you decide your fate.