If you read this theory section in its entirety and follow the simple rules, I can’t imagine why you’d regret giving this a shot.
If your business doesn’t take off, you’ll have lost time, maybe some money, but gained it back tenfold in new skills and shareable experiences. You’ll probably also meet some incredible people along the way.
Parallel entrepreneurs like to find and help each other. Once you put yourself out there, you’ll see.
Here are seven reasons to be a parallel entrepreneur. I’ll cover each of them in detail.
- Develop new skills so you de-risk your career. There’s a price to pay for specialization. The more skills you have, the easier it will be to weather a major economic shift.
- See the forest and the trees. You’ll see your day job through a new lens when you spend time working on something else.
- Explore a new career. If you’re not sure your current job is right for you, dip your toe into a new career by exploring a side project while you maintain the comfort of your regular paycheck.
- Pursue a passion. If the skill you develop in your side project isn’t marketable, that’s okay too. Do it if you enjoy it.
- Make yourself more marketable for transfers. You may find a new career within your current company. That’s also an accomplishment, and the fastest way to get there is to teach yourself those skills by running a side business.
- Structure your evenings and become more productive. Side businesses force you to use your time wisely. This skill will help you in all aspects of your life.
- Gain financial leverage. You can also start a side business simply for the extra money. When you don’t need someone else to sign your paychecks then and only then can you call your own shots.
1. Develop new skills so you de-risk your career
In Rich Dad Poor Dad, Robert Kiyosaki writes, “The most important specialized skills are sales and marketing.” He mentions this several times throughout his best-selling personal finance book.
Most people don’t get the opportunity to develop sales and marketing skills. They’re too busy running something, whether it’s an Excel spreadsheet, an espresso machine, or a research project. That’s what most jobs are: a narrow set of activities in which you entrench yourself throughout your career. You become specialized. The problem with specialization is that your skills may not transfer very well when you lose your job.
It should therefore be no surprise that the most common reason people become parallel entrepreneurs is to develop a new skill set and de-risk their careers. More than two-thirds of the individuals I interviewed gave this response.
The first thing you’ll discover as you dive into starting your business is the sheer breadth of skills needed. I started Toofr because I wanted to learn web software development. I didn’t know that it would also improve my writing, digital marketing, and public speaking skills.
The more time you spend starting and running your own business, the more professional “merit badges” you earn. The more merit badges you earn, the more valuable you become, both inside and outside of your day job.
So rather than paying for classes at a community college or quitting your job to join an incubator, use your current paycheck to finance your entrepreneurial ambitions. Use your current paycheck to give you the freedom you need to learn and build.
This way you can work for years to build your business on the side and build a great foundation all while benefiting from the security of a full-time job.
Don’t feel guilty about it, either. The skills you’ll develop on this journey will benefit your employer too.
Rapid new skill development is the top reason to start a new company while you’re already working full-time.
You might be surprised to find that the most common set of skills that parallel entrepreneurs have isn’t coding and product development. It’s writing blog posts and building and analyzing financial statements and models.
Roughly one-third of parallel entrepreneurs I interviewed know how to query a database. If that’s not something you want to learn, that’s okay. You don’t have to. Even fewer can build a website application themselves.
Every single one of them can write their own blog posts, though. Most could write their own ebooks. Nearly two-thirds are comfortable enough with Excel and financial software to build revenue and financial models to use to run their businesses.
Those financial skills are the most common and arguably the most valuable to your business. You can outsource the bookkeeping and financial statement development but you can’t outsource the ability to understand your own business quantitatively. If you don’t have that skill now, it’s something you can learn. Take an online course or ask a friend who knows how to use spreadsheet software. Regardless of where you ultimately land, whether it’s at your own company or someone else’s, a working knowledge of Excel or Google spreadsheets will make you more valuable, increase your salary, and improve your ability to succeed.
These are skills you need. If you don’t have them already, a great way to learn them is by trying to set your own entrepreneurial destiny.
2. See the forest and the trees
The counterargument to “focus, focus, focus” is that myopia can sap creativity. More commonly, you’ll “miss the forest for the trees.”
Sometimes you need to take a few steps back and take the long-range view in order to see your business in a new way and gain valuable, game-changing insights.
I’ve found that the best way to do that is to have another professional project running simultaneously. Toggling back and forth between projects is a great way to force yourself out of your old way of thinking. When you have to change contexts and wrap your mind around a completely different business problem for a few hours, you’ll find that you’ll see the first problem in a completely different way.
To illustrate this point, I’ll tell you about a very important business model change we were considering for Scripted, my investor-backed marketplace for written content.
I really wanted Scripted to have a software subscription. This revenue model was just beginning to bring in meaningful income for Toofr, and I knew that Scripted could do even better because of its resources, brand, and my team.
