Happy Birthday to My Business
May 5th marks the one-year anniversary of registering my business. I am the sole proprietor of a media consulting company. I help people get on TV: crafting their pitches, shaping compelling content, and helping with their “at-home” studios for remote interviews.
My first year goals were small: discover my client base, manage cash flow, expand my network and service offerings. I’m happy to report I have met these goals and am now entering Year 2 with a focus on scaling up and expanding.
This week I’m sharing five key pieces of advice I’ve followed during the make-or-break year for many entrepreneurs.
Key advice: Get Your Finances In Order
I’ve been thinking about working for myself and working freelance for a few years now. In fact, in the summer of 2019 I had committed to finishing one last season with The Marilyn Denis Show (Canada’s top-rated daytime lifestyle show). It was our 10th season, and represented a decade of my life.
Ten years is a long time to work on the same creative project. I had moved into a management position, which focused more on work flow as opposed to creative flow.
Season 10 is a milestone for any TV show. I wanted that to be my final year so I could leave on a high note. I also needed that year to build up as much of my emergency savings as possible.
Most personal finance books recommend having at least three months living expenses in a savings account. The logic being three months is roughly how long it would take for you to find work if you lost your current job.
When you start freelancing or consulting, you want to double that figure. That’s how long it will take you to establish yourself as a solopreneur, secure paying clients, and get paid by said clients.
I was on my way to saving up that six month target based on my leanest months: no takeout, no dining out, no new clothes, no travel, no home projects. Then in a cosmic “be careful what you wish for”, we hit March 2020.
The pandemic threw my careful timeline nearly out the window. I held onto my job like a lifeline. But I also kept saving for my escape route. The forced austerity of lockdown life made it really easy to save as much as possible.
Here’s another bit of advice if you’re thinking of making the move from corporate work to self-work: do your major banking when you’re working for a major company.
In Canada, the pandemic also brought borrowing rates to historic lows. And housing prices through the roof. Which meant it was the perfect time to refinance my mortgage.
Big-ticket loans like mortgages come with a lot of risk for banks. They like to loan money to people with secure income. If you work for a major company and have good credit, you’ll get more favourable rates.
Now that I’m working for myself, financial institutions need to look at the earning power of my business over a few years. They’re looking for consistency and sustainability — neither of which I’ve established in year 1.
I’m staying put in my home, with my existing mortgage until my business is solid enough to net me a decent rate.
The best piece of money advice I got came from a friend who had her own successful freelance business for well over a decade. She suggested I take a part-time job, preferably one below my skillset, to pay the bills while I grow the business.
This move set me up for success in ways I can’t even imagine.
I took a part-time news writing position at a 24-hour news network. I could write from home, which made it easy to build my business on the side. No commute meant more free time to work on client pitches and segments.
I started the business in May. I signed my first client in July. I started getting paid from her in August — five months after launching the business. The first payment was $400.
If I relied on my emergency savings to carry me through, I would have been broke mid-year. The news writing job allowed me to find and secure clients I knew I would have success with.
I started with one client in August. At the time of this writing I have four active clients, with two coming up this spring. There’s a possibility of yet another client coming on board bringing my total to seven.
But I’ve also met with many other potential clients who simply weren’t the right fit. They either wanted services I wasn’t prepared to offer at this time, or weren’t ready to commit at my price point.
Working the part-time job meant I never had to take work out of desperation. Or lower my fees just to sign a client. I could let my decisions be guided by the work I wanted to do, not the money I was desperate to make.
Emergency savings should be reserved for just that: emergencies. I’ve dipped into mine once. I took the month of December off to recuperate. Between consulting and news writing, I worked pretty much every day from May to the end of November.
I also took that time to reflect on the business, so I could enter 2022 with focus and clarity. This would be the year I weaned myself off the news writing gig and focused on the business full-time.
I did just that at the beginning of April. I might have to dip into my emergency savings again while I get my new client work up-and-running. But I’m in a much better position heading into this summer than I was last.
Embrace the bridge job in the beginning. Make sure it’s something you can leave behind at work. You don’t want leftover projects and stresses clouding your mind while you build your business.
And when it’s time to let go of the bridge job and focus on the business full-time, do it. Do it quickly or you will never give yourself the time to adequately build your own business.
The information in this article is for entertainment purposes only. It should not be used for financial or business advice
