You have a side gig that’s starting to do well. You’re always thinking about how can I improve my product, how can I scale, how can I do better. So much you lose focus at work. That’s how I felt when I was about to quit my job to start my own startup. But before I quit, I went through this checklist before I was fully committed.
The Quit List
If you answer “No” to any of the follow questions, you’re not ready to quit.
Do you have sufficient savings to live off for the next 3 years?
Many businesses won’t make a profit until the 2nd or 3rd year. This is due to a high sunk cost of starting the business and advertising expenses to market the product. It’s unlikely you will take an income in the 1st year unless you have unicorn levels of funding.
Do you have any huge expenditure in the next 5 years?
Are you planning on getting married, moving out, having kids, sending your or sending your kids to college? These huge expenditures can cause financial headache and force you back to a lower paying role just to pay the bills.
Do you have a working MVP built?
Do not leave your job if all you have is a business plan. What you think will happen will in most cases be completely different from what will happen. You need a working product and real sales in order to make proper forecasts into the future. If you don’t even have anything to sell, there’s no reason to quit.
Is your business model proven?
You might have a product but do you have everything around the business built? Do you have a solid strategy to gain new customers? Are you producing a healthy 30-50% margin on your products? Even if your product works, it doesn’t mean that the business is profitable. Create a “worst-case” scenario forecast to see when you’ll be seeing a profit.
Is your business growing?
Is your business consistently growing the same percentage month over month? If not, you need to reconsider if your business is viable into the future. Cost of acquisition consistently increases as you put more money into advertising platforms. Make sure you have a stable way of acquiring new customers at a reasonable cost before quitting.
Is your business dependent on any external factors to survive?
Are you a re-seller of services or have a lot of dependencies for your service to work? Are you confident these companies will continue to offer these services to you in the next few years?
Will quitting your job accelerate your growth?
This is the most important factor when leaving your job. Everyone dreams of the startup life, but it’s not as glamorous as you might think. It’s a 7am to 10pm job with little to no financial stability. The hybrid life is the way to go where you have a stable 9-5 role with a side gig after 5. Only quit if you have to, not because you want to.
If you’re interested, this is also an amazing read before thinking of quitting your job. It comprises all the top reasons why startup fails so you can plan ahead to prevent it from happening. Read: Why do so many startups fail?