How to Become Your Own Boss

Vincent Porpiglia is no stranger to sleepless nights. Afterwards graduating from college while a recession with few job prospects, he was tossing and turning one night when he came up with the idea for Dream Water, a natural liquid remedy for insomnia that he in the end developed and perfected. With partner David Lekach, a former investment banker and fellow insomniac, Porpiglia launched Dream Products in 2009 and began selling Dream Water in Duane Reade drugstores across New York City. Today, Dream Water is sold in 15,000 stores nationwide, including Walmart and Walgreens. During the private company doesn't release its revenue figures, Dream Products is on track for 350 percent growth over 2010 revenue, which was in the low seven figures.

Like Porpiglia and Lekach, scores of people dream of leaving behind the limitations of the corporate world to become entrepreneurs. Nevertheless starting a business can be daunting, and many never get beyond the dreaming stage. Want to start making actual progress on the path to entrepreneurship? Here are six steps to get you moving in the right direction.

1. Check your passion. It's not enough to simply want success. Entrepreneurs who make it are as well passionate about their businesses. "Make sure you are not chasing money, however you are chasing a passion," says Michael Hall, managing partner of Fort Lauderdale, Fla.-based marketing agency MediumFour. "The passion has to be something instilled in you, because you will experience many ups and downs with business. If it comes to just being about money, you have a better chance of giving up when things get rocky."

Hall says the best way to determine whether you're passionate about your potential business is "if you get that tingly feeling, or that 'I could do this every day' feeling, when you are working on a project or an idea."

2. Make a financial plan. One of the most important ways to prepare for leaving your job and launching your own business is to make a detailed plan for your finances while the startup phase. Rohit Arora, CEO of Biz2Credit, which helps startups secure financing, recommends having enough savings to get you through until further notice nine to 12 months previously getting your business started.

The first year is very important

"The first year is very important, when all the money earned in the business should be reinvested without the owner needing to draw out any money as salary," Arora says. He recommends waiting about 18 months afterwards launching earlier expecting a regular salary check. While the first 18 months, you can reimburse yourself for operating expenses, nevertheless don't expect to draw a salary consistently. If not, less money will be reinvested in the business, lowering your long-term prospects for growth.

However you plan to fund the business, keep costs in accordance with control and be careful not to underestimate how much money you'll need to get started. "You don't want to have to apply for a second round of funding until afterwards you have proven that your company is viable and has a prospect of growth," Arora says. "If you go back for money earlier having results, it makes it look like you have either not planned so then enough or have squandered the money. In either case, lenders will be unlikely to give you more money."

3. Get a partner. During Porpiglia developed Dream Water in 2007, the company never in effect got off the ground until Lekach joined the effort two years later, bringing an additional set of skills to the table. And once partners Adam Platzner, chief brand officer, and Joseph Lekach, vice president of business development, came aboard, things in point of fact got cooking.

Working alone can paralyze many would-be entrepreneurs, so consider getting a partner or two to share the workload and the risk. "No one is good at everything," says Matt Spradley, who has launched three successful research startups and is currently CEO of image-based electronic signature provider Vignature. "Even if you are a jack of all trades, there isn't enough time for one person to do everything in other words required in a startup. It can as well be actually lonely when you're starting out. It's you against the world. You don't have the protection of the corporation. Having someone in it with you in fact helps with that burden."

Rather than partnering with someone who's just like you, look for someone who complements your skills. To illustrate, "if you are a techie, find a business partner," Spradley says. However because situations can change, sign a partnership agreement upfront that spells out a vesting schedule and how a potential separation would be handled.

4. Gather market support. Give yourself peace of mind by lining up clients for your new business previously leaving the security of your job. Life and success coach Kristi Blicharski recommends creating a list of all the people who have been supportive of you and contacting each of them personally--not via mass e-mail--to share the news of your new venture. "Include anyone who has ever said they liked working with you or would like to hire you if you were out on your own," she says. "Mention that you've enjoyed working with them and ask if they or someone they know would be interested in what you have to offer."

Position to do business with you suddenly

If there are people on your list who may be in a position to do business with you suddenly, "contact them with a customized offer and let them know you would like to work with them, even on a very small scale to start," Blicharski says. "Don't be afraid to be direct and ask straight up for their business. Share your enthusiasm. It's infectious."

Small-business growth consultant Gary Evans of DemGen, a team of specialized virtual entrepreneurs, recommends going beyond those in your network. "Develop a list of the top five [prospects] in five different verticals you are looking to pursue, create an introductory document and work out a script of the main talking points you want to get across," he says. "Call first and follow up with e-mail." He recommends setting specific goals just as reaching out to 25 people, getting five warm prospects, presenting two proposals and closing until further notice one sale.

5. Devise a marketing strategy. "The most important thing people need to know when they leave a job to start their own business is that their success will not depend on how good they are at what they do," says Dov Gordon, a small-business marketing strategist. "It will depend on how good they are at marketing and sales."

Unfortunately, when it comes to marketing and sales, entrepreneurs receive "boatloads" of bad advice from "experts" in social media, telemarketing, networking and public relations, Gordon says.

6. Listen to sound advice--and ignore poor counsel. During you must avoid bad advice that ignores the big picture of your marketing strategy, a successful entrepreneur will heed the good advice of those who have been there earlier. "Just like the things your parents told you when you were a kid, lots of people, me included, don't listen to the expert advice and take the position that it doesn't apply to them. Wrong," says Benjamin Sayers, three-time entrepreneur and current CEO of VoIP (Voice over Internet Protocol) solutions provider VoIP (Voice over Internet Protocol) Supply. "Mistakes made in creating, building and growing a business and the challenges faced by entrepreneurs are all fairly universal. Listening to experiences from others and plucking from that what is relevant to them can be helpful to entrepreneurs."

The advice you're hearing is worth retaining

To determine whether the advice you're hearing is worth retaining, consider the source and their experience. Whether you're talking with a SCORE counselor, board member, advisory board member, attorney or your best buddy, "qualify their expertise on the subject matter and their recent experience in the subject matter," says Susan Schreter, venture finance expert and founder of TakeCommand.org. "For instance, it's common for entrepreneurs to talk to business brokers and other people who might offer to help them raise equity capital for their business. Here, the entrepreneurs who want to raise money from angel investors must ask, 'What companies have you raised angel money for while the last two years?' If the so-called advisor hasn't 'been there, done that,' move on to find someone who has."