But just mentioning this concept at my office job elicited rolled eyes and raised eyebrows.
Everyone was either a nay or an abstention on this one. I couldn’t get a single ally. It was a touchy subject because the implications were huge. Everyone was right about that. A subscription model would change every part of our business and make some teams obsolete. It also would sink our revenue temporarily while the subscriptions grew.
At the time, Scripted made money by taking a large percentage of the marketplace transaction between businesses that purchased writing and the writers who sold it. Often this high transaction fee rubbed people the wrong way.
If we moved to a software subscription model we could lower that transaction fee by eighty or ninety percent! I knew this is what our customers wanted, but I couldn’t convince anyone that it made business sense.
Yes, it might cannibalize our other revenue. Yes, it might upset the sales reps. (I was sensitive to this because I managed the sales team at the time, but I wanted to try it anyway.) Yes, it could lower our average revenue per user and throw our unit economics out of whack.
I still advocated for the flexible, month-to-month subscription model because I saw that our traditional sales-driven enterprise approach was not working. Our customers didn’t want to purchase our writing with lengthy, verbose contracts. The customers who signed, and we did get a lot of signatures, would not renew. The numbers were telling the story but my team didn’t want to change.
I said in meetings that not giving our customers what they wanted was wrong. We had to listen to them and then figure out how to make it work. Conversation would ensue, and the conclusion would always be made that my idea was too risky, would create too much change, the board would never approve it, and that we shouldn’t give up on the status quo yet.
One afternoon, in the midst of all of this, I was sitting in a conference room with our product manager. We had just gone through another grueling series of meetings debating the features and pricing for our newest contracts. We looked at the whiteboard full of notes and I said, “I promise you, we’re eventually going to be a simple monthly subscription company. It’s going to happen.”
Then he laughed. I laughed too. We both laughed. Sadly, when we shifted to the monthly subscription model a few months later, he was one of the guys we had to lay off.
Eventually I was able to convince our stakeholders of the wisdom of the subscription model. Today, Scripted is stronger than it’s ever been. Monthly recurring revenue has tripled in the preceding year and the business is profitable.
Moving Scripted to a subscription model was the right move and I have Toofr, my little side project at the time, to thank for that insight.
3. Explore a new career
I’m now in my mid-thirties. My friends are too, and many of them are feeling stuck in careers they chose after college or after graduate school, and they’re realizing they’re too old to make a switch.
Your thirties are when your income is supposed to accelerate. As my friend and author, Max Altschuler, writes in his latest book, Career Hacking For Millenials, “Your twenties are for learning. Your thirties are for earning.” You get more raises and promotions in this decade than any other point in your life. Sacrificing that gravy train for a shot in the dark in a new career could be disastrous.
So they stay in jobs they don’t like and waft back and forth between numbness and misery. That doesn’t sound like a life any of us want to live.
And there’s no reason for it. You can have your cake and eat it too!
Let’s say you’re working in public policy but have always wanted to be an interior designer. You’re doing really well at your job. Great boss, great pay, great perks, and you actually like the work, but it’s not what you would do if you could choose a career all over again.
What are your options? The How To Do It section in this book has the details, but the teaser is simply to just… do it. Get immersed, start building a brand, and find the intersection between what you love and what other people need. It will take you some time to find it, so you might as well do it while you’re getting paid by somebody else.
Importantly, interior design and public policy have nothing in common, so they work in parallel. Remember that when you work for someone else, you have to maintain a fire wall. When you’re working at your public policy job and taking their paycheck, you cannot do anything with your side job. You must do it on your free time.
You’ll read in the Staying Out Of Trouble section that keeping your side projects separate from each other is critical. You can’t start your own public policy consultancy while you’re working at a public policy company. That will eventually create legal friction and backfire.
When you’re the owner of both your day job and your side project, you can seek out synergies between the two. We’ll cover this distinction with some real examples from the entrepreneurs I interviewed.
Most of the time there’s no reason why you can’t put the building blocks in place to not just explore a new career, but to start a new business while still getting paid in your day job.
Case Study: John Zimmer, Co-founder of Lyft
John Zimmer studied hospitality management at Cornell. He graduated in 2006 and joined Lehman Brothers in order to get a better finance background, but during the first year of a two-year analyst program he became bored.
When Logan Green, a friend of a friend, posted on Facebook that he was building a carpooling website, John got interested. A course he had taken in college emphasized that overconsumption of resources will ultimately threaten human survival. The lessons stuck with him but he wasn’t inspired yet to work on a solution. The carpooling service idea struck a chord.
At the time, Logan was in Santa Barbara and John was working in New York City. The two connected online and met for the first time in person when Logan traveled to New York a few weeks later. They hit it off and decided to collaborate on Logan’s idea.
