Each week as Smallbizlady, I conduct interviews with small business experts on my weekly Twitter talk show #SmallBizChat. This is excerpted from my #SmallBizChat interview @SherriGarrity. Sherri is the founder of Corporate Fugitive, a company that provides business and marketing coaching to aspiring entrepreneurs and business owners who want to go from overwhelmed to extraordinary.
In 2007, she walked away from a raise and a successful marketing career in the corporate world to start her own consulting business. During her transition she found that there wasn’t a lot of information and support out there specific to entrepreneurs coming out of a corporate environment – so she established Corporate Fugitive. She has lots of free articles and how-to information on her site at http://www.corporatefugitive.com
Smallbizlady: How did you become the corporate fugitive and what are the typical reasons people quit their jobs to start a business?
Sherri Garrity: Many people choose to leave careers behind because they want flexibility, or have reached a ceiling in their income and want to have more control over their futures. Other common reasons are a desire to leave a legacy and create something, to fulfill a dream or passion. People also start businesses because of a change in life circumstance like job loss, relocation, or post retirement. In my case I hit a wall energy and health-wise and decided that I wanted to be able to spend more time at home with my young child.
Smallbizlady: What is the number one mistake you see people making when they quit a job to start a business?
Sherri Garrity: The biggest mistake I see is when someone does not take the time to truly consider what they want from a business. As a small business owner there is little or no line between life and work, and so if you don’t take the time to really think about your income goals, the way you like to work, the kind of flexibility you want, etc. you can easily create a business that simply becomes a job in disguise.
Smallbizlady: What is the best case scenario for a start-up entrepreneur?
Sherri Garrity: When you can create a business that is uniquely suited to you, by taking the time to consider what’s best for you, who you’re ideally matched to serve, and you create the business model that really fits you, it’s absolutely extraordinary and totally rewarding! This is the moment I strive for with business owners, is to see the light go on and their eyes widen when they realize the business is there for them to create exactly in the way that’s custom fit for them.
Smallbizlady: What are the things that someone can do first like maybe even before they quit their day job?
Sherri Garrity: It is best to do the research and test the waters while you’re still working. Think about what you want, research others who have businesses you like, and check out the market. Once you know what you want, it’s relatively easy to start a home-based business, especially with the online tools we have today. The other thing is I think what’s really valuable is to learn some basics about marketing and business and I’m not talking about being a master but you know, get some basic knowledge while you have the time to learn and your income is not dependent on it. Finally, build your network. Today with social media this is so much quicker than it used to be. Get out there and don’t worry about perfection, just take action.
Smallbizlady: What tips do you have for people who are still working for an employer while they’re developing their business?
Sherri Garrity: I think the number one is for first of all, keep it separate. You know, one of the biggest challenges, if you’re working while you’re starting a business, is what to tell people. Keep the worlds separate as much as possible and while you’re representing your employer, be the consummate professional and do your best job and absolutely do not market your independent services where you work. That’s a big no-no. It’s just not ethical and that’s not going to serve you if you try to market yourself at the same time. But if you’re out on your own time, attending an event or something, introduce yourself as the owner of your business, and do not mention that you’re also working for someone else. This makes you look disloyal to your employer and also not serious about your business. So keep it separate.
The second tip is to use the predictable income you have to invest in some of the tools you’ll need in your business.
Smallbizlady: Popular business advice is to save several months salary, or use someone else’s money to start your business. Do you have any advice in this area?
Sherri Garrity: Most of the 2500 or so new businesses that are started every day in Canada and the USA are started as sole proprietorships. Most are service based and also home based meaning most of us tend to transition from a job to working at home and usually on our own, providing services in our professional backgrounds. The first piece of advice I give to anyone contemplating making this leap is to go through the basics of what you want in a business, what you need to live on, what you’d ideally like vs what you have to make, and so on. Everyone has a different circumstance and this is also why I think that these kinds of generalized statements are unrealistic. As far as business loans go, it really depends on your type of business. Most of my clients are solo professionals who work from home providing a service and so wouldn’t require or likely qualify for a typical business loan.
Smallbizlady: What should someone expect when they quit?
Sherri Garrity: The biggest fear people have is where they are going to get clients and how they’re going to get the money flowing. These are valid concerns, but luckily with some planning and forethought you can get things rolling pretty quickly, although you shouldn’t expect to be replacing your income right away. If you do your homework and keep marketing you’ll get the work and this will lead to more.
