Should staff be allowed to start and run their micro business on the side while working in a corporate job? Or better still, run the business in between full-time work with their employer’s blessing. My answer is no, with qualifications.

The idea is not as crazy as it sounds. Some professional service firms are allowing staff to launch a startup venture and do their regular day job. That was usually a no-go zone in years past as companies insisted, through employment agreements, that staff focus fully on their job.
Juggling launching a startup with a full time job can lead to problems.
Juggling launching a startup with a full time job can lead to problems. Photo: Erin Jonasson

Imagine working as a manager during the day and building a phone app or running an online retailer at night or when work is not busy. The job’s regular pay cheque provides capital for the startup, and the startup is a way to transition to self-employment.

Companies know that being overly prescriptive on what staff can do in their spare time limits the ability to recruit high-potential employees. Rather than resist staff who dream of launching a hot startup one day, why not find ways to accommodate them?

Combining full-time and self-employment is manageable provided the startup does not compete with the firm, there are no conflicts of interest, and the time demands of a micro-business, which may take a day a week, does not hurt the employee’s performance.

Who knows, a young manager may develop a hot startup and take the idea to their corporate employer for seed funding and development. It could take the firm in a new direction and help it hold on to entrepreneurial staff who would have left anyway.
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From the employee’s perspective, running a profitable micro-venture boosts their income at a time of record-low wages growth. They build equity in an asset, develop new skills, and create an “insurance policy” should redundancy strike. Knowing they can move full-time to their micro-venture and take it to a new level is a great comfort.

Also, combining full-time or part-time work and self-employment is the future in many industries. I have long argued that more people are moving towards portfolios of micro-jobs and even micro-ventures. Working for several employers is the norm for an army of freelancer and contractors.

Moreover, work and personal time has never been this blurred. Smart companies accept that staff mix professional and personal lives more than ever during work hours, and that technology is enabling greater workforce flexibility and productivity.

So why am I against the idea of combining full-time work with micro ventures?

For starters, it does not work. Entrepreneurship is all or nothing. I’m yet to meet a successful venture creator who worked in a full-time job for years and built and ran a small business on the side before making their move. Great entrepreneurial opportunities are fleeting; those who want to pursue that hot startup idea must put everything into it.

I’ve also seen corporate employees damage their career by running businesses on the side. Inevitably, they get caught in conflicts, struggle to meet the demands of the startup’s clients, feel tired, and often have to sneak behind their employer’s back to run the venture.

Great entrepreneurial opportunities are fleeting; those who want to pursue that hot startup idea must put everything into it.

Entrepreneurship involves taking and controlling risk. Those who will not run a venture full-time because they fear losing their full-time job and pay cheque will never succeed in startup land. Entrepreneurs are compelled to start a venture because the opportunity is so strong and they cannot bear the thought of not pursuing it.

Technology-driven industry blurring is another issue. A young media executive, for example, may build a website that sells homewares. But who is to say their employer will not repackage content around home furnishings and a do a similar site. The idea of radical adjacencies – companies moving into seemingly unrelated industries because of technology – means greater potential for conflicts of interest for staff who launch startups.

Don’t get me wrong: I’m not against companies offering greater flexibility for outstanding staff who have a passion for startup ventures and self-employment. But mixing that with the rigours of full-time work is too much to ask for most companies and employees.

A better option is sabbaticals or other flexible working arrangements. For example, giving certain staff a year off, without pay, to pursue their startup dream and the option of re-joining the firm earlier if it fails. Or moving to part-time work, say two days a week, with the rest to be spent on the start-up.

This approach creates clearer boundaries between full-time work and self-employment. It also avoids the problems of blurring the two, gives the employee the best possible chance to launch their venture, and better protects the employer and saves on costs.

Forward-thinking companies could even encourage staff to go back to university and launch their venture during the year off. If it doesn’t work, the employee comes back with new skills and energy – and probably greater appreciation for their full-time job.

I’m sure older readers are thinking: why should a company pander to an employee who wants to work for themselves? It’s a fair question. Companies have a right to expect their employee’s full focus and energy during work hours. But the digital era is blurring work tasks like never before: mixing different forms of employment is inevitable for many people.