Thursday, April 02, 2009

My Career - Part III - Adventures in Self Employment

This is part III of a five part series describing my career story, including the many twists and turns I have taken on my road to my current position. I have made my share of mistakes and occasionally some good decisions which all got me to where I am today. The post today is about my adventures in self employment, which took place in the first few years after I graduated from business school.

In part II of this series I wrote about how my career decisions during business school left me working for a small and under-capitalized start-up in Denver, Colorado. The CEO of this company trusted and respected me. I earned this respect by getting the company its first multi-million dollar deal during my summer internship the prior year. Within a month of starting full time employment with the company I was promoted to Chicago Branch Manager, and shortly thereafter I was promoted to VP of Operations and joined the company's management team. As part of that latter promotion I was also responsible for managing about 80% of the company's staff. Talk about inflating your ego. There I was, just a few months out of business school, running a 50 person team. Of course, I was woefully under prepared for this role. I had never managed a budget before or a team of that size and complexity. I made some pretty big rookie errors. However, the nature of the company was such that I was actually more qualified than most members of the executive staff. Yes, that IS bad. 

Within months, it became apparent to me that the company was going to run out of cash. We had a couple of incredibly large contracts for a company our size but we did not have enough working capital to deliver on our commitments. You see, working capital is the money that you need to spend to deliver goods and services. Unless your customers pay up front, you use your working capital before your customers actually pay you. We had clearly grown beyond our ability to finance our operations. I raised the alarm, and pushed aggressively for a resolution, but in the summer of 2002 it became clear that I was fighting the tide. I resigned and later found out that two months later, the company had to let go of about 70% of its employees.

I am not proud of my track record in this company, but this was one of my most important learning experiences: I learned to accept the limits of my skills and experience. I learned I needed to be forceful and vocal when I spotted a critical problem. I also learned that the most important thing about a company is its management team - if the management team is not qualified for its job, the company will fail. Always.

Now, I was unemployed. I also had a newborn son, and was facing the dismal prospect of looking for a position in Silicon Valley, in the middle of the dotcom bust. This was not good. I also learned that MBAs have a pretty short expiration date - while you are being recruited at a top business school, you are king of the hill. Companies chase you down and throw offers and signing bonuses in your direction (for the most part). Looking for a job as a newly minted MBA? Not so good. After a few months on the job hunt I was discouraged. I was getting no-where and getting stressed. I was starting to doubt my decision to resign my former position. I was even entertaining going back to being a lawyer... but only briefly. That profession was simply wrong for me.

Instead, I decided to open my own business. My reasoning went as follows: I know how to do deals, big and small. In my previous company I was able to get a multi-million dollar deal signed within months. I could repeat the process as a consultant. I would hire out my services to a certain kind of high-tech company and help them find their first customers, for a small monthly fee and a large success based fee. I ran my business for about 2 years. My revenue increased every single month of this two year period, but still, my overall income was much smaller than what I could be making as a full time employee and the hours were a bitch. More importantly, I realized another something about myself: I hate working on my own. I need the company of co-workers, team members and managers to feel happy. Working alone from my home office was not working for me.

Once again, it was time to make a change. This time I would finally find myself headed on the right track, although it certainly did not feel that way when I started down that road.

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1 comment:

frugal zeitgeist said...

This is a great story. I can't wait to see what happens next!