The 10% Entrepreneur
Live your startup dream without quitting your corporate job.
If you no longer believe that a corporate job can provide 100% safety and stability, yet are not ready to see yourself become a 100% entrepreneur, why not become a 10% Entrepreneur? Entrepreneurship is not all-or-nothing proposition. This book gives a method to integrate entrepreneurship in your career without giving up your corporate job.
I found myself to be an ideal reader for "The 10% Entrepreneur: Live Your Startup Dream Without Quitting Your Day Job" by Patrick McGinnis. For a long time curious about entrepreneurship, I have always imagined that this is an all-or-nothing story and thus had trouble envisioning one for myself: I could not really convince myself of the worth of a few business ideas I had, and then, there are many things that I really love about my day job. Equally important, I did not want to give up the relative stability of a corporate job at the time when my better half was himself transitioning from a corporate job into the world of freelancing and entrepreneurship. As a big family, we needed to protect the downside. This book has opened my eyes on entrepreneurship as a much more flexible proposition. You can start integrating entrepreneurship into your career step by step, on your terms. The book gives a method and suggests several very useful exercises to reflect on your 10% Entrepreneurship Plan and start acting on it.
My Key Takeaways
What does it mean to be a 10% Entrepreneur? You will invest at least 10% of your time and, if possible, 10% of your capital into new investments and opportunities. By leveraging your base of experience and your network, you will choose opportunities that play to your strengths and that are complementary to your career and your interests. Most important, you will be the owner of everything you create. You may change your career at multiple points in a lifetime, changing functions, changing roles, and changing companies, but you’ll always be creating value for the most important employer of all: you.
10% Entrepreneurs are not born, they’re made.
Why should you become a 10% Entrepreneur?
One job is not enough.
There are valid reasons NOT to become a full-fledged entrepreneur: lousy lifestyle, financial risks, abandon of status and affirmation, no right idea, failure sucks. If you become a 100% entrepreneur, it's a calling, and success and money are not the only drivers of your decisions.
However, entrepreneurship is not all-or-nothing proposition: if you abandon the idea that one job is supposed to provide everything you need, you will see that traditional careers and entrepreneurship are not mutually exclusive.
10% Entrepreneurship is about expanding laterally, and integrating entrepreneurship in your career, on your terms. Your can tailor entrepreneurship to your life like never before.
Four benefits of pursuing part-time entrepreneurship:
Downside protection and diversification.
Unlocking sources of the upside.
More interesting and engaging life.
Developing of critical skills that make you a more complete professional.
10% Entrepreneurship is not the same as freelancing. Freelancers bill the services rendered. Entrepreneurs take ownership in projects or ventures.
Five types of 10% entrepreneurs
The Angel invests in entrepreneurial ventures either on her own or as part of a group.
The Advisor provides expertise and receives compensation in the form of stock.
The Founder focuses her attention on one company and has operational control. The balance between day job and entrepreneurship is delicate.
The Aficionado is the Angel/Advisor/Founder, with love. The driving motivation is passion, not just the pure profit.
The 110% Entrepreneur has already launched own ventures and now takes stakes on the side.
What kind of 10% entrepreneur are you?
Consider your resources: your time, your financial capital, your intellectual capital.
Although each resource is discrete, when taken together, you can think of them like a portfolio and balance the areas in which you are lacking with the areas you have strength and abundance.
Investing isn't just about money.
If you're worried about time, but have financial capital, Angel can be your best option.
If you have more intellectual capital and time than money, you should consider becoming an Advisor.
As a Founder, you bring in all your resources.
As an Aficionado or a 100% Entrepreneur, you can structure your involvement as you see fit.
Your 10% Plan
Your 10% Plan combines (1) Resources, (2) Investment Process, (3) Network.
It is a living document that you will return to periodically.
Making the most of your time & money
You should take stock on how you spend your time and your money, and see how you can make at least 10% of your time and financial capital available for entrepreneurship.
10% is a target, but more than anything else, it is a mindset.
Managing your time and managing your money is about making choices.
Playing to your strengths
Your 10% is about what you want to do.
You generate two lists of ideas: you explore (1) your interests - be broad and don’t be shy, it's about what you want to do and (2) your intellectual capital - the one you have today or could reasonably acquire in the foreseeable future.
Prepare your biography - a list of your professional achievements and experiences, organizes into four sections: (1) professional experiences, (2) skills, credentials and awards, (3) Academic history, (4) Personal interests and experiences.
Look for your 10% in the overlap between things you want to do and things you do well.
Finding, analysing and committing to ventures
You need to have a clear methodology - an investment process, which consists of 5 parts:
Sourcing. Find the opportunity. It's a networking activity. Seek large.
