Stop building someone else’s dream on company time — it’s time to start building your own.

If you’re reading this during your lunch break or after another exhausting 50-hour work week, you’re not alone. The rate of new business owners working full-time or part-time for another employer while launching their startup business rose from 27 percent in 2022 to 44 percent in 2023, representing one of the most significant shifts in entrepreneurial behavior in recent history. As more professionals transition into entrepreneurship, choosing the right business structure early on has become a critical step in setting up a sustainable and legally sound foundation.

The corporate grind doesn’t have to be your forever story. Thousands of ambitious professionals like you are discovering that the skills, experience, and network you’ve built in corporate America are your greatest entrepreneurial assets. There are 34,752,434 small businesses in the United States, and small businesses employ 45.9% of American workers, or about 59 million people. The question isn’t whether you can start a business while working full-time — it’s how to do it strategically, legally, and successfully.

The Reality Check: Why Corporate Professionals Are Choosing to Become Entrepreneurs

Let’s be honest about what’s driving this entrepreneurial exodus from corporate America. The leading motivation for starting a new business in 2024 was the desire to be one’s boss (28%), followed by dissatisfaction with corporate America (23%). It’s not hard to understand why. Despite years of experience and expertise, many professionals find themselves hitting income ceilings, dealing with endless bureaucracy, and watching their ideas get buried in committee meetings.

But here’s what’s encouraging: 65% of small businesses are profitable, while 73% of small business owners report being happy. Even more compelling, more than 9 in 10 owners don’t regret starting their business. The entrepreneurial path isn’t just financially viable—it’s personally fulfilling. For anyone who wants to make sure they’re building a profitable business with long-term potential, the key is knowing how togrow a business strategically from day one.

Recent data reveals the scale of this movement: The years since the COVID-19 pandemic began have seen a significant and unprecedented increase in new business applications—16 million since 2021, leading to 2.8 million established new businesses. Whether you’re ready to apply for a business license or are mapping your next move, this represents the largest entrepreneurial boom in American history.

Success Stories: Proof That It’s Possible

Before we dive into the how-to, let’s look at some inspiring examples of entrepreneurs who started while employed:

Sara Blakely (Spanx): While selling fax machines door-to-door full time, Sara Blakely launched a side business to make hosiery. After moonlighting for two years, she finally quit her job when she knew that Spanx would be successful. Today, Spanx earns over $1 billion in revenue per year. What’s remarkable is that Sara Blakely started Spanx with $5,000 and was profitable from the start.

Jack Dorsey (Twitter): Jack Dorsey joined a podcasting company, Odeo, as a web designer, but then got obsessed with a product idea: Twitter. He discussed it with a colleague, Noah Glass, and with their boss’s blessing (Evan Williams), they assembled a team at work.

Daymond John (FUBU): The fashion mogul started FUBU while working various jobs, eventually building it into a $350 million company.

These aren’t unicorn stories — they’re examples of strategic entrepreneurs who leveraged their employment as a foundation for building something bigger. Research supports this approach: entrepreneurs who kept their day jobs initially failed 33% less often than those who immediately quit to pursue their ventures full-time.

Step 1: Navigate the Legal Landscape (2024-2025 Updates)

Before you write a single business plan, you need to understand your legal obligations and protections. This landscape has changed significantly in 2024-2025, creating new opportunities for aspiring entrepreneurs.

Major Legal Changes: The FTC Non-Compete Ban

On April 23, 2024, the Federal Trade Commission issued a final rule to promote competition by banning noncompetes nationwide, protecting the fundamental freedom of workers to change jobs, increasing innovation, and fostering new business formation. However, federal courts have issued injunctions blocking the rule, and under the Trump administration, the likelihood that the FTC will try to enforce this ban is minimal.

Current Status: As of August 20, 2024, a federal court in the Northern District of Texas set aside the rule and ordered that the FTC cannot enforce the rule nationwide. This means non-compete agreements remain enforceable under current law, but the legal landscape is rapidly evolving.

State-Level Protection

Currently, four states ban the use of noncompetes entirely, and 34 states plus DC restrict their use. Nearly one in five workers in the United States are bound by a noncompete agreement preventing them from finding a new job or starting a business in their field when they leave their employer.

