Is the idea of entrepreneurship calling your name?
According to our 2022 Independent Salesforce Consultant Report, you’re not the only one – 40% of independent Salesforce consultants started their own business during the pandemic between 2020 and 2022.
Independent consultants are a rapidly growing segment of the Salesforce talent population. If you’re thinking about betting on yourself, this is your time. Customer demand skyrocketed last year, and there’s no sign of slowing down – there’s plenty of project work for everyone.
Is the independent lifestyle for everyone?
The “ah-ha” moments and motivations for going independent vary from person to person, but there are amazing benefits nearly every expert stands to gain. This year’s top-cited benefits included flexibility, the guarantee to work remotely, earn more money, and the freedom to choose projects. Going independent makes room for all those things and more.
However, the reality is entrepreneurship isn’t a walk in the park. There are going to be times when money dries up, flexibility isn’t an option, or you’re working more hours than planned. To create a roadmap that will guide you through the challenges of entrepreneurship, define your “why” for going independent. Establishing a strong ethos is the key to success.
Starting an independent business may sound daunting. However, when it boils down to it, there are only four steps to make it a reality. Here is the framework for establishing an independent Salesforce consultancy.
Find the right circle of advisors
In addition to finding mentors – trusted peers to run scenarios by and entrepreneurs who have walked the walk – it’s important to have a go-to network of specialized advisors. They will play a crucial role in your support system and help with strategic decisions.
A good CPA will help choose the right business structure – s-corp, LLC, etc. – with certain tax implications and project income in mind. CPAs also help with estimating quarterly taxes, how to save for those tax bills, and general tax strategy.
Being the boss also means absorbing all of the risks that come with doing business. Some customer SOWs and MSAs have specific insurance requirements – errors of omission, commercial coverage, etc. – that standard homeowner insurance won’t cover. Business insurance is an absolute must. An insurance broker can identify the right insurance and appropriate coverage necessary to ensure you’re not at risk.
Contracts need to be tight in the interest of your business and services. Get a trusted business attorney on retainer that can help draft and review client contracts.
User group meetings and in-person events are trickling back. This is great because even the most ardent remote-work fans need to get out and connect with people every so often. For business and sanity, it’s beneficial to nurture relationships in person. It’s also an opportunity to learn, help others, and practice vulnerability, too. That’s where growth happens and new connections are made.
Establish an official business entity
Establishing an official business entity – LLC, S corp, etc. – solidifies an official transition to entrepreneurship. It also symbolizes the commitment to independent consulting as a full-time job. Taking this step may feel scary at first, but it’s also part of the thrill!
An established business entity is also a non-negotiable formality for many potential customers and partners. They want to work with experts who are protected from liability and can provide a non-personal social security number. A business entity also signals to customers that a long-term partnership is the goal. They can enter into a contract or project feeling confident they won’t be left hanging after three months because entrepreneurship didn’t pan out.
Refer to your financial and/or tax advisor to decide between an LLC or S corp. There are important tax implications and business aspirations – subcontracting, hiring employees, how to pay yourself – to consider.
Separate personal and business finances
With an official business entity in place, it’s time to get the financial back of house in order. Choose a trusted financial institution to open an official business checking and savings account.
It is crucial to keep personal and business finances entirely separate. Intermingling accounts and their activity – personal and family expenses, business expenses, business income, etc – will inevitably create a nightmare when it comes time to file personal and business tax returns.
Create a contingency plan
If we have learned anything since 2020, it’s that life is unpredictable. No amount of research, foundation-building, or financial planning can insulate business owners from the inevitable curveballs. Contingency plans provide peace of mind and actionable steps in the event business doesn’t go according to plan A.
Start with ensuring financial security. It’s ideal to start the entrepreneurial journey with 3-6 months of emergency expenses saved up somewhere where it can’t be touched. Pretend that money doesn’t exist. That way, if a client doesn’t pay an invoice or steady work dries up, the business has a chance to survive.
It’s also important to keep service positioning flexible. The Salesforce platform and market demand are constantly evolving, so consider the top three skills you bring to the table. React and adapt accordingly to net new clients and maintain a healthy pipeline of business.
Finally, know when enough is enough. It’s okay if the business doesn’t work out or the entrepreneurial lifestyle isn’t a fit. It’s a safe bet to go independent because there is always an opportunity to go back to full-time work. We all have responsibilities – rent, families to support, food to put on the table – and there’s no shame in pivoting back to traditional employment.
If you’re a Salesforce consultant thinking about taking the leap to independence, we’d love to hear from you. Learn more about how 10K helps bridge the gap for independents in their first few months of business and other success stories.