It's a big, brave leap to set up on your own but if you feel ready to take the plunge then it will be one of the most satisfying and rewarding things you do.
There is a lot to think about before you decide if running your own business is for you so here is some insight from my own experience that I hope will help you along your way. Whilst mine is a recruitment business, much of this will apply to various different business ideas.
1
Be informed - before you start trading, talk to as many people as you possibly can to get advice, contacts, help... and, if possible, try to find a mentor. Ideally someone from the industry who has done it before.
2
Write a business plan but don’t be freaked out if you deviate from it. The idea is that it should change course as the business evolves.
3
Be ready to put in the hours - despite popular opinion, recruitment isn’t easy and it’s definitely not easy money. It’s an emotional rollercoaster and takes a lot of hard work, hours and persistence. But with hard work does come the reward.
4
Non-competes - if, like me, you start a recruitment business having just left a previous agency, then the chances are you are on a strict non-compete with previous clients. Do not be tempted to try and trade with them, it’s not worth it until after the non-compete has lapsed. The last thing you need is to face being sued for £1000s! There is plenty of business out there to be had and I can assure you that your story will be way more interesting than most hiring managers hear from your competitors. Even if they don’t have business to give you now, they will remember you when they do.
5
Don’t be afraid to ask people to give you a chance. As a new business every penny counts and you’ll need to get some placements / cash coming in quickly, but this won’t be without taking some risks. One of the most important new client wins I had early on was with a very well-known drinks business. I cold-called the CFO asking him to give me a chance at a role he was recruiting and said that if I didn’t fill it, then he would never hear from me again. He gave me a shot and thankfully it paid off, I filled the vacancy and they’ve been a fantastic client ever since!
6
Make sure you have a support network behind you on the journey. Initially I had my parents who gave me a free roof over my head, friends / siblings who helped with office space, websites, accounting, business plans, etc. It’s really important you not only have people there to support you as there will be times when you need to lean on them, but you also need to be as well-informed as possible at the beginning. Take feedback on the chin (good and bad) and be decisive.
7
Make sure you have enough cash in the bank at the beginning for the business to survive for 12 months without collecting any money. Keep your personal and business costs to a bare minimum until you have cash coming in.
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Celebrate the wins! When you make a placement, buy a bottle of champagne and celebrate with those that have helped you, or treat yourself to something you'll enjoy. I also celebrated with placed candidates, which was great fun and I found after a bottle of champers they were also helpfully willing to recommend colleagues!
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Don’t be afraid to ask people for help, you might be surprised at how many people come forward and offer their help when you tell them you run your own business.
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Everyone has an opinion - trust your gut instinct and run with it.
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Be a specialist and know your market better than anyone else, it’s what will make you different.
12
Don’t be afraid to break the mould. Be different, tell people about it and clients will follow.
13
Have multiple sources of income - I cover both permanent and contract recruitment, both excellent sources of income and can be reliable for different reasons.
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Contract recruitment - if you plan on setting up a contract business initially make sure you have the banks onside early on and the back-office processes in place to hit the ground running.
15
Have good outsourced people onside to help when needed. Early on you won’t be able to justify having in-house HR / Marketing / Accounting / Pay & Bill teams so find companies that can help take on that burden when needed.
16
Scaling out vs keeping small - everyone thinks that scaling a recruitment business is the way to make the real money, but I can tell you from personal experience that the smart money is to keep lean and specialised. Invest, have multiple sources of income and save yourself the hassle and grey hairs. This is just my opinion of course and if you have dreams of building a huge recruitment agency then good on you, but the same early days tips still apply.
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If you scale - get a well known non-exec advisor to help you. They are worth their weight in gold and this will make a huge difference.
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People buy from people - tell your story and demonstrate your sincerity to help them. After all, your success is their success.
19
At the beginning be prepared to be a day-to-day recruiter, admin person, credit controller, accounts payable clerk, sales person, website developer, husband, wife, father, mother - everything will fall on you.
20
It sounds obvious but as long as you focus on placing roles / making money - the rest will fall into place. Try not to sweat the small stuff (although that is still important), your number one priority is to win clients and place jobs.
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