MBA2558 Q&A Wednesday: I Just Graduated. Should I Get a Job or Start My Own Business?

0:05Hey, welcome back to the$100 MBA show. I'm Omar Zinhome, and today's episode is Q &A Wednesday where we answer a question from one of you, one of our listeners, one of our subscribers, one of our community members. If you've got a question you want to ask, go ahead and message me. You can submit your question over at 100mba.net slash Q. Today's question is from Fabian and Fabian asks, I just graduated from university. Should I get a job or start my own business? This is a fantastic question, Fabian, and it's a big one because it's a big decision. We're going to break down both options, and I'm going to help you make a choice that sets you up for success.

0:44So if you're listening and you need to make a choice of whether to take a job or stay in your job or to go ahead and go out on your own and start your business, you're going to love this episode. Here's the thing. There's no one size fits all answer. You know, it's just so hard for me to just give you this answer without knowing all the details. So I'm going to give you the different pros and cons of diving right into entrepreneurship now or taking that leap a little bit later after being in a job for a bit. I'm going to give you everything you need to know so you can make a decision. And it should be clear by the end of today's episode, right?

1:22So you can actually move on and start taking action. I want to start by saying that if you're young, you just graduated from university. You're in a very fortunate position. It's one of the most advantageous positions you'll ever have in your life. This is not going to get repeated because you basically have very little responsibilities, if any. Right. And if you don't know what I'm talking about, I know as a young person, you might be thinking, well, I don't really understand what that means or how that feels to have all these responsibilities. Just imagine what your parents life is like. your aunt, an elder, somebody you look up to, somebody that's in their 40s, 50s.

1:58What do they have to do every day to fulfill all the responsibilities, right? What keeps them up at night, right? They got a mortgage. They got car payments. They got to put food on the table. They're responsible for their significant other or maybe their children or maybe an elderly parent, right? They have to keep up with the Joneses, so to speak, mean, keep up the lifestyle, go on vacations, you know, have brunch on the weekend, whatever it might be. there's just so much on their plate. There's so many obligations they have. They have so many bills to pay. They're worried that they're losing time because they're getting older.

2:33So there's very little room for risk. And this is one of the things that you have to understand that when you're young, time is on your side and risk is very low for you because worst case scenario, you end up where you are right now. Now, I don't know everybody's situation. You might have some responsibilities already as a college graduate. You might be married, you might have a child, but even so, it only gets harder from there, right? Your responsibilities continue to increase from that point on. So this is actually a pivotal time. So even if you're maybe in your 30s or 40s or 50s or whatever, and you're thinking about leaving your job or starting a business or whatever it might be, you know, you have to keep in mind your responsibilities in life and how that weighs up in terms of the risks you're about to take right now by starting a business.

3:22So let's start with option number one, the option I prefer you to take, which is to take the leap and start a business. If you're a French graduate, you have very little responsibilities. You have a lot of flexibility and you're likely to have less of a chance of risking it all. One of the things you have to understand is that as you grow older, as you start accumulating things in life, you have other assets, you have other responsibilities, there's a lot more that you can lose, right? When you're young, you don't have much to lose, right? Especially if you're still living with your parents and you have a roof over your head and a meal if you needed a meal at home, right?

3:59Essentially, you don't really need to have a job, right? Essentially, you could survive if you're living with your parents. And for a lot of people, that's an option. For many other people, it's not an option. Maybe that's not how things work in their household. They're outside of their house. There's maybe some issues with their family. Every situation is different. But even so, you know, having enough money to just survive, to have a roof over your head and to eat your meals is pretty doable. And we'll talk about that in a moment. But the point I'm making here is that you have the advantage of being able to take some risk right now.

4:33Even if you fail at starting a business once, twice, three times, it's not that bad because the loss of that failure is not huge. Again, you'll never have fewer responsibilities than you have right now. So use this window as an opportunity. So many entrepreneurs that I've read in biographies that I know personally that have been highly successful in their 40s, 50s and 60s, they credit the fact that they gave themselves the time and space to become a better entrepreneur when they were younger without responsibilities. So some people had that advantage and it really helped them become millionaires, billionaires in the future.

5:11So there's something about that, about allowing yourself to learn and to fail young when responsibilities are low and you're able to kind of take more risks and try new things, right? The thing about risk is that if you ever play card games like poker or blackjack or whatever like that, the thing about risk is if you're playing with house money, you are more aggressive with your bets. You're more aggressive with the risks you're taking because you really don't have much to lose because you're using the casino's money, right? And worst case scenario, your venture doesn't do well. You raise some capital, it fails.