Screening. Assess how it fits your 10%. Do I have the resources to successfully include this in my 10%? Do I want to include it in my 10%?
Due Diligence. Analyze the opportunity. This is the part of the investment process where you will think like a venture capitalist - to analyse the business rationale and opportunity. It's akin to writing a term paper. One of the most enjoyable part of the due diligence is the opportunity to meet new people and get out into the world. Don't fall in love with the idea. Most due diligence comes down to a combination of common sense and attention to detail. No matter what kind of business you are evaluating, you will focus on the same three topics: the business, your partners, your role. You will ask three key sets of questions: (1) is this business positioned for success? Will return on investment compensate for the risk? (2) are your partners, from investors to the managers, competent and ethical, and are incentives properly aligned? (3) will this venture fit within your 10% plan so that you can contribute meaningfully to the company and make connections or gain experience and intellectual capital for future endeavours? Detailed Due Diligence checklist provided in the book.
Final decision. Commit or Pass. Since you don't have a crystal ball, you have to to trust your due diligence
Documentation. Make it official. For Angels - sign contracts in which you buy shares in a company. For Advisors: negotiate and sign advisor agreement in which you agree to a minimum level of commitment in exchange for shares. For Founders - document the agreement with your investors or partners.
Building Your Team
You will not become 10% Entrepreneur alone.
If you are worried or unsure where to begin, you can always join an angel investment group. Investing as a part of a group can give you the confidence and resources you need to learn so that you can work more independently in the future.
Finding the right answer is about knowing where to look. When you are a 10% entrepreneur, working smart is just as important as working hard. You're not going to measure success by the number of hours you spend working.
Your portfolio of activities will benefit immeasurably when you build a team and cultivate mutually beneficial relationships. Everything you're doing will be stronger and work better when you bring the right people into the mix.
The more connectivity you build among the people in your network, the better.
Your network will not be hub and spoke in nature, requiring everything to go through you. Rather, it will be multipolar: your goal is to match like-minded people to each other so that they can collaborate, with you or even without you. Over time, things will start to hum and you'll be part of a living, breathing circle of people who are working on exciting projects. When you've built that machine and it's up and running, you will choose when, where and how you want to be involved.
Make Your name the most important brand on your business card. You're going to be talking to a lot of people, so in order to make good use of everyone's time, you'll want to be able to clearly explain who you are and where you're going. You need a solid elevator pitch. If you can explain your expertise and what you're looking to do in a few sentences, you'll clear up the confusion and project confidence, credibility, and a sense of mission to the people around you. Your pitch structure: Your name, what you "do", why you're credible in that area, what you're looking to achieve in your 10%.
Recruiting people to your team. In general, there is far too much networking and not enough to show for it. Start with your existing network. If you cannot find the right contacts through people you know and you need to communicate with individuals outside of your network, you will have to do cold calls. Depending on the industry and context, they will produce surprising results. Entrepreneurs know what it's like to be asking others for help and so tend to be responsive. Se a goal of speaking to a minimum number of people per week, whether in person or over the phone. Keep notes, flag contacts for follow up. You can leverage your network for sourcing and due diligence, but also to find talented individuals who are able to engage in projects.
Your reputation is your most important asset. Every time you commit to a new venture, you're doing so with conviction. This isn't an exploratory mission or a hobby, it’s a dimension of your life that deserves proper time and attention because it will become part of your personal track record. Your level of commitment is of critical importance, since the success in your 10% will open new doors in the rest of your life.
Overcoming obstacles.
Every entrepreneur, from 10% and up, finds that resilience and a firm commitment to a long-term vision are the most important tools of the trade. Just as full-time entrepreneurs, 10% Entrepreneurs can also fail. The difference is that 10% entrepreneurs have far less to lose.
Don't forever stay a wantrepreneur. Take some pressure off by remembering that your 10% is a work in progress.
FOBO - fear of a better option; failing to commit in case something better comes along. FOMO - fear of missing out - is saying yes to everything. If in FOMO, you risk committing to an opportunity for the wrong reasons. FOBO will make you waste valuable time waiting around for a perfect opportunity. There is value in keeping your options open for a period, choosing one opportunity and closing down the others is essential.
Always act with integrity, especially when it comes to your employer. You cannot build your 10% at the expense of your full time job. When conflicts arise, your day job must come first without question.
Look for ways to break out of your comfort zone. Just because you're doing what you do best doesn't mean that you will always play it safe.
Take charge of your education. Understand accounting.
Spread the Wealth. It's not a zero-sum game.
Surround yourself with people who bring out the best in you. Businesses are about ideas and they are about people.
You have only one life: have fun and make it interesting.