Some years ago, a man who had been the pastor of a small church retained my services. He and his wife lived in a church-supplied house on a subsistence income. But he loved caring for his people. He had outstanding talents for diplomacy, tact and administration. He also had a fascination with, and would fantasize about, investments - pretending he had put huge sums into various stocks and bonds, then following their progress in the newspaper.
Eventually, this man got caught in a cross fire between two factions of his congregation and was forced out of his ministry. Not sure what to do with his life, he took a job sitting in one of those little watchtowers on a drawbridge, which left him plenty of time to just think. Can you guess where he wound up?
This man is a perfect example of someone who was right for self-employment. He had the talent, the need, the drive and the clarity of mind to do it right. Anyway, a typical employer would have ignored his talents, looked only at his background as a minister, and laughed him right out the door no matter what kind of job he was looking for.
He and a partner established a financial planning firm. He was perfect for it and the firm has been - and continues to be -extremely successful. It is individuals like this man who establish the 5 to 10 percent of the start-up businesses that succeed each year.
On the other hand, I've worked with a disproportionately high percentage of people who started self-employment ventures and failed (or succeeded and hated it).
The reason is pretty simple. Joe Average gets fired or burned out and decides he's going to start his own business. Not because he's right for it, but because he's too angry or frustrated with "the system" to look for other work. As nearly everyone does at one time or another, Joe hears the call of the wild: Self-employment. It sounds like a fairly attractive choice.
So, Joe establishes Average, Inc. Before long, however, he realizes that self-employment is a 25-hour-a-day, eight-day-a-week commitment. He realizes that he really doesn't have the business acumen to make smart decisions or keep the books, nor does he have the people skills he needs to deal with customers. Within six months, Average, Inc. is out of business and Joe is even angrier and more frustrated than before.
He'll tell everyone (and everyone will tell him) that Average, Inc. was simply undercapitalized. That, so they say, is why most businesses fail.
I can't agree. If the toughness, the business sense, and the people skills were there, the capital would have been there as well.
There are times when self-employment is the right career choice, and that's what it should be - an open choice. Still, I think those times are rare.
What's more, self-employment should never be a goal in itself. If it were, it wouldn't matter whether you owned a restaurant or a ditch-digging business. But it does matter. It matters a great deal.
Self-employment should be viewed only as a means to an end, with that end being a career goal. If there is a field or industry that you absolutely love and in which you're sure you have the talent to succeed, then self-employment might be the right choice. That is, if you can clearly identify strong needs within yourself for in dependence and leadership.
Even then, I usually urge people to put the idea on a shelf for a little while, to mull it over. It is, after all, like buying a car. It's human nature to convince yourself that you've purchased the best one available, bar none, and ignore the problems. It's not until after you've driven it for awhile that you start to recognize and acknowledge its shortcomings.
Besides, the decision to start your own business is far more serious than the decision to go to work for someone else. You can walk away from a job. It's much more difficult to walk away from your own business.