Smallbizlady: Do you need to change your mindset to become an entrepreneur?
Sherri Garrity: I think the issue that no one really talks about that can be really difficult is the total mindset shift that is required. I joke about the “corporate detox” process but it really doesn’t feel that funny when you’re in the middle of it and no one told you what to expect. It can be completely exhilarating and completely terrifying at the same time. You lose your identity as an employee and all of its social stature and you enter the no man’s land of the not yet successful business owner. The other thing to remember is that you’re doing the unexpected and so many people who know you will think you’re crazy to walk away from the so called security of a corporate career. You need to develop a thick skin.
Smallbizlady: I have heard you say that business owners should CHOOSE their clients. Most think it’s the other way around. Can you explain that?
Sherri Garrity: Especially coming out of a traditional employee relationship we tend to think that our marketplace dictates our business and unfortunately many people who start businesses just take whatever work comes along. I advise that it is entirely possible to choose your clients and not only that, you SHOULD choose. You will actually make more money and enjoy your business more if you can tap into a specific unique talent that has huge value to the ideal client. Once you set up services that complement your skills and work preferences, this will make your marketing efforts more effective. You’ll be able to attract clients and connect with them in a way that will ensure they are the right fit for you. This is how you build a business instead of creating a job for yourself!
Smallbizlady: Many new business owners spread themselves really thin to take on work that maybe doesn’t fit them. They dream of getting a big client. You like to call this an anchor client. Can you talk about that?
Sherri Garrity: Many business owners are just so happy to get clients that they take whatever comes along. They think if they can land that one big secure, regular paying client that they’ll be set. This is sometimes called the anchor client. The problem with an anchor is that it is designed to weigh an object, in this case you, down! Be careful. Be clear to define your market and your ideal client. Be clear on your service offerings. It’s better to start out with less, but highly focused work than to spread yourself thin or to take clients on that don’t fit where you want to go. Also, if you are going to seek a big client, be sure you are not overly dependent on one or two for your survival.
The biggest danger of an anchor client is that you become complacent and you stop marketing. Never stop marketing.
Smallbizlady: Many new business owners have a problem with cash flow. Can you give us advice on this?
Sherri Garrity: Cash flow is really critical. You can have high fees and lots of clients and be really strapped if you are waiting a long time to get paid. The best way to ensure consistent cash flow is to make sure you’re always marketing. The marketing actions you’re taking today are what turn into cash flow months down the road. Also structure your products and services in such a way that you’re getting predictable and regular payments. There are many ways to set your business up to encourage this.
Smallbizlady: How much time do you think should be spent on marketing and managing their business versus doing the actual work of their business?
Sherri Garrity: I advise people they should be spending at least the equivalent of a day per week on this. In all businesses this is critical, but it’s even more so in new businesses that aren’t established yet. You can think of the business in two broad categories: marketing and operations. Marketing is the routine activities that keep you in front of your ideal client. For example, you should be spending your time developing new contacts, following up with current or past customers, attending networking events, and drawing clients in with activities like speaking, writing and so on. Think of this as part of your job as a business owner rather than a special project or something.
The other category is marketing operations. On a regular basis you must revisit your broader business and marketing plan. This means creating new services and products ahead of time, and rolling them out in a well thought out fashion.
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For more tips on starting or growing your small business subscribe to Melinda Emerson’s blog at www.succeedasyourownboss.com
Nice interview Melinda and Sherri. I like the perspective of considering what it is one wants from their business. It truly is rewarding when we get to do what is we enjoy and is well suited to us, and when get to serve others and even get paid for it.
Your encouragements to choose clients is also appreciated. Surely, at times, it is hard to say no to those willing to pay when they come along. However, this lesson of choosing our clients is worth believing in. When we consider the reality that we’ll be a lot happier with our work, our client will be a lot happier with what they receive and both sides will benefit it truly is best to choose and find the best fits.
Anthony–
Thank you so much for your comment. We are all tempted to chase money, but you will regret it long-term especially if you cut your price to do the work. Sometimes its best to be known for the work you turn down.
Good luck with your business–
Melinda
Natalie–
I am glad this information was helpful to you. Sherri and I are passionate about helping start-ups succeed as their own boss.
I am always here as a resource for your business.
Thanks,
Melinda
Gladys–
Thank you so much for making this post one of your articles of the week. I feel honored. I also thank your for helping to get the word out about #smallbizchat on Twitter every Wednesday.
I am always here as a resource for your business–
My best to you.
Melinda