Suggestions for someone on the verge of starting a small business
October 26, 2006 9:12 PM Subscribe
I'm thinking of starting a small business - should I do it?
posted by letitrain to work & money (23 answers total) 18 users marked this as a favorite
I've been a graphic designer, then web designer, for the last twelve years. Over the last five years my salary has plateaued at about $40K, with not much chance of growth.
Almost exactly a year ago, I decided to get serious about freelance after puttering around with it for years. I've made about $25K in freelance income (pre-tax) over the last twelve months, doing the work in the evenings and weekends.
I think I'd be able to replace my current salary if I went out on my own, but I know there are a lot of startup equipment costs and office rent that would cut into that. Without accounting for startup costs, I have enough money saved to last six months with no income. Counting a bare minimum of startup costs, I have enough for maybe four months. I'm also considering starting by working out of my home, although I don't want to think too small, and my home is not ideal for meeting clients (they would have to walk through most of the house to get to the office).
I know that my salary is too low for the work I do, and I am interviewing for other jobs (going to an interview tomorrow, actually). Unfortunately, the area I live has a deadly combo of extremely high cost-of-living and extremely low wages, so I don't think a much higher-paying job is out there. Combine that with a desire to have more independence and a bigger cut of profits, and I'm wondering if going out on my own is a good idea.
There are a lot of graphic design companies in the area, at least four major and who knows how many smaller companies and freelancers. There are two major web design companies in town, one doing very good work, one doing average stuff. I've been pricing myself much lower than the competition, but I know that would have to change at least some as my costs went up.
Basically, I think I'm afraid to make the leap, and I want to hear from other people that have tried it. Did it work, why did it work, and if it failed, why it failed. Anyone fail at it and then re-join the salary ranks? Any suggestions for easing the financial transition? Is a home office a good way to start, or is an external office a better idea? General suggestions?