Smart Business Advice: Always Review Your Employment Agreements

Most corporate professionals have signed several documents that could impact their side business:

• Non-compete clauses: These typically prevent you from starting a competing business while employed or for a specified period after leaving
• Non-disclosure agreements (NDAs): These protect your employer’s confidential information
• Intellectual property agreements: These may give your employer rights to inventions or ideas developed during employment

The FTC’s proposed rule makes clear that “a contractual term is a de facto non-compete clause when it has the effect of prohibiting the worker from seeking or accepting employment with a person or operating a business after the conclusion of the worker’s employment with the employer”. This includes broadly written NDAs that functionally prevent you from working in your field.

Establish Clear Boundaries

Here are the golden rules for staying legally protected:

1. Never use company resources: Don’t use company computers, software, office supplies, or time for your business
2. Work on your own time: Only work on your business during personal hours
3. Avoid conflicts of interest: Don’t compete directly with your employer or solicit their clients
4. Maintain separate finances: Open a separate business bank account and only use business funds for business expenses
5. Document everything: Keep records showing you’re following proper boundaries

Step 2: Choose the Right Business Model

Not all businesses are suitable for the working professional. The majority of small business owners – 30% – report spending between $100,000 and $500,000 just to get up and running, but this doesn’t mean you need that much capital to start. You need a model that:

• Doesn’t require your physical presence during business hours
• Can start with a minimal upfront investment
• Leverages your existing skills and expertise
• Has flexible time requirements
• Can be operated ethically alongside your employment

Ideal Business Models for Working Professionals

There are many business ideas to consider when choosing entrepreneurship. You will also want to consider some key questions as you are brainstorming on which business to start. Do I do a product or service-based business? How can I best serve my future customers? What startup idea will resonate with my target audience and make an impact on my wallet? 

Consulting and Professional Services: Transform your corporate expertise into a consulting practice. There are 4.69 million small businesses in the professional, scientific, and technical industry, accounting for 13.5% of all small businesses. Whether you’re in marketing, finance, operations, or technology, there are small businesses that need your knowledge but can’t afford a full-time expert.

Digital Products and Online Courses: Create training materials, templates, or courses based on your professional expertise. Once created, these can generate passive income while you’re at your day job.

E-commerce and Direct-to-Consumer: More than two-thirds of enterprise marketers say they get a better return on investment with direct mail, and more than half of marketers use software products to facilitate their direct mail campaigns. Modern e-commerce allows you to automate much of the fulfillment process.

Service-Based Businesses: Bookkeeping, virtual assistance, graphic design, or content creation — services that can be delivered remotely and on flexible schedules.

Step 3: Getting Your Business Off the Ground: Leverage Your Corporate Advantages

Your corporate experience isn’t a limitation — it’s your secret weapon. Here’s how to maximize these advantages:

Professional Network

About 61% find customers through powerful word-of-mouth referrals. Your LinkedIn connections, former colleagues, and industry contacts are potential customers, partners, or referrers. HubSpot estimates that internet users conduct 8.5 billion searches per day via Google, but personal referrals often convert better than digital marketing.

Industry Knowledge

You understand the pain points, challenges, and needs of businesses in your sector better than most outsiders. This insider knowledge allows you to create solutions that truly address market needs.

Financial Stability

Your steady paycheck allows you to be strategic rather than desperate. You can turn down poor-fit clients and invest in quality tools and training. According to a survey, 63% of small businesses report that their business is in good health overall, and having financial stability while launching contributes to this success rate.

Business Skills

Project management, client communication, budget management, and strategic thinking — these are all transferable entrepreneurial skills that give you a significant advantage over entrepreneurs starting from scratch.

Step 4: Master Time Management and Productivity

Almost half of the small businesses spend less than two hours per week on marketing, which shows that successful businesses can be run efficiently. Many entrepreneurs start their businesses with just 1 hour a day. The key is consistency and focusing on high-impact activities.

The Early Bird Strategy for Starting a Small Business

Wake up 1-2 hours earlier to work on your business. This ensures you tackle your most important business tasks when your energy is highest and before corporate demands take over. About half of small businesses are operated right out of the owners’ homes, making this approach even more practical.

