Part 4: My Best Employee Wants to Start Their Own Business
When you surround yourself with intelligent, high-quality service business professionals, it’s inevitable. Eventually, one of them is going to want to try to start their own businesses.
If you’re in this particular situation currently, we have a checklist for you to go through to make sure they’re making the right decision, and if you can benefit from it.
Before responding publicly to the employee’s current decision, it’s important for you to ask yourself the following questions…
Are they ready?
Since you will undoubtedly have some kind of client crossover, you want to make sure your employee is ready to take the big jump into entrepreneurship.
Any work their company does could reflect on yours, whether either of you like it or not. It’s best to make sure they understand the ins and outs of business management and running a company before they leave.
Can you replace them
Is it worth attempting to retain the employee any further? Or is it best to let them spread their wings?
There’s no real objective way to measure the costs and benefits of this question. It’s mostly your personal opinion on the matter. Only you can decide if your company is ready to move forward without the employee or if it’s worth trying to keep them for any amount of time.
Will they be competition
This is probably your biggest concern. While you want to see them succeed in their new business, you definitely don’t want them to cut into your bottom line.
This is where business integrity, honesty, and professionalism play a huge part again. Since they were your best employee, it’s likely they handled some accounts directly over the years. If they want to handle these accounts moving forward, it’s of the utmost importance to discuss these details in the here and now.
The worst thing that could happen is that a few months or years down the line, you end up competing against each other for the same customers. If you’re really concerned about this, you can consider getting them to sign a non-compete contract as a contingency to any severance package they may be receiving upon leaving the company.
Could you partner
Could you possibly be affiliates or have partner companies together? Perhaps negotiate a referral program together?
This arrangement works best if you’re in similar yet non-competing niches. If you’re both plumbers, that could be a problem. However, if you’re a plumber and your former employee is opening a bathroom renovation company, partnering up together separately could be very lucrative for the both of you.
You won’t be able to avoid your best employee wanting to start their own business. But if you follow this simple list and honestly ask yourself these questions, you’ll be giving yourself an effective way to turn a tough situation into a positive one.