6 of the Best Tips for Transitioning from Employee to Entrepreneur

6 of the Best Tips for Transitioning from Employee to Entrepreneur

While many people dream of making the step from employee to entrepreneur, not nearly as many actually make the transition. The decision to move from on from working for someone else to being your own boss should not be taken lightly—although many people have said it is the best choice they ever made.

This transition requires a lot of preparation, and before jumping into it, you should think critically about what it will take to realize success. Some of the tips to keep in mind when preparing to make the transition from employee to entrepreneur include the following:

1. Build a network.

One of the most important elements of success for entrepreneurs is having a support network. Start out by seeking entrepreneurs who have had success in the field you wish to enter. This can help you learn from any of their mistakes and approach new opportunities with greater wisdom and confidence.


Your network also becomes an important resource when you are stuck making key decisions and need advice. Ideally, you will have a strong network before you decide to leave your job and devote yourself full-time to entrepreneurship—this will help you feel like you have some sort of safety net.

2. Create a reputation.

Building a reputation is different than creating a support network, although both are important. While a support network works as a sort of sounding board, a positive reputation means that other people look to you as a leader.

There are many different paths for building a reputation, from becoming more engaged on social media to seeking out opportunities to assume a leadership role, such as speaking at an industry event. Often, networking leads to opportunities to build a reputation, but it is important to see the two as separate. A reputation also depends on showing integrity and providing help to others without expecting favors in return. In the business world, a strong reputation can carry you very far.

3. Try out a side hustle.

Many people are often surprised by the amount of work involved with entrepreneurship. A great way to get a taste of what it takes to succeed without throwing yourself completely in the game is starting a side hustle while still employed.

A side hustle is an ideal way to learn more about making it as an entrepreneur while starting to build a network and establish a reputation. Also, the lessons that you learn through a side hustle can prove invaluable when it comes to building a business as a full-time entrepreneur. The trouble with starting a company as a side hustle is identifying the right time to quit, so it can be helpful to set goals and expectations ahead of time.

4. Save some money.

As you start out establishing your business, you may find that finances are one of the biggest sources of stress. You may need to make sacrifices in terms of your lifestyle so that you can divert more money to your business.


A great way to relieve some of this stress is to save as much money as possible while you’re an employee, which will provide more of a cushion when you’re an entrepreneur. Knowing that you have at least enough money to pay bills for the next six months or so can relieve a lot of stress, helping you focus more on your ventures.

Another option is lining up part-time work to keep some additional money coming in, but that can create new stresses by leaving you feeling stretched for time. However, if you can handle the time restraints, extra work can also relieve some of the financial stress of entrepreneurship.

5. Embrace versatility.

Something that many people struggle with as they transition from employee to entrepreneur is the inability to say, “That’s not my job.” Entrepreneurs must become a jack-of-all-trades, which often means taking on responsibilities that are outside of their comfort zone, if temporarily.

You will need to learn how to do virtually anything required of a business, whether that means referring to someone in your network for help or reading through old textbooks. Prior to transitioning from employee to entrepreneur, it can be helpful to pick up as many skills as possible. When you feel comfortable with more business processes, you will have less anxiety as you do new things. Often, people in your network can point to the most important skills to learn.

6. Practice stress management.

A common theme through all of these tips is the stress involved with entrepreneurship. When building a new company, avoiding stress is virtually impossible. For that reason, you should figure out how you best manage stress before you step down the road to entrepreneurship.

Everyone deals with stress differently, so figuring out your own healthy coping mechanisms is critical for success. Skills like time management, delegation, and prioritization will help, but you will still need to figure out how you can destress at the end of the day and return to your work refreshed the next morning. The alternative is burning out, which can prove disastrous. Importantly, you should learn to recognize your own signs of burnout so you know when self-care is necessary.

About the Author

Joanna RileyJoanna (Jo) Riley is an entrepreneur, investor, and advocate in technology, and is currently the CEO and Co-Founder of Censia. Jo has a highly experienced background in building and scaling companies, which she attributes to her deep passion for people and building technologies that allow people to be their best selves. She brings her wide knowledge of the industry to better transform the way enterprise companies hire talent. You can connect with Joanna Riley at @joannakiddriley on Twitter or on Linkedin. Read her full bio here.