5:46Yes, you're going to have to bounce back from that. But you didn't really lose the shirt off your back, right? You still have some place to sleep. You still have a way to eat. So you have some time for trial and error. The second reason why I think that jumping into entrepreneurship right away might be a good move is that you're going to be able to have full focus and momentum. If you dive straight into business after you graduate, you have the advantage of giving 100 % of your focus, of your energy, of your effort, of your brain power, of everything you've got to your business. No distractions, no competing priorities.

6:22You have clarity, which is priceless when you're building a business. Building a business requires momentum. It requires you to have one good day after the other, build upon each day. And it's hard to get momentum when you spend so much time on it. We don't give your full attention on it. Being all in on your business can help you gain traction faster and get results faster. So if you're tempted to start a business and go with option number one, then here's an action step for you. Set up a six to 12 month plan with a clear set of milestones, right? To keep you on track, right? I'm going to make my first sale here.

7:03I'm going to make X amount of revenue here, X amount of revenue this month, you know, within the next six to 12 months. Plan it out. This focus can help you get to profitability faster in your business, can allow you to get more traction and make it your full time thing. Now, I'm going to tell you that this is not easy. This option is not easy if you need to earn money to survive, right, to maybe pay your rent, to, you know, have some food, have some fun, all that kind of stuff. right if you have responsibilities if you have a partner in life if you have children this is not an option really unless you have somebody that can fund your lifestyle maybe your partner can you kind of carry the weight until you get off your feet with your business but you have to remember you don't know how long it's going to take especially in your first business venture you have no business experience you have no confidence in what you could do so it could be indefinite and that's that could put a strain on the relationship so let's just keep this in mind.

7:57I know that this is not easy for a lot of people. So I'm going to give you another option. Don't worry, I'm going to get there. But before that, I want to give you my third reason why going full time on a business after graduation is a good idea is that it's going to be the best personal and professional growth program you've ever seen in your life. You're going to learn more in a month than you learn in four years in university. You're going to learn about yourself. You're going to learn about what you could do. You can't do your strengths, your weaknesses. You're going to learn about the marketplace.

8:24You're going to learn about about society, you're gonna learn about human behavior, you're gonna learn about so much, right? Running a business is gonna challenge you like nothing else, right? You're gonna learn how to be resilient, you're gonna learn how to make decisions right quickly. And you're gonna learn about how to be a better leader, you're gonna learn about skills that will benefit you and your business now and in the future, they're gonna learn so much, right? And this is why I love entrepreneurship in general, it forces you to become a better person. And this is why I continue to do it.

8:50I can tell you firsthand from my own experience that all my business attempts weren't successful, right? They were failures in my path, in my history of building businesses. But all my successes, all the things that actually just took off and did well, started with a failure, right? This podcast was not my first podcast, right? I had another podcast that didn't do so well. It failed miserably. And I learned what not to do when I started this podcast. And that's why it was successful because I learned so much from that failure. Same thing with my software business, Webinar Ninja, that I grew for 10 years, had 30 ,000 paid users, and we just got acquired earlier this year by ProProfs.

9:33The reason why I had the success is because it started with a failure. I built a product that was a total dud and taught me that people don't want this type of product. They want a tool to help them build and run smoother webinars. And that's where Webinar Ninja came from. That's where the idea came from. And that's how I was able to have a clear strategy to build a better business. So even my successes are attributed to my failures. So just keep that in mind that you're gonna have some failures along the way and they're probably gonna be the best things that happen to you in the moment. It's gonna be horrible, you're gonna hate it, but in hindsight, you're gonna love it.

10:06So let's move on to option number two, where you do get a job. Whether you're freshly graduated from university and you get a job or you have an opportunity for a new position, a new job, and you're thinking, should I take this position or should I start a business? So this is a good option, but it's not just get a job. It's get a job with a plan, with a strategy. We're going to approach this differently than normal because we don't want to find ourselves stuck in a job. And I'll tell you what that all looks like. So what does this plan look like? What does getting a job mean to me? Well, it means to me that you're going to go into a job where you can learn as much as possible on the job about building a business as successful as the business you're working for.

