Eric Bahn, founder of the social network Beat the GMAT, worked his day job until he was ready to take his business full-time. By the end of his fourth year, he was making twice as much from his start-up.
I’ve never considered myself an entrepreneur at heart — I’m far too risk averse to put everything on the line and jump headfirst into a venture from scratch. But during my six years as an entrepreneur, I’ve learned that entrepreneurship doesn’t have to be all or nothing. It is possible to incrementally build your business — while holding down a 9-to-5 job — until your side business is cash-flow positive. Then you can leave your day job to become a full-time entrepreneur in a proven business.
In fact, that’s exactly how I built Beat The GMAT, a social network for MBA applicants. By the time I left my job to become a full-time entrepreneur, I had a proven business model and sustainable revenue. Today the site serves 2 million business school applicants each year and is fully profitable without any external funding.
I founded the company in 2005 from my Stanford dorm room. I love the education space and I am energized by the idea of solving education needs through online communities and social media. When I launched Beat The GMAT, I had a dream of working on this venture full time. But I was 23, and funding was a major challenge. I also had more questions than answers about how to run a business and my college degree in Sociology certainly didn’t provide me many relevant or transferable skills.
[time-link title=”(Read about Groupon filing a $750 million IPO)” url=http://curiouscapitalist.blogs.time.com/2011/06/02/groupons-sellout-ceo-files-for-750-million-ipo/]
So I decided to hedge my risk. I accepted a full-time job as a product manager at a respectable Silicon Valley company. With my day job bankrolling me, I was free to be highly experimental with my side venture and didn’t fear failure. At the end of the day, I would still get my salary and benefits even if my social network collapsed. I was optimistic and thought that I would only work at my day job for one year before I could move onto my start-up full-time.
One year turned into four. During those years, I spent about 40 to 50 hours a week at my job and another 40 to 50 hours a week (nights and weekends) working on my side venture. The lifestyle was extremely taxing and had precious little time to spend with family, friends, or working on hobbies.
Still, I was having so much fun. At my ‘real’ job, I was fortunate to work with managers who were great mentors. I was able to select projects that were relevant to my own small-business interests. It was also during this time as an employee that I met the person who would become my business partner, who also coached me on how to think strategically.
I spent three years experimenting with my side venture while working full-time. And while I made plenty of mistakes along the way, I also enjoyed many successes. By my third year, my site traffic began to grow exponentially, and I was able to begin monetizing my site. By the end of the fourth year, I was earning almost twice as much from my personal venture as I was from my day job.
[time-link title=”(Read NewsFeed’s post about Tyra Banks enrolling at Harvard Business School)” url=http://newsfeed.time.com/2011/03/15/beauty-and-the-books-tyra-banks-enrolls-at-harvard-business-school/]
I was now ready to make a go at being a full-time entrepreneur, and I left my day job in January 2009. I’ve been fully focused on Beat The GMAT for two-and-a-half years now, and I wouldn’t change a thing about how I got to where I am.
Entrepreneurs should do some serious soul-searching and not be pressured to go full-time into their ventures immediately. There’s no stigma attached to being an entrepreneur with a 9-to-5 job. Instead, think of your full-time job as an opportunity to incubate your business.
Founded by Scott Gerber, the Young Entrepreneur Council (Y.E.C.) is an invite-only nonprofit organization comprised of the country’s most promising young entrepreneurs. The Y.E.C promotes entrepreneurship as a solution to youth unemployment and underemployment and provides its members with access to tools, mentorship, and resources that support each stage of a business’s development and growth.