John stayed at Lehman Brothers for another year while Logan built the website and John hammered away on marketing campaigns and partnerships at college campuses. He kept his day job while working on a side project that had no overlap or potential conflicts.
In 2008, when Zimride, the carpooling site, was running and making money, he quit Lehman Brothers.
Friends and family thought he was crazy. “Why would you quit on a sure thing like Lehman?” they’d ask.
Three months later, Lehman Brothers went bankrupt.
As COO of Zimride, John Zimmer is now a major shareholder of a business with 1,500 employees that is worth north of $5 billion.
4. Pursue a passion
Another rationale for parallel entrepreneurship is simply to explore a passion. Since half of the parallel entrepreneurs I interviewed gave this reason for starting a second or a third business at once, I’m going to share two stories.
Josh Pigford is the founder of Baremetrics, a Birmingham-based software company that captured the subscription analytics market by storm. Josh is one of my favorite parallel entrepreneurs. I love his writing and respect his business philosophy.
Since he launched it in 2013, Josh’s business has consistently grown about 50% every year. His annual revenue is now over $1.1 million. Not bad for a business that has raised only $800,000 from outside investors and still runs lean with a small team.
Josh’s story is particularly interesting during the time prior to launching Baremetrics, when he was essentially a serial parallel entrepreneur. He’d start and stop dozens of businesses, which ranged from consulting projects to software applications. Baremetrics, in fact, was one of those many businesses that Josh was inspired to build back in 2012 and 2013.
It was because of his experience starting and stopping multiple businesses that Josh could tell Baremetrics was different.
“It was like, ‘Oh, so that’s what it feels like to have something that just works!’” he told me.
Baremetrics, unlike his other ventures, saw immediate fast traction. Soon it consumed all of his time, so he folded his other ventures and for several years was dedicated completely to Baremetrics.
Then, in January 2017, I saw this tweet from Josh:
“I’m launching a super non-digital thing this month: @CedarandSail! Stay in the loop + get 20% off when it launches: http://cedarandsail.com.”
The tweet included several pictures of small, geometric plant vases.
Why would the CEO of a hot software startup publicly launch an e-commerce company? I was curious, so I asked him.
He told me it’s because he loves the products. He writes on the Cedar & Sail blog, “Separate from business, I make a point to do things that aren’t digital…things that require me to use my hands and build actual, real, tangible objects. That manifests itself in everything from gardening to woodworking to electronics to designing home decor.”
You don’t start a handmade craft business in order to scale rapidly and make a bunch of money quickly. It doesn’t work that way. Josh also acknowledged to me that there is no synergy between Cedar & Sail and Baremetrics. None.
But that’s what it means to have a passion project. He’s not doing it for fortune or fame or any reason other than simply because he loves it, it makes him feel good, and it’s an outlet for the roller coaster ride he’s on at Baremetrics.
In a previous example I described someone who was working in public policy and was passionate about interior design, so she started a blog. There’s a clean, clear line between public policy, which is her day job, and interior design, which is her parallel entrepreneurship project. They have to be separate because of legal consequences with her day job.
Josh’s case is different. He’s the CEO of Baremetrics and also the CEO of Cedar & Sail. He therefore could blend his projects together a bit, perhaps by selling to the same customers or using the same software. Many parallel entrepreneurs I spoke to scaled up multiple businesses simultaneously by riffing them off of each other.
Again, when you wholly own all the businesses you’re working on, you can do that. Josh could have done this too, but instead, he kept them separate simply because he’s passionate about building beautiful physical products.
Max Altschuler took a similar parallel trajectory. He’s the CEO of Sales Hacker, a media company that hosts conferences on multiple continents and is a fast-growing content destination for information-hungry sales and marketing professionals. He has a small team with revenues north of three million dollars a year.
Let’s start at the beginning of Max’s career with Sales Hacker. I know it well because I was there.
I met Max via email when he messaged me in late 2012 about a couple of articles I wrote on the Scripted Blog titled “Hacking for Sales.” Max was working at the time in Business Development at an online course startup called Udemy.
I filled these posts with programming code to pull names, emails, and other data from public websites that might be useful in email campaigns. He liked them and encouraged me to develop them into a course to host on Udemy. I balked but we became friends and started hosting dinners and meetups with other technology-minded sales people in San Francisco.
The interest grew and Max saw an opportunity to expand our group beyond the handful of regulars and into the broader sales and technology community in the Bay Area. In November 2014 he hosted and organized the very first Sales Hacker Conference. It was magnificent, well-attended in a beautiful theater close to the vibrant North Beach district in San Francisco.
Max sold the tickets, got the sponsors, and lined up the speakers. The rest of us just watched and enjoyed the conference. He would go on to host another conference, and then another, and then he did them in Europe and partnered with other sales training organizations to have smaller meetups similar to the early days of our friendly sales hacker group.