10:51OK, so it's like you're getting inside and understanding how the sausage is made. You're figuring out how this business actually works. You're not just going in, clocking and clocking out and getting a paycheck. You're basically going in for R &D. right and a good plus about this is you're gonna learn a ton and you're gonna get paid for it right so this is going to change your perspective about what kind of job you're looking for so if you're looking to start a you know a software company a tech startup then work for a tech startup okay that is going to be a lot more beneficial for you when you start a business if you're looking to you know start a restaurant then work for a restaurant so you're gonna understand the ins and outs and the mundane tasks you have to do to pull off this business.

11:35So work in the industry that interests you and where you feel like you want to start a business, right? You're going to learn the ins and outs of how that business operates. You're going to look at the opportunities where you can gain skills, learn how to make decisions, understand how your boss is making decisions. The owner of the business is making decisions. And that way you can go home, take notes, figure out, okay, how am I going to do this on my own business? I get asked all the time from entrepreneurs here in Sydney, hey, I'm thinking about getting a job, but I want to learn on the job so I can start my own business.

12:07I ask them, so what kind of business do you want to run? And they're like, oh, I'd love to have a tech startup. And I was like, okay, cool. So where do you want to work? Oh, I was thinking about working in banking. I was like, why? Why don't you work for Canva? Canva's hiring, right? Canva's right here. And it's a huge success story in Australia. Why don't you work for Atlassian? There's so many tech companies here that you can learn from. It doesn't have to be that big. You can actually work for smaller startups that maybe have a smaller team, 30 or 40 employees, and you can learn the ins and outs.

12:35And it's actually better because you're going to be able to have more access to the founder and understand what allowed them to start the business in the first place. What are some of the things that gave them momentum, allowed them to make their first hire? You can go out for coffee with leadership easily and learn from them. It's going to be very hard for you to hang out with Melissa from Canva because she's super busy. She's got a unicorn business, over a billion dollar valuation, billions of dollars of valuation. But the point here is that there's so many opportunities for you to join the company that you want to build.

13:09The best thing you could do is to join a company at the stage of where you want to be in three to five years with your business. So they're just a little bit ahead. You can learn how to get there. So when you start your business, you have all the fresh knowledge that you need. now again don't just go into your job clock in and clock out absorb as much information as possible right say this week is hr week i'm going to go to the hr person and i'm going to say hey tell me a little bit about how you do your job what do you do here i want to learn about your position your department right get some information take some notes down figure out how hr is run in this company, right?

13:49Next week, sales. Hey, salespeople. Great to meet you. What do you do with the leads? How do you make these phone calls? How do you reach out to people? How do you know that you have a good customer, a bad customer? How long does it take to make a sale? How do you close sales? Learn, right? You have all these amazing departments at your disposal. You can ask questions for free, right? And get all this information so that you can then build your sales department, your HR department, your finance department, all that kind of stuff. So just take out somebody for lunch once a week and learn from them.

14:22All right. Number two, if you're going to take on a job with a plan, save. OK, you want to be as frugal as possible in this time period. And remember, you know, you're looking to learn as much as possible in a short period of time. So maybe you're in this job for 12 to 18 months, maybe 24 months maximum. Why do I say maximums? Because having a paycheck is addictive. OK. And if you are not on a tight budget and you start spending all the money that you make on having maybe a more lavish lifestyle, you'll never get out of the right race. You'll get comfortable with the luxuries. And in order for you to continue to have those luxuries, like a fancy car, like fancy brunches, like a beautiful apartment or beautiful furniture or whatever it might be for you, the more likely you're going to stay in the job to maintain that lifestyle.

15:11But if you get the job and you stay conservative with the way you spend, it's going to motivate you to quit the job and use the money you're saving on the business you want to build. Entrepreneurs that know how to delay gratification are the ones that win in the long term. So financial stability is huge. Use this time to save as much money as possible so you can create that runway I talked about that you didn't have to start your business right away. And aim to save enough money to support yourself for the next 12 months without working. So again, it's going to be easier for you to save that amount of money when your expenses are low.

15:48So for example, let's say you have a very lavish lifestyle. And in order for you to be able to live that lifestyle, you need to have$100K saved a year. That's going to be very hard for you to save$100K in that year if your expenses are$100K a year. But if your expenses are, let's say,$30 ,000,$40 ,000,$50 ,000 a year, it's gonna be a lot easier for you to save 25, 30 a year. In two years, you have enough runway to quit your job, live off your savings for a year as you start to build your business. So as an action step, you wanna set up a savings plan, treat it as a non-negotiable. So part of your income, your salary from this job goes to your business fund, goes to your runway fund.

