Ten Truths And Ten Lies About Self-Employment

Dear Liz,

I just got laid off from a job I've only had for 22 months.

I did as much due diligence as any non-employee could do, but at a certain point I had to trust my boss when he told me "The plan is to keep growing the company."

Watch on Forbes:

Actually, the plan was to grow the company to a certain size and then sell it. We were sold last month and I got my walking papers soon after.

This is the second time I've been caught in this trap. I know it's time to consider self-employment, but I have heard some horror stories about how much time you have to put into building your business.

If I went out on my own, I would do independent IT consulting. Part of me really wants to do it, and soon. I'm tired of killing myself in a full-time job, getting paid zero for overtime, and ending up out on the street.

What's your opinion? Is self-employment worth the trouble, or not?



Dear Blake,

We are all entrepreneurs now, whether we know it it or not. We are all business owners.

Your entrepreneurial muscles will keep you employed and on your path whether you work for one employer full-time, or consult for several clients at once.

Your entrepreneurial mindset is the key!

Here are ten truths and ten lies about self-employment.

Ten Truths about Self-Employment

1. It will help you greatly to create a plan for the launch of your small business.

2. There is a lot of work to do up front in a new consulting business. Eventually it gets much easier.

3. Your income may go up and down a lot in the first couple of years.

4. To be successful as an independent consultant, it helps to get good at looking for your next project while you are busy with the current one.

5. You will grow powerful new muscles as a consultant. You will learn to negotiate fees, set boundaries with your clients and advocate for yourself. You will learn to spot Business Pain in your environment and ask probing Pain questions. You'll learn which clients to avoid and how to fire a client who isn't worth your time and trouble.

6. By launching your own business you will take full control of your own career path and your income. If you have ever chafed under corporate rules and restrictions, you will love making your own decisions rather than having a boss make them for you.

7. Your business will cause you to worry, lose sleep and doubt yourself at times. As you step into your power and overcome every new hurdle placed in front of you, you'll get stronger. You won't worry so much.

8. As a business owner you'll have the benefit of all the available information concerning your market, your competition, the value of your work to your clients and your company's strategy a luxury few if any traditional employees have. You will not be laid off one day without warning.

9. As the CEO of your business you won't be consumed with corporate politics, what your boss thinks about you this week, whether or not you're going to get promoted or how well you did on your performance review.

10. As a business owner circumstances will force you to stand up for your own value. If you aren't willing or able to do that, then self-employment won't help you. You can be a door mat as an employee or an independent consultant, and in either case you will be trampled underfoot.

Ten Lies about Self-Employment

1. Not everybody is cut out for self-employment. (Who says? We are not taught as kids even to think about self-employment and most people are afraid of it, so how would we know?)

2. You have to be a subject matter expert before you can think about launching a consulting business. (Nonsense you only have to have one pain — solving ability at first, and to know what kind of pain you solve!)

3. As a consultant you are just as subject to a client's whims as any full-time employee, but you also don't get benefits. (You are subject to a client's whims only as far as you allow yourself to be. The benefit of consulting is that when one client leaves, you can find another one to fill their place. You are not dependent on one client for your entire income, the way traditional employees are.)

4. Independent consulting is only feasible if you already have a year's salary saved. (It would be great if every new consultant and every working person had a year's salary saved, but most new consultants don't have much if any money put aside. Many people turn to consulting because they're not having any luck job-hunting. They may not have three cents in the bank but they figure out how to get one client, then one more and so on!)

5. There is too much risk and too little reward in launching a consulting business. (It is riskier to rely on one employer for all your career development and financials needs than to spread those things among several clients.)

6. Consulting is only for people with advanced degrees. (Absurd! Many people try consulting because their credentials aren't acceptable to the bureaucrats and keyword-searching algorithms at local companies. They realize that they won't get a traditional full-time job because of their quirky backgrounds so they go into business for themselves and soon pick up those same organizations as clients!)

7. Consulting is for people who love to talk. (False! Who cares whether you are glib or taciturn when your work speaks for itself?)

8. Once you work independently, employers won't hire you as a full-time employee again. (Some companies take this stance, but there are lots of fish in the sea! Talented people tend to stay busy. Consultants learn how to network, build relationships everywhere they go and reach out to decision-makers to start conversations. They get hired, full-time or otherwise, because they know a lot about the problems they solve.)

9. If you want to start your own business, you have to spend thousands of dollars with lawyers, branding experts and accountants. (Pish-tosh! You can incorporate your business for about $60 online. One visit with an accountant and one with an attorney may cost you a couple hundred bucks. Your marketing investment may be zero. The "back-end" part of launching your business is insignificant.)

10. Consulting is lonely. (Ridiculous! Consultants have more latitude than all but a few free-range employees. They get to network when they want. They get to move in and out of different communities and spheres. When you launch your business, you will design every aspect of your firm including services, pricing, marketing and maybe most importantly, your schedule.

Don't forget that you can begin consulting on a part-time basis. You don't have to leap into full-time consulting, certainly not right away. You can build a two-lane highway.

One lane is your job search to replace the job you just lost. The other lane is a slow lane. You will start planning the triumphant launch of your consulting business in the not-too-distant future. We are excited to see what you bring forth!



Follow me on LinkedIn.