He built a team and the revenue kept growing. Just over four years after launching that first conference he is financially free, traveling to and working from anywhere in the world.
So what would compel him to start SUTRA, a natural, energy-boosting alternative coffee product? It’s simple. Passion.
As he put it, “I quit drinking coffee since it was killing me, so I built an alternative.”
It’s also a pattern in Max’s career. When he launched that first Sales Hacker conference he wasn’t doing it full-time. He still had a job at another startup as leader of its business development team. And while he was making a lot of money running Sales Hacker, he saw opportunities to invest in sales technology companies and cryptocurrencies. He built several significant parallel income streams.
SUTRA is merely an extension of that trend. He loves the challenge of building a physical product and adapting his many years of hustling in sales and marketing to help SUTRA enter the very competitive beverage market.
I have great respect for Max and Josh. They both founded successful online businesses and passion caused them to throw their hats into the offline ring too. They are true parallel entrepreneurs.
5. Make yourself more marketable for transfers
Taking the policy and design parallel story a bit further, let’s say you dove into interior design for six months and either determined that the interior designer market is too saturated or you’re just not committed to seeing your new career in interior design all the way through.
But you discovered that you love social media. In the process of immersion, you discovered how to use Instagram and Twitter and interact with strangers in ways you never knew were possible. You then noticed flaws (or just a downright gap) in your employer’s social media strategy.
You strike up a conversation with the marketing team at work. You didn’t know them before, but now you’re friends. It turns out there’s budget to bring someone on to manage your employer’s social media accounts full time.
You describe what you’ve been doing in the interior design market, what your ideas are for your employer’s accounts, and you get the job.
It wouldn’t have happened if you never tried to be a parallel entrepreneur. If you’d never set out to explore, you’d still be wafting back and forth, back and forth, back and forth.
6. Structure your evenings and become more productive
About a third of the parallel entrepreneurs I surveyed were able to keep their day jobs and find time at nights and on weekends to develop other income streams. The most common sources of that extra income are investments like real estate, startups, stock, and cryptocurrencies.
As Kiyosaki suggests in Rich Dad Poor Dad, becoming rich is as simple as taking whatever is left after you’ve paid your monthly bills and putting it into assets that generate cash. You can start by buying stocks. When you’ve accumulated enough money, you can buy a multi-family house, renovate it, and rent it. And with some good planning and a little bit of luck, in a couple of years you might earn a 50% return and do it again.
At this point you may be able to quit your job or reduce your hours to put more time into your side business. Getting there, though, will require discipline. You will need to structure your non-working hours to maximize productivity. You’ll see the best results if you just do a little bit of work each day.
I personally enjoy it. Side hustling means a long, slow grind. You’re working all day and then you get home and work into the night. It suits me. I’m not an adrenaline junky. I don’t like to drive fast or ski fast or run fast. When I was into road biking I preferred the climbs to the descents. And now when I jog, it’s usually with a stroller in one hand and a dog leash in the other. I’m not moving very fast, but a long slow jog is actually my favorite type of workout.
If you love it, it’s wonderful. You’ll know if you’re meant for this path by how long you can sustain that schedule.
Does the extra work give you energy or does it sap it from you? Be honest with yourself.
Regardless of the outcome, you’ll find that your productivity increases with the amount of structure you put into your day. And when you’re your own boss, you can optimize that structure in the way that works best for you.
7. Gain financial leverage
I saved the most obvious reason for last. You can also start a side business for the money.
Kyle Duck has been an SEO consultant for a long time. I met him last year when I was researching new growth channels for my business. We became internet friends and I became one of his first customers for a new SEO product he launched. It’s called Alli AI, and by using it I have dramatically improved the organic traffic to my sites.
Prior to building Alli, Kyle was an SEO and growth consultant. He taught himself software development so he could improve his SEO consulting abilities. He spent a decade consulting and honing his knowledge of SEO, what works, and where the opportunities for automation are hidden. He came up with Alli to streamline his consulting and get financial leverage through passive income.
“I always wanted to build something scalable that I could live on,” he told me. “I always wanted to have passive income and develop new skills from growing that income.”
With Alli open for business, Kyle is well on his way. He passed $1,000 of monthly recurring revenue (MRR) in his first month after launching, grew to $4,000 the following month and is on track after just four months to break $10,000 MRR. He’ll soon have enough passive income flow to focus on building a very large business, which is his ultimate goal. Without funds to hire engineers, Kyle will have to build that business himself, which will take time. His SEO software opens up the time he’ll need to build it.
That’s the financial leverage I’m talking about. One passive income stream is great. Two passive income streams is much, much better. It means you can sell the first one, liquidate it, pay down your mortgage, and you still have money coming in.
Once you’re comfortable with one stream, you don’t put up your feet or play golf. Instead, you start another one.
That’s the parallel entrepreneur way.