16:29So you can just set this up in your bank. Most banks have this where you can just create a savings account inside the bank account and have an automatic deduction after payroll. So when you get paid, just say, okay, that day or the next day, please just automatically deposit X amount of money. So a good amount of money, I would say, that will not rock your world, but at the same time be significant enough, is 20 % of your salary. Try to live off 80%. 20 % of your salary, go away. If you could do more than that, 30%, amazing. 40%, now you're going to be able to quit your job even earlier and be able to have a longer runway.

17:06The easiest way to do this is to lower your expenses drastically. Get some roommates. If you're living on your own, if you're still living with your parents, amazing. Stay at your parents as long as you can. You get free laundry. You get a free meal if you ever need to. Remember, this is temporary. You're going to have a launch pad soon when you get your business out there and you start seeing some success. Number three, work on your business in your free time. That means after work, go to a cafe, go to a co-working space, go back home, right? And work on your business. Just because you have a job doesn't mean you can't start building something on the side.

17:39Use the evenings. Use the weekends. Work on your business idea and start gaining that traction before you fully commit, before you leave your job so that you have something going for you to say, oh, I got a winner here. I think that it's going to be a good time for me to quit my job because if I give 100 % to this business, I could see X amount return. I did this, right? I was a teacher for 10 years. I was a high school, university educator. I was a chair of department before I left my career in education. And I side hustled. I built businesses on the side for those 10 years. I learned how to build businesses.

18:13I learned how to make a great product. And eventually I left my career, but I had some business experience. I had some ways to make money. I had the start of my business consulting firm at the time. So it was easier for me to transition because I had something I can lean on to make me successful in business. Lastly, when you're in a job, I'm going to repeat this because I talked about it earlier, but it's so important. I got to say it again. The paycheck trap. The longer you stay in a job, the harder it can be to leave. A paycheck can be incredibly addictive. It's consistent. It's comfortable.

18:47It's secure. But remember, the goal is to build something of your own. Set a timeline. If you're working to save and learn, commit to 12 to 18 months and stick to it, right? Having a clear end date keeps you from getting too comfortable. Understanding that this paycheck thing that's coming to me every two weeks or every month is going to end. So let me wrap up today's Q &A question from Fabian. There's really no wrong choice here. It's what you're ready for. Are you able to take that leap right after graduation? Are you able to take that leap and start that business comfortably? When I say comfortably, I'm not saying it's easy.

19:22I'm saying it's going to be difficult. It's going to be challenging. But I say comfortably in saying that you're not going to be behind on your bills or be neglecting responsibilities that you have, right? So you want to make sure that all your responsibilities are taken care of whatever you have right now. But if you need this ability, if you do have responsibilities that require a paycheck, then go ahead and do that. Lower your expenses. Understand that you just can't have the same lifestyle and continue to work and expect to have some savings. No, you got to lower your expenses, cut things out from your life.

19:52It's temporarily, remember, you know, when I did this, when I left teaching and I had to go full-time entrepreneurship. I cut out so much of my expenses. I sold my car. I had no car. I got around with public transport. I lived in a one-bedroom, was kind of a studio apartment. I went from a three-bedroom house to a one-bedroom studio apartment. It was incredibly humbling because I didn't spend anything on myself for the first few years. I didn't buy any new clothes or even go on any holidays or anything like that. Total cut down. I was in my 30s. This was uncomfortable. But the point is, I knew that if I was going to have a chance of success in business, I need to lower my expenses while I get my business off the ground.

20:35Remember, you're in control of your journey. Decide what fits your needs right now and go all in with that plan, whether it's to work and learn and have a plan of exit at a certain date or to just jump right into it and start your business. Where you don't want to be is this weird in-between stage where you're not making a decision. I'm not sure. I don't want to start my business yet. Maybe I should get a job. All this umming and ahhing is wasting precious time. Commit to a plan and go for it. Thanks for tuning into the$100 MBA show. Again, if you've got a question you want to ask, you want me to answer it right here on Q &A Wednesday, I'd be happy to.

21:12You can even just sign off as anonymous if you don't want me to give you a shout out. All good. Just go to 100mba.net slash Q and submit your question right there. Happy to do that and answer it right here on Q &A Wednesday. Thanks so much for listening. Thanks so much for watching. If you're on YouTube, make sure you hit subscribe so you get the next episode automatically, and I'll see you in the next episode.