It was almost exactly a year ago that I decided to leave the luxuries of a full-time job and venture out on my own. It’s been an incredible year, and I wanted to share my thoughts and lessons learned from my first year in business.

What’s your reason?

Entrepreneurship is not for everyone, and doing it just for the sake of doing it will land you in a whole lot of trouble.

For those who don’t know me, I have a risk-averse personality which basically means that I avoid risk at all cost unless my logical brain can quantify and justify it. Because of that, it took me more than 3 years from thinking about it for the first time to finally making the leap. I’m not saying it should take everybody that long, but I think it’s important to know what you’re in for and to have an exit plan. Your personality, family situation and financial stability will (and have to) play an important role in your decision-making process.

During my 3 years (!!) I had many conversations with personal mentors, folks in the community that have done the same and my wife. The final decision came after a 5 AM “meeting” with my wife, where I presented a plan and budget for what my first year could look like and after we were both happy with the potential outcomes and what that would mean for our everyday life. (For the record, she wasn’t happy with the timing of that “meeting”)

If you’re considering the world of entrepreneurship you may want to read Start with Why by Simon Sinek.

Choose your role

Specific to our industry you have two primary choices when going on your own: Consultant or contractor. Brent Ozar has a great blog post about it and definitely worth a read.

Making the choice of contractor/consultant is not about good vs. bad, experienced vs. inexperienced or easy vs. hard. It has everything to do with your personality, previous working experience and preferences in terms of the services you’d like to provide. Deciding what role you’d like to play will determine how you operate in your business, and here are some of my thoughts on that decision-making process:

Contractor: As a contractor, your primary role will be execution. You will work on long-term engagements (typically 3-6 months) for a company that already has a long list of (hopefully) well-defined tasks, and it will be your job to take their lead and execute. You’ll be a worker bee.

Apart from aligning with a few good recruiters and keeping your resume in good shape, there’s really nothing else you need to do in terms of sales or marketing. You’ll interview with companies like any other prospective employee, most likely work on site and your clients will provide all the legal documentation or contracts.

Contracting is a good choice for code junkies, people who need stability (i.e. long-term contracts) and people who don’t want to deal with the sales, marketing and legal aspects of a business. Your hourly rate will be lower than that of consultants, but you’ll have a lot of stability and very little non-billable work.

Consultant: Consultants typically play more of an advisory role. It doesn’t mean that they don’t write code too, but their focus on a project is usually diverse and include dealing with the business and technical folks alike…often acting as intermediary to provide architecture guidance and translate end user requirements into technical artifacts.

As a consultant you will need a good mix of soft and technical skills as you would be interacting with the business and management as part of your engagement. Your hourly rate will be higher, but you will have to take care of legal contracts (MSA, SOW) and do a lot of non-billable work (sales; marketing) to land your next engagement.

You will probably have more than one project going on at the same time, and context-switching is really difficult if you’re not used to it. I switch between different clients and projects at least 3 times a day…remaining focused and productive is challenging at times.

Relationships matter!

Whether you’re a consultant or contractor, relationships are one of the most important ingredients to your future success. It takes both time and effort to build relationships, and the keyword to any successful relationship is trust.

I’ve been very fortunate that customers from previous employers and projects approached me after I started my own business, and I can attribute it to the relationships I’ve built with them over the years. If you’re planning to go out on your own, start paying attention to the relationships you have with customers, employers and co-workers now…it’ll most certainly pay off in the long run.

Timing is everything

As with many other things in life, a good decision at the wrong time could turn into a disaster. Starting your own business is no different, and part of the reason it took me such a long time to decide was about finding the right time.

What is the right time? It’s probably different for everyone. For me it was about having enough work lined up to mitigate some of the financial risks. It was also about finishing up some projects with my previous employer. As a matter of principle I have never left in the middle of a project, or at a time where my departure could have had a negative impact on the overall success of a project.

Find balance

Even if you’ve worked for consulting companies in the past, where the almighty billable hour and utilization is a prime topic, making the shift from knowing what you’re earning to a variable income that depends on how many hours you’ve worked can be difficult. You can easily find yourself fixated on billing more hours and working long days, neglecting your health, family and friends in the process.

This is an area I’ve been failing in the past year, and have made my theme for 2019 “Balance” to focus more on achieving the ideal mix for me.

Pick your end game

Starting with the end in mind is very useful (almost critically so) when starting your own business. You’ll have to decide what it is that you want to build. Are you building a company that will have employees, or are you just happy to work for yourself?

It doesn’t necessarily mean that you can’t change your mind down the road, but knowing this upfront helps you focus your efforts and attention on the right things.


Before this turns into a novel, here are a few final thoughts:

  • Working for yourself can be hard. Read about Eugene Meidinger’s experiences here after going out on his own.
  • Find a good lawyer and CPA before starting your business.
  • Reach out to your local startup community for assistance and advice. We’re very fortunate to have the #yesphx community here in Arizona, and they’ve been tremendously helpful.
  • Get organized quickly. From setting up your accounting system to managing your time, it’s almost too easy to neglect the back-office tasks. Before you know it, you’ll be knee deep in administrative work if you’re not consistently paying attention to “all the other stuff”.

Leave a Reply

%d bloggers like this: