The vast majority of successful entrepreneurs make their first move from employment by starting up their own business as a second job.
If you already have a second job you can afford to quit that one because your startup business will quickly replace the second job income. You are simply working for yourself instead of an employer on your off time. Your customers are now your clients, not your employer’s. You are your own boss.
But don’t quit your main job!
The Accidental Solopreneur
Marco D. DeSouza is an emergency room nurse at a local hospital in Riverview, Florida. His wife is also a nurse. Together they had been making extra money barbequing in their backyard for friends and neighbors. They couldn’t actually charge, but the donations were generous.
One of Marco’s friends suggested they go in to business together and make some real money. They worked different shifts in their main jobs and so they would be able to man the restaurant in rotating shifts. In honor of their professions, they decided to call it Emergency Ribz.
As partners, the two jumped through all the legal hoops to become licensed restaurateurs. They found a small, demolished space in a commercial building that was soon to be razed and replaced by a more modern structure. Nevertheless, they were able to rent by the month until that day comes.
They were joined by Marco’s wife Calena as they rebuilt the space into a suitable location to process takeout orders. The barbecue equipment was installed in the back.
Early on, Marco’s partner decided he couldn’t do the time and he quit. Marco was suddenly a solopreneur.
He and his wife continued to run the restaurant, but Marco was also an ambitious nurse. He had applied for a one-year training program at the hospital that would raise his status. The application was approved.
Unfortunately his continuing education at the hospital called for him to work on an unpredictable variety of shifts. No longer could he control his availability for the restaurant.
When I went to see him he had already decided to close the business for a year. He thought he would start it up when the course was finished.
That is, until I stepped through the front door.
I was there to do an interview for this essay. Without knowing the circumstances, I thought Marco was more than an “accidental entrepreneur.” Accident or not, it appeared he had been doing everything right to this point. It’s almost as if he has been taking the NotMyEconomics course through the Red and Yellow Zones and now he’s in the Blue. Unfortunately that’s not the case. Yet!
What Marco Did Right
To start out the conversation on the right foot I praised everything he had done right to this point. Then I lectured him on what had gone wrong.
Marco and his wife had kept their nursing jobs. In their spare time they had been barbequing in the back yard for fun and money. People picked the food up at their home or they would find them camped out on the beach somewhere.
Now Marco has a storefront on one of the busiest streets in the community. His potential market is much bigger and his brand is unique. Word is out that they are healthcare providers at the nearby hospital. People like that and their friends and neighbors have followed him there.
There are Troubles on the Down Side
At this point I began to lecture Marco.
There are problems on the down side. One of them has actually been turned to Emergency Ribz’s advantage.
Everywhere you look there are barbeque “pits” pulled by pickup trucks, some with tents or shanties, and then there are the chain stores. Proof enough that there’s a market, but also that there are plenty of vendors operating in the marketplace.
Every one of them thinks his ribs are better. They have a following and they think that’s all it takes to excel in the market. But, personally, I’m nervous about buying food out of the back of an itinerant pickup truck. I’m not so sure about the quality or safety. I imagine others feel the same way.
Marco’s accidental decision to move to a storefront on the busiest road in the community raised his level the minute the front door opened. He became a legitimate locally owned business.
However, legitimacy costs money.
There were the construction costs kept low because it was a DIY. Added to that the rent, licensing and point of sale advertising.
Unlike some startups, Marco’s financial capital was kept low and his human capital was high until his partner left him. Now he is undercapitalized. Human capital, that is. Not so much financial capital.
He had to limit open hours to three days a week. Too often he ran out of product before the day was done. His old backyard customers were okay with that. But new customers would be hard to draw in or retain if service were limited or undependable.
Therefore, Marco can’t take full advantage of the increased market. And, with overhead and the need for human capital, he can’t balance the two problems.
On top of it all, he is determined to take advantage of the OJT (on the job training) he has available to him at the hospital.
Have Your Ribs and Eat Them Too
If COWORK Entrepreneurs were up and running, Marco would be the perfect candidate for launching the first COWORK Entrepreneurs franchise.
“Marco,” I said, “you can have your ribs and eat them too. Human capital is your problem and I have the answer.
“You’ve got a good thing going here and I hate to see you close the business for a year. You will be back to square one when you reopen and you will have lost many potential customers. Meanwhile, you are on the verge of something big.”
