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How to make the transition from employee to entrepreneur

By January 14, 2021No Comments6 min read

Peoples’ paths vary greatly when making the transition from employee to entrepreneur.

Having observed and listened to countless people who have successfully made the transition, some paths are more common than others.

Methods of transitioning from employee to entrepreneur

This table showcases five common methods of transitioning from employee to entrepreneur, ordered from low to high in terms of financial risk.

*this data is by no means scientific but a reasonable base to work off

MethodFinancial ImpactStrategyEst. Hours Available per weekEst. Transition Time to full-time entrepreneur
1Skill AcquisitionLowLong-term153 or 4 years
2Working on idea evenings and weekendsLowLong-term153 years
3Part-time EntrepreneurMediumMedium-term301 year
4Taking the plunge pre-revenue/investmentHighImmediate601 Month
5Acqui-entrepreneurshipVery HighImmediate601 Month

Skill Acquisition

Skill acquisition occurs when someone makes an active decision to start learning new and valuable skills.

Deciding to spend your available hours on skill acquisition:
– is low risk
– can have positive side effects on your employee career trajectory
– eventually can lead to you running your own business

What happens when you’ve acquired the valuable skills:
1) the acquired skills can be used to build, market and sell products when working on future business ideas
2) other times, people become freelancers/consultants and base their business on selling time for money using the valuable acquired skills

Podcast episode here called “Building a $38k/Month SaaS Business as a Solo Founder with Jordan O’Connor of Closet Tools”

Working on Ideas on Evenings and Weekends

Working on new business ideas during evenings and weekends has its pros and cons.

– the safety of a full-time income allows you to be experimental with your ideas
– typically it’s quite fun and somewhat pressure-free

– most of your life is spent working during this period
– it can take a long time to hit upon something that works

Some tips here:
– If working on a big idea (e.g. AirBnB, Deliveroo type platforms), you most likely won’t have enough time to make significant progress in your evenings and weekends alone.
– Smaller ideas like info products (online courses, eBooks, blogs) or single product companies are more feasible to bring to profitability while also working full-time

Part-time Entrepreneur

Don’t want to spend all your time working a full-time job and simultaneously working on a company in the evenings and weekends? A good move can be to reduce the days you work for your company.

Working 3 or 4 day weeks will free up time (and energy) to work on your new business.

This is quite a common path if you’re building a freelancing/consulting business as it takes time to generate a client base big enough to warrant a full-time commitment.

Taking the plunge pre-revenue

Taking the plunge pre-revenue involves quitting all employment before your business operation is in motion, when generating €0.

This tactic suits people who prefer to work under pressure.

It’s high-risk financially however and can result with you back living with your parents (like it did for me in 2018).

Regardless of the volatility of this move, it can greatly accelerate your transition to full-time entrepreneurship – it just won’t be a smooth ride!


This type of transition from employee to entrepreneur is the least common.

Acqui-entreneurship involves acquiring a business which is already turning a profit and then running it full-time. The aim is to put your efforts into growing the business and make a big return on investment.

There is an amazing platform full of these types of businesses for sale called Flippa. You’ll have a lot of fun browsing it.

The financial risk of this move is obviously that you’ll have to commit a certain amount up-front to buy a profitable business.

More detail
Blake Hutchison explains all the factors that go into valuing these businesses for sale (e.g. monthly profit, business age etc.) in this podcast episode.


The transition from employee to entrepreneur doesn’t just happen. It will require discipline and the willingness to put in disproportionate work in the early years.

The important thing to remember is that although the transition can seem like a distant dream in your mind, it is achievable with whatever method you choose.

Thank you for reading,

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