• Mon, Aug 10, 2020
  • Steps to Transition from Corporate Exec to Business Owner
  • Ask SCORE: Steps to take to transition from corporate exec to business owner

    BY GRAY POEHLER Special correspondent | Aug 8, 2020

    QUESTION: I am soon to be a victim of corporate downsizing, having held a position of responsibility for more than 15 years. I am considering starting a business in competition with my employer. How do you suggest I proceed?

    ANSWER: To begin, you should review your employment contract to determine if you have signed a non-disclosure or non-compete agreement that will hamper your starting a similar business.

    Generally speaking, non-compete agreements, if too restrictive, are unenforceable.

    However most include language that prevent you from soliciting your employer’s clients, employees or stealing their intellectual property.

    It is always best to try to leave on good terms.

    Let your employer know of your entrepreneurial intentions to get a sense if they will oppose your plans. When you do depart, be sure not to take anything with you that could precipitate legal action.

    When starting a venture it is reasonable that you would rely on experience and contacts.

    However, keep an open mind for opportunities that complement the industry you formerly served, as opposed to direct competition with your former employer.

    As an example, say you worked for an appliance company. You might want to start an appliance repair service. You would not be selling appliances, only repairing them. Many of the customers you worked with at your former employer could also become your customers, assuming the appliance company did not offer similar repair services.

    As you worked your way up the corporate ladder you, undoubtedly, held many positions ranging from managing and motivating people, to meeting sales goals and staying within budget. These are skills that can benefit you as the owner of your own business.

    Rather than starting from scratch, contact a business broker.

    Look for an established business with positive cash flow, good employees and a dependable customer base. Determine how much money you are willing to invest. Check with your tax accountant to see if you can use 401(k) money without incurring a tax or penalty.

    You can avoid many of the mistakes entrepreneurs make by crafting a written business plan, hiring experienced people and seeking advice from people you know and trust.

    Resources like the Small Business Development Center, U.S. Small Business Administration and the SCORE organization provide free and confidential business counseling, by volunteer mentors with a varied wealth of experience.

    Link to original article. 

    Please contact us if we can be of any assistance. 
    Steve Niehaus, MBA, CBI