I told him I had come to him thinking he needed me and I knew I needed him. “I still do and I think you do too,” I said.
“Before you close your business, I want you to know you have another option.”
I introduced Marco to my socially responsible, self-managed, profit-sharing (SSP) business model and laid out my dream for his Emergency Ribz barbeque.
“When everyone is an indie entrepreneur they own their own work and there is no payroll,” I explained. “Just like you, people work for their share of the profit.”
My dream for Emergency Ribz is an enterprise working under the SSP business plan. Marco would recruit people to work as indie entrepreneurs. He would favor nearby healthcare providers (in or outside the hospital) who are looking for extra income. It would further emphasize the healthcare connection.
Marco would train two or three people as barbecue chefs using his recipe and perhaps a few waitstaff as the business grows.
He would expand hours to six days a week and he would have the capacity to produce all the product needed each day.
Marco would become head coach at Emergency Ribz. He could schedule his involvement in the business around his changeable schedule at the hospital. Showing up irregularly would actually be an advantage.
He would develop his brand as a COWORK Entrepreneurs owned and operated by healthcare workers for extra income, emphasizing that they recycle their profits locally to benefit the community they serve.
It’s a natural.
I really didn’t come to make a proposal, but I did. Although it’s ahead of my schedule, I offered Marco the opportunity of becoming a pilot project. Even though my startup company is not yet functional, I would personally provide all the support that COWORK Entrepreneurs will eventually offer through a team of coaches.
I would do it for free. Forever. Or at least until he becomes an independent chain. It could happen.
The value of my offer is huge. When COWORK Entrepreneurs is up and running, franchisees will pay an estimated fee of $35,000 to $50,000 for a franchise plus annual royalties yet to be determined. If Marco accepts my free offer it will stand until he expands to multiple locations. Only then will there be annual royalty fees. And by then, Marco will be able to afford it!
Meanwhile, Marco will continue as an entrepreneur and healthcare professional on the rise.
But I concluded our talk with some strong words:
“Sooner or later you will have to decide what you really want to be. The first thing I want you and your wife to do is sign up for NotMyEconomics and complete the personal strategic plan we’ve talked about. And when it’s done I want you to make the decision: employee or entrepreneur?
“Until that is done,” I said, we can’t go forward.”
How the Barbeque Story Relates to You
Regardless of whether you are a craftsman, tradesman or professional, the barbeque story works better than a lecture in explaining the benefit of the socially responsible, self-managed, profit-sharing business model.
As I’ve opined before, I do believe someone with a high level of business acumen can adopt the SSP model DIY. But for most startup entrepreneurs, the strategic thinking is lacking and, with or without the SSP model, the vast majority of startups fail.
Here in the Green Zone we will explore the steps you can take DIY. You will advance methodically to the Blue Zone.
But in Marco’s case, he needs more and he needs it now.
Please move on to the next essay
Tactics: Transition from Dreamland to Reality
Marco, the “accidental entrepreneur,” reminded me of another man I know. Manoj Bhargava is known worldwide as an accidental billionaire and philanthropist who invests 99 percent of his money in projects to change the world by helping people help themselves.
He had been a monk in India for 12 years when he decided to change careers. He came back to the U.S., where he had received his education, and accidentally produced a powerful drink now marketed as the 5-hour Energy brand. You see it at every checkout counter.
He really didn’t come back to the U.S. to get rich. He wanted to become (get this) a socially responsible businessman whose work would help people help themselves.
The 5-hour Drink would hardly fit that bill, but the billions it has produced is being used for the common good.
Manoj Bhargava is now the man behind a business park in Farmington Hills, Michigan where civic minded engineers search for solutions that will serve everyone but especially the poorest among us. The engineers own their own work and Bhargava backs them unconditionally.
He has poured a reported $1.5 billion into creating a simple desalination device that more efficiently turns brackish water into fresh. Not a bad project for the folks in Detroit! And India.
Meanwhile, he’s still supporting a plan to drive a cable to the center of the earth to tap into energy that will cheaply supply people in every corner of the earth.
Can it be done? You can’t tell Manoj Bhargava or his team of innovators it can’t! Meanwhile, his engineers have produced an exercise cycle that produces enough electricity in a day to power the average house!
Viva la socially responsible indie entrepreneurs! Accidental or not.