The Commute Conversion

Turn your commute into productive business time. Listen to industry podcasts, make client calls (hands-free), or use public transportation time for planning and email.

Weekend Warrior Approach

About 81% of business owners work nights, and 89% work over the weekends. Dedicate specific weekend hours to business development, but be realistic about what you can sustain long-term.

Micro-Productivity

Use small pockets of time effectively. Answer customer emails during lunch, write social media posts between meetings, or research competitors during downtime.

Step 5: Start a Business with Minimal Investment—Start Smart!

The beauty of starting while employed is that you don’t need to bet everything on day one. 27% of small businesses cost between $50,000 and $175,000 to get started in 2024, while another 27% cost between $250,000 and $500,000. However, many successful businesses have launched with much less.

Bootstrap-Friendly Startup Costs

• Business registration and licenses: $50-$500
• LLC formation: $200-$800
• Basic website and hosting: $100-$300 annually
• Essential software subscriptions: $50-$200 monthly
• Initial marketing budget: $200-$500
• Professional development and training: $500-$1,000

Revenue-First Approach

Focus on generating revenue quickly rather than building the perfect product. Pre-sell services, offer beta versions at discounted rates, or start with basic offerings that you can deliver immediately.

Financing Options

According to Guidant Financial’s 2024 survey, prospective small business owners overwhelmingly (52%) turn to 401(k) business financing, also known as Rollovers for Business Startups (ROBS). Other options include:

• Personal savings (most common for side businesses)
• Business credit cards
• Small Business Administration (SBA) loans (12% of financing sources)
• Friends and family funding

Step 6: Build Systems for Scalability

From day one, think about how your business can run without consuming every free moment. Roughly half of human resources (HR) professionals use top HR software to manage HR functions, with management software most commonly used for reporting and analytics (71%), payroll and accounting (68%). This shows how technology can automate business operations.

Plan to Start by Automating Everything Possible

• Email marketing sequences
• Social media posting
• Invoice generation and payment processing
• Appointment scheduling
• Customer onboarding

Create Standard Operating Procedures and a Detailed Business Plan

Document your processes so you can eventually delegate or hire help. This also makes your business more valuable if you decide to sell.

Use Technology Wisely to Run Your Business

Invest in tools that save time and improve client experience:

• Customer relationship management (CRM) systems
• Project management platforms
• Accounting and bookkeeping tool
• Time tracking and work tracking software
• Communications, email, chat and video conferencing and screen sharing tools

Of those who have implemented HR management tools, 21% say they have led to higher-quality candidates, showing how the right technology can improve business outcomes.

Step 7: Plan Your Transition Strategy

The goal isn’t to stay a side hustler forever — it’s to build something that can eventually replace your corporate income. The median yearly salary for a small business owner in 2025 is $67,000, though this varies significantly by industry and business model.

Financial Milestones

Create specific income targets, such as:

• Month 6: $1,000/month (proof of concept)
• Month 12: $3,000/month (viable business)
• Month 18: $6,000/month (preparing for transition)
• Month 24: $10,000+/month (ready to leave corporate)

Risk Management

• Build an emergency fund covering 6-12 months of expenses
• Consider COBRA or alternative health insurance options
• Plan for retirement account transitions (important if using ROBS financing)
• Understand unemployment benefits in your state

Transition Timeline

Most successful entrepreneurs spend 12-24 months building their business before making the full transition. This allows time to:

• Validate the business model
• Build a stable client base
• Develop systems and processes
• Create financial security
• Test your entrepreneurial skills

Step 8: Handle the Inevitable Challenges

Every working entrepreneur faces similar obstacles. Here’s how to overcome them:

Time Scarcity

Start small and scale gradually. It was more beneficial for entrepreneurs to work 30 minutes or an hour consistently throughout the week than it was to sit down and do three to four hours’ worth of work at one time.

Energy Depletion

Prioritize sleep, exercise, and nutrition. Your business needs you at your best, not running on empty. The top problem small businesses face is labor quality, specifically the difficulty in finding skilled workers, with inflation coming right after it. Don’t let yourself become the bottleneck due to burnout.

Imposter Syndrome

Remember that your corporate experience makes you more qualified, not less. You understand business operations, client needs, and professional standards.

