"My start-up is gonna make me rich!"
If you’ve read my previous post about the chances of start-up success, you may be thinking, “Yeah, but it’s worth the risk because I’m gonna be so stinking rich by the end of it”. Well, as you may have guessed (more by the way I’ve phrased this opening) you probably won’t be.
In fact, it is very likely that if you are one of the few people who have managed to start a successful business (i.e you’re still trading after 5 years) then you will probably be earning less that what you would have been earning if you’d had stayed in your old job. The evidence is fairly sparse (as usual) though it could be almost 50% of “successful” business owners earn less that what they would have been earning if they’d stayed in their last job.
From my own experience, Jo and I would have been significantly better off if we had remained teachers (which says a lot when you consider how much teachers earn). And when I worked within a lovely and successful chocolate shop, the owners earnt considerable less than what they did in their previous careers.
So please don’t start a business to try and get rich, you’re much better off staying exactly where you are. Yet, if you’re just passionate about something to the extent you’re willing to take a significant pay cut for, then this is a much better rationale for any entrepreneur.