You started a side hustle, and it’s finally showing some promise. But when do you decide to say goodbye to your day job so you can focus on your passion project full time? Dean McPherson, the co-founder of Paperform, a form-building business used by more than 6,000 companies worldwide, experienced this same quandary. Here are five signs that might suggest it’s time to take the plunge.
1. You’re growing
The most obvious sign is that you’re experiencing growth. McPherson shares, “We made the jump around four months after launch after we had seen some growth in recurring revenue. We definitely weren’t at a point of sustainability, but we were able to clearly see that with continued growth and the cash we had in the business, we’d be able to bridge the gap.” Having more work than you have time for is a clear signal that your side hustle has the potential to expand even further.
2. You’re passionate about your side hustle
Starting a side hustle is about more than getting some cash in your pocket. You need to be genuinely passionate about it—especially if it’s going to be your focus all day, every day. While starting a business has many rewards, it’s definitely not easy. Make sure it lights you up inside so that you’ll be able to weather the ups and downs. If your real purpose aligns with your side hustle, it will be much easier to sustain momentum when times are tough.
3. You’re self-motivated
“Being your own boss is a double-edged sword,” says McPherson, “you’re in charge of getting out of bed in the morning, and no one is going to yell at you if you go to the beach instead of putting in the time on your business.” Entrepreneurs are known for their commitment and passion. A key factor in sustaining the kind of energy, creativity, and drive needed to succeed is motivation.
4. You have a plan
As McPherson points out, “The worst thing you could do is quit your day job and start day one without any idea of what you’re going to do with your time.” Turning your personal project into a career requires planning. Think about how you will increase revenue once you have more time to invest in your new business. Are there other areas into which you can expand? How do you plan to diversify your client base? Also, make sure you have enough savings to fall back on while your business gets off the ground. By treating your side-hustle as a serious venture, you’ll be prepared for the challenges that come with entrepreneurship.
5. You’re spending every waking moment on your side hustle
If you’re spending all your free time on your side hustle and love every minute of it, that’s a great indicator. “Going full-time is going to give you back a huge chunk of your most productive time, and even more importantly, it gives you space to really focus on the business instead of the constant inertia of switching between your day job and your side hustle,” shares McPherson. If you’re beginning to find that working two jobs isn’t sustainable, maybe something has to give at your day job. Even if you’re not ready to make a complete shift, you could consider talking to your manager about reducing your hours.
If you just got laid off, it might be a sign that you’re meant to be your own boss. Times of crisis are often the best time to start a new business or go all-in on your side hustle. And there’s another silver lining, according to McPherson, “if your business could be attractive to venture capital, there is no shortage of good early-stage investment funds who thrive during recession periods.” One example is UBS, which just launched a $200 million venture fund to invest in early stage fintechs.
So, if you’ve done your homework and see a viable opportunity, take it. As the great Michael Jordan once said, “I can accept failure, everyone fails at something. But I can’t accept not trying.”