The Affluent Entrepreneur Show

How to Quit Your Job & Build a Profitable Business

May 08, 2023 Mel H Abraham, CPA, CVA, ASA Season 2 Episode 140
The Affluent Entrepreneur Show
How to Quit Your Job & Build a Profitable Business
Show Notes Transcript Chapter Markers

Ready to break free from the 9-to-5 grind? Do you dream of being your own boss and building a successful business that you're passionate about?  

Many people are seeking a way out of their traditional jobs in pursuit of something more fulfilling and financially rewarding.

But the transition from a steady paycheck to the uncertainty of entrepreneurship can be daunting, which is why I want to share with you the Entrepreneur Transition Formula, the exact framework I use with my clients to make that leap with more confidence, clarity, and profit.

So if you're ready to take the leap into entrepreneurship, listen in to this episode for practical tips and insights on how to do it the right way.


  • The importance of commitment in building a successful business
  • Understanding the Entrepreneur Transition Formula
  • How to increase your joy, fulfillment, and cash flow as an entrepreneur

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Mel Abraham  0:00  
How do you quit your job? Tell, some people would tell, you just walk in and say, I quit. But before you do that, listen, whether you are thinking about quitting your job, or and starting a side hustle or starting a new business, or you're thinking about changing businesses and transition to something else, there's a difference between being committed, and being reckless. And in this episode, the afternoon entrepreneurship, I'm going to give you the exact process, the exact framework that I use with my clients, and I've used with myself called the Entrepreneur Transition Formula, we're going to give you the process to do it the right way. So you are not reckless, you can be committed, and you raise the probability of success beyond the typical odds that business people experience. So grab your pad of paper, grab your pen, grab your coffee, and let's get on with it. I'll see in the episode, this episode, the absolute entrepreneurship. This is the absolute Entrepreneur Show for entrepreneurs that want to operate at a high level and achieve financial liberation. I'm your host, Mel Abraham, and I'll be sharing with you what it takes to create success beyond wealth. So you can have a richer, more fulfilling lifestyle. In this show, you'll learn how business and money intersect. So you can scale your business, scale your money, and scale your life, while creating a deeper impact and living with complete freedom. Because that's what it really means to be an affluent entrepreneur.

