Opinion

The 5 Best Ways to Build Your Business Before You Quit Your Full-Time Job

By  | 

The first advice is to be realistic. You don’t really have a “startup” until you quit and focus on it full time. At least in the sense that no VC will fund you if you’re just working part time. They’re not going to essentially pay you a salary to take this risk. It might be a project, even a side business that puts cash in your pocket, but it’s not a startup.

Check Your Employment Agreement

Your current employer may limit your ability to work on a startup while staying employed. Most work agreements have some form of IP assignment clause, but they vary in scope dramatically.

  • Some cover ideas that are in the same field, so if you worked at Facebook and were developing a new social networking tool there’s a chance they could assert ownership rights.
  • Others cover projects that were created using company tools or time. Some agreements state that anything you do on a laptop provided by your company, or using their tools, becomes their intellectual property. It’s lame, but often the law, and not respecting it can kill your company before it gets off the ground.
  • The most restrictive can cover anything you create while in the company’s employ, be it a new algorithm or the most awesome cookie recipe.

Build Your Team

The most important thing you can do before quitting is build your team. Are you going it alone or do you have a co-founder or two? Is this person as committed as you? How do you know? Founding a startup with another person is a decision fraught with risk so I’d suggest you review the following topics with your team:

  1. Have the Hard Talks: Who is going to be the CEO? What is the equity split going to be? What salaries will you pay yourselves? What is your vesting schedule going to look like?
  2. Get Personal: Do you have enough money to cover expenses for 3-6 months if fundraising gets hairy? Do your co-founders? Are your and their spouses/significant others bought into the idea?
  3. Think Through Every Detail: Where are you going to work? What schedule? What languages/frameworks? Is everyone doing this full-time? You’d be surprised how attractive those consulting gigs look when you haven’t had a paycheck in a couple months.

Get this stuff on paper. It doesn’t need to be notarized, but thinking through things in this level of detail has many benefits. It helps remove the gauzy view that many people have of doing a startup.

And know that there’s always going to be a risk. Maybe your co-founder’s parents get sick and he needs a steadier gig and a safer income. Or they learn they’re just not cut out for the emotional roller-coaster that is entrepreneurship.

Have a Plan if Your Boss Finds Out What You’re Doing

One danger you’ll encounter if you decide to work on your project before quitting is that your boss may find out. It’s important to figure out what you’ll do when you see her email address pop up in your pre-launch signup form.

You can minimize this risk by leaving your name and pics off the project website, but assume you work for Sherlock Holmes, she figures out what you’re up to, and decides to fire you six months ahead of time. What will you do then?

Start Building Your Product

If you’re doing B2C projects it’s quite possible to scale a business without ever leaving your day job. Marco Arment did this, creating Instapaper while also being the lead developer on Tumblr for many years.

Thanks to a proliferation of development frameworks, freely available distribution channels, and low-cost promotion tools, you can gain huge traction before making the plunge.

It’s much harder to do this in B2B markets, unless you’ve built some self-serve SaaS product. Pitching customers and supporting the ones you earn is an all encompassing effort.

There are ways to start getting a B2B company off the ground:

  • If your company is going to be selling a service, you could try open sourcing a tech framework, essentially following the Red Hat model.
  • Or you could organize a group on Facebook/LinkedIn/etc.
  • Or you could start content marketing by creating analog tools that will solve some of your customer’s problems while getting them familiar with your brand.

Basically, do anything you can to start running your idea to ground. The point here is to be realistic about what you can accomplish on the product side

Activate Your Network Six Months Ahead of Time

If you know angel investors or seed stage VCs, reach out 3-6 months before you quit your job. You don’t want to ask for money in these meetings, instead the focus is getting feedback. They might know of an A+ team that is pursuing the same idea that has recently been funded. Or they may have potential customers in their portfolio.

If nothing else you’ll get a sense for how receptive they are to your idea and what their concerns are. The goal isn’t to walk away with a check, but you do want to start getting people feeling invested in your story so when you do quit you can come back to them during fundraising, ideally with a pitch that has some traction.

Good Luck!

This question originally appeared on Quora.

Gaurav is a Principal at Founder Collective.