Starting a business while working full-time: 10 benefits

Imagine building your dream business without giving up the financial stability of your full-time job. If you’re ready to pursue your business idea or a current side hustle, but fear taking the plunge, you don’t have to quit your full-time job. In this article, the experts at Rapid Formations – one of the UK’s leading company formation agents – highlight 10 benefits of starting a business while working full-time and give advice to budding entrepreneurs.

Can you start a business while working full-time?

The answer is yes. Many successful entrepreneurs built their businesses while still employed. Take Jack Dorsey. He was a web developer for a podcasting company when he came up with the idea for a platform with real-time updates, otherwise known as Twitter. At the podcasting company, he made connections with Christopher ‘Biz’ Stone, Evan Williams and Noah Glass, who became his Twitter co-founders. If you want to build something significant but have hesitations around jumping straight in, starting a business while employed full-time can be a smart idea.

10 benefits of starting a business while employed

1. Financial stability

Maintaining a steady income is a major advantage of staying in your full-time role while setting up a business. Think about the expenses when starting your own company – these are likely to increase as you develop it, so having a regular income stream is beneficial. If you have personal responsibilities, such as being a primary caregiver or supporting a family, keeping your full-time job while starting your business alleviates the pressure of monetising your company straight away.

2. Build capital

Investing money into your business, especially during the early phases, is essential. If you start your small business while still employed, you can reinvest your earnings to help kick off and fund it. You’ll need to invest in resources, such as software and equipment, too, and you may wish to hire experts or outsource tasks to focus on higher-impact activities.

3. Test the business idea with lower risk

Starting a business when working full-time lets you take risks you may not be able to if you rely entirely on your new business’s income. Even if it means working during your lunch break, evenings or at weekends, you can test whether there’s a market for what you’re offering or selling without committing a lot financially. You can also afford to talk to your target market and get validation that people are interested in your products or services.

4. Efficiency and innovation

Many ambitious individuals will wonder how to start a business while working a 9-5. When will they get the time to work on their new venture? This may seem stressful, however, the advantage of limited time is that you become savvy with your prioritisation and time management. You will be more naturally inclined to use your precious hours efficiently rather than wasting effort on unimportant tasks.

5. Have a personal safety net

If you’re in full-time employment when starting your business, you can still access your employer’s resources. Health insurance, for instance, can reduce personal risk during this critical time, while paid leave means you can take time for yourself to avoid burnout.

6. Develop soft skills

Don’t overlook the skills you can build while still working full-time. By managing two roles, you’ll naturally develop key entrepreneurial skills. Balancing a full-time job with starting a new business boosts your confidence, builds your resilience and hones skills such as adaptability and problem-solving.

7. Flexible business planning

Many entrepreneurs stay in their full-time roles initially so they can take more time for planning. Having a financial safety net lets you make important decisions without rushing, which can happen if you need to generate profit immediately. You can also use this time to establish ways of working and routines that suit you, such as setting boundaries and identifying when you’re most productive.

8. Personal fulfilment

If you have a hobby that you would spend time on outside of work anyway, it makes sense to want to make money from it. Continuing your full-time job provides a safety net for experimenting. It also means you can explore your passions or business ideas without the pressure to succeed immediately, often leading to greater personal fulfilment.

9. Networking

It’s wise to build relationships with coworkers and your employer when starting your business. You never know who could help you along the way or even become future customers or advocates of your business.

10. Emotional security

Going ‘all in’ and quitting your job to focus solely on your business can be stressful. By staying in your job and building your business on the side, you can learn, make mistakes, and refine approaches or ideas without the financial anxiety. Plus, having to strike a balance with your current job means you’re less likely to burn out from the demands of 24/7 entrepreneurship.

How to balance full-time work and your new business

1. Time management

Time management strategies are your best friend when managing two roles. Leverage productivity tools, such as Wrike or Asana, and install scheduling applications to help dedicate sufficient time to your full-time work, new business and personal commitments. Consider hiring freelancers to outsource work once your business gets off the ground and use a company formation agent to support with administrative tasks.

Rapid Formations offers a cost-effective, basic company formation package, which lets you register your new limited company. It also includes submission of your first Confirmation Statement to Companies House, so you don’t miss the filing deadline.

2. Set boundaries

Establish boundaries from the get-go – both physical and mental. Ensure your new business tasks don’t interfere with your full-time job and clearly communicate your availability to those in your professional and personal spheres. Remember to preserve time for yourself, too. Sleep, regular breaks, exercise and time for other hobbies will be more important than ever.

3. Build a support system

Friends, family, partners and mentors are an invaluable support network. Don’t forget to foster this – you’ll need it when challenges arise and you’re under pressure. Equally, they will celebrate milestones with you and provide encouragement along the way. You may wish to join an entrepreneur support group, too, to gain advice and meet like minded people.

Tax implications and legal considerations

Do you need to tell your employer if you start a business? We strongly recommend being transparent with them. Reassure your employer that your side venture won’t impact your performance at work and stay professional – avoid using company resources to perform business-related tasks and keep business conversations separate.

While no law prevents employees from starting a business, you must read your contract carefully to avoid potential conflicts of interest or violations of clauses. If your contract does include provisions that stop you from taking on a second job, consider seeking legal advice.

Finally, there are tax implications of starting a business while still employed. The amount of tax and NIC you’ll need to pay will depend on your combined annual income from your main job and your new company.

Planning for full-time work to full-time business owner

Ready to transition to full-time entrepreneurship? As well as steady revenue and a clear trajectory for your company and involvement in it, you’ll need to feel ready personally for this move and to have a financial safety net of savings (covering at least the first 6-12 months). Fortunately, business mentors, financial advisors and company formation agents can support with setting your business up for success.

Take the first step to entrepreneurship by contacting the team at Rapid Formations. From registering your company to reserving your business name, they’ll guide you through the process with ease.