Family and Social Pressure

Communicate your goals clearly and set boundaries. Explain that this is a strategic investment in your family’s future, not a hobby. Nearly one in four small business owners consider themselves “very happy,” while another 36% are “somewhat happy”.

Technology and Digital Marketing

Despite the overwhelming majority, there are still 11% of small businesses that don’t see the value in having a website. Don’t make this mistake. Almost half (47%) of businesses spend less than $10,000 on digital marketing per year, which means modest investments can create competitive advantages. If a website is not feasable, a landing page may work for starters. If going on YouTube is scary to promote your product, try posting on Instagram.

Step 9: Navigate the Current Economic Climate

Opportunities in 2025

46% of small business owners expect to create new jobs in 2025, indicating strong optimism despite challenges. Despite the challenging economic climate, 65% of small-business owners expect to see revenue increase over the next year.

Key Challenges to Address

The most common challenges among small business owners in 2025 include inflation costs (58%), revenue (35%), costs related to employee benefits (14%), access to financing (14%), and supply chain issues (13%).

Protection from Liabilities

Business liability insurance, particularly general liability insurance or Professional Error and Omissions, helps protect businesses from claims that arise during normal operations. These claims can include bodily injury (e.g., a customer slipping and falling on your premises), property damage to someone else’s belongings, and even reputational harm from things like slander or libel.

Cybersecurity Considerations

Around 35% of small organizations believe their cyber resilience is inadequate in 2025, a number 7 times higher than in 2022. As you build your business, invest in proper cybersecurity from the start.

The Bottom Line: Your Corporate Experience Is Your Competitive Advantage

The entrepreneurial landscape has never been more favorable for corporate professionals. Small businesses are 43.5% of GDP and pay 39% of all private sector payroll. You’re not just joining a trend — you’re part of a fundamental shift in how Americans work and build wealth.

A growing number of midlife professionals, particularly those in their 40s to 60s, are turning to entrepreneurship as their second act. After years in corporate America, they’re seeking freedom, control, and the chance to put their experience to work for themselves.

Your years in corporate America have given you something that many entrepreneurs lack: real business experience. You understand professionalism, client service, project management, and strategic thinking. These aren’t skills you need to learn — they’re advantages you need to leverage.

Success Statistics That Should Encourage You to Grow Your Business

Based on a cohort of newly opened businesses in March 2022, 23.7% of new businesses fail by year 1, which means over 75% succeed in their first year. While only 20% of small businesses fail within 1 year, this percentage balloons to 50% by year 5. Having a stable income while building your business significantly improves these odds.

The main reason behind startup failure (38%) is running out of cash or failing to raise new capital, followed by a lack of market need (35%). By maintaining your corporate income while building, you eliminate the primary cause of business failure.

Take Action: Your Next Steps

The question isn’t whether you should start a business while working full-time. The vast majority (86%) of Americans claim small businesses have a positive impact, whereas only 29% of Americans view large corporations positively. The data clearly shows that entrepreneurship is not only financially viable but also socially valuable.

Your entrepreneurial journey doesn’t have to start with a dramatic resignation letter. It can start tonight, with one hour of focused work on something that’s truly yours. In 12-24 months, that one hour could become the foundation of your freedom.

Ready to take the first step? Your corporate skills + a proven business system + current market conditions + legal protections = the freedom and income you’ve been working toward your entire career.

The only question is: what will you build first? Ready to take the 10 day challenge to shift from corporate professional to entrepreneur today?

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Sources:

• Cake.com Empowered Team. “Essential Small Business Statistics to Know in 2025.” March 28, 2025.
• U.S. Small Business Administration Office of Advocacy. “Frequently Asked Questions About Small Business, 2024.” July 2024.
• Guidant Financial. “2025 Small Business Trends.” April 2025.
• Federal Trade Commission. “FTC Announces Rule Banning Noncompetes.” April 2024.
• Frost Brown Todd. “The Non-Compete Agreement Landscape in 2025.” April 2025.
• Economic Innovation Group. “State Noncompete Law Tracker.” June 2025.

This guide provides general information about starting a business while employed. Always consult with legal and financial professionals for advice specific to your situation, employment agreements, and local laws.