Mel Abraham  1:32
Welcome to this episode of the Affluent Entrepreneur Show. This one we're going to talk about how to quit your job, or how to quit a business and move to another business. Look, I get it. You know, there's times that we're going through things and and we are in a business, we're in a job and we're actually not enjoying it. And now we're starting to think this, there's this tugging this, this yearning that you sit back and say, You You're meant for more I know because I felt that okay, back. And we're talking about 1989 I mean, going back aways, I was working late one night, at the large consulting firm that I was working for right out of college, I'd spent five, six years there. It's a Friday night, I'm staring at the skyline of downtown Los Angeles. 10pm, another Friday night where I'm working late, I'm I'm burning the midnight oil, okay. And all of a sudden, this like, feeling came over me, that said, I'm not doing what I was supposed to be doing. I'm not using my skills, my talents, my my, you know, strengths, to the best of my ability. I'm not serving at the highest capacity possible. And I had I looked around I said there has to be more. And when I looked inside the offices, I saw the partner Tom that I was working for. And there he was sitting at his desk tooling. Pipe papers all around him stressed out, overweight. My guess is he had high blood pressure was probably an inch away from heart attack. In in that image, I saw my future. And I realized I needed to change. Now I did something that was reckless. I don't want you to do this. I literally walked into his office that night. 10 o'clock at night and said, Tom, I quit. I had no plan. I had nothing. I didn't know what I was going to do. I literally quit. cashed out my 401 K, which is another thing I wouldn't tell you to do. All right, and went to Japan. All right, until I figured out what I was going to do. So I don't want you to do that. I don't want you to do what I did. I want you to do this the smart way. Because here's what's going to happen. If we don't do this transition correctly. If we don't do it, right, you're gonna be living a dual life, kind of that feeling that I had, as I was staring out out over the skyline is this idea that I'm not living my life. This isn't my life. I get it. You know, I got a degree. This is the expectation. society expects me parents expect me simple. Everyone expects me to follow this path. But do you expect you to do it and you're living this this dual life? The second thing that happens if we don't get this right, is that there's just no joy in earning the only thing you're getting is a paycheck. Yeah, money's going into the bank account. But the cost of that is your well being your fulfillment and your joy. And in the end, you actually don't have a whole lot of cash flow coming in. Because you're not putting everything in it. You're not creating the value you could create because your heart isn't in it. But if we do this, right, you'll find your place in a place where you feel in flow, all of a sudden, just your You're moving, like I love what I do. I love being here, I love talking to you, I love being out there and speaking and working with people and watching your dreams come alive. That's where my flow is. That's the gift for me. And I get to monetize my passion, which is the second thing when you get this right, you get to monetize your passion. And from that, you will find the third thing which is freedom, and cashflow. So it doesn't matter what it is that you're thinking about doing. You know, maybe and we'll talk about some of those things. But but the fact is, is that if you're not on the path that you would have been called to be on, there's going to be struggle, there's going to be friction, and there's going to be resistance. But when you get on the path that you're meant to be on. You're more in flow, there's joy, even if they're struggle, and you feel freer in the process. Here's the things that I think you need to know, as we move through this transition, the things that you need to notice first is you got to understand the difference between committed and reckless what I did was reckless. Now, I was single, I didn't have children, I you know, I didn't have a spouse, I did, I did have a house. Okay, but it was still reckless. Committed is when you intelligently plan, and work the plan and work through through it from there. So so the first thing you need to know is that there's a difference between committed and reckless. The second thing you need to know is that you need to plan and test in the process. And the frame I'm going to walk you through will give you exactly the process to work from, we don't just flippantly go, I'm just gonna roll the dice, you might as well go to Vegas. All right. And the third is that you need to set what we call a scale threshold. This is the pivot point where you know that the Endeavor you're going into will work. And so I'll talk more about that in a second. So in order to do this, I'm going to jump to the iPad, because I'm literally going to walk you through the very framework that now I use with my clients, and, and my self, if I'm making a transition to make sure that I'm doing it the right way. It's called the Entrepreneur Transition Formula. And I'm going to walk you through this process. So I'm gonna jump to the to the framework, you'll get a chance to see it, I'll make sure that we hook up the, the, the graphic for you, if not, you can watch it on on YouTube on my YouTube channel, if you're just listening. But here's what I think we need to do. If we want an effective transition if we want to effectively quit our job or transition from one entrepreneur endeavor to another that we need to think about it. Now. I'm going to actually throw this out at you as a possibility because as part of the affluence blueprint, one of the pillars of the athlete's blueprint is the Generate pillar in the Generate pillar, what we're really focused on is how do we scale our income? How do we maximize and optimize our profits, it is about taking you from a drip of cash flow to a flood of cash flow. And when we can take it from a drip to a flood of cash flow, then you have the fuel necessary to build the money machine of wealth that gives you the freedom because your money's working harder for you than you did for it. And one of the best ways to do this is actually in an online program. Okay, using your intellectual property, your knowledge or wisdom and everything out there, because it has high margin, which means it's high profits. Okay, you've got low barriers to entry, low cost entry. Now the problem with that is that means that there's more competition, we'll talk in another episode is how do you set yourself apart from the competition, so you get paid premium for what you do want, you know, in a way that now you can start to generate additional cash flow. All right, but let's talk about the transition first, and then we'll get to some of those in the other episodes. Okay, so let's talk about the this idea of an effective transition. Here. There's three critical outcomes to have an effective transition. The first is this is that you actually have clarity. You know where you're going, you know why you're going you kind of know the steps that you're going in, you have the path you have the direction you have clarity, and you know, the reason that you're making the choices you're making. The second critical outcome is that you're moving towards your Kali. This is truly about you living directly into your purpose. What you've been put here to do, I think that all of us US are put here to give our gift to the world. And sometimes it takes us a while to figure out what that gift is. Sometimes we have to go through ups and downs and trials and tribulations, to realize, oh, this is what I'm meant to do. And when you find that zone, what you're going to find is, that's when you have joy when you're doing it. You feel in flow when you're doing it. And you come from a long day, maybe, and you still feel exhilarated. I know, for me, that's the way I feel when I'm doing stuff, or when I'm out there speaking and, and, and doing doing those things. So and then the third critical outcome of an effective transition is you have comfort. You don't yeah, there's always the uncertainty, but you have the comfort of knowing you've done some steps, you've done some things to assure more and higher probability of success. Instead of just flippantly saying, I'm out, I'm gone. Don't do what I did. All right. So what do you need to do in this, there's three things that you need to do in order to have an effective transition. 

Mel Abraham  11:18
And the first phase of this is, is what I call the preparation phase. This is where you start to move from what I look at as sketchy, to confident this is like going from I got this idea. And I just want to do this idea. And you just go half cocked, no plan, no, no nothing. And you say, I'm just gonna go do it. Now, you could be successful, but the probability is far less than if you did some of the things we're going to talk about here. But this is the stage where you start to find the confidence and you go from sketchy to confident. And this is the stage where you do all your thinking. This is the thinking stage. And from this stage, you move to the second stage, the second stage is all about evaluation. This is where you start to go, Hmm, could this work, and you start to actually think about what you're trying to do, how you want to do it, what you're really looking at to do and build it, it allows you to move from what I say naive to empowered. This is the analyzing stage. So you're going to do the preparation stage. And there's three things you're going to do in the preparation stage, there's three things you're going to do in the evaluation stage, I'm going to give you all of it, I'm going to walk you through, this becomes your checklist for transition from a business to business, from employee to business, okay. But this second stage of evaluation is where you're doing the analysis, I want you to move from naive, idealistic, to empowered and informed. Okay, and then the third stage, this, this is execution. This is where we get it done. This is all about going from just the idea to the results. This is where the dueling is, okay, so that first thing is to prepare, by thinking and going through it, then to evaluate by analyzing and testing, and to execute by doing the right things. So let's talk about each of these in a little deeper detail. So let's talk about preparation. What are the three things that you need to do in preparation, the first thing is this, if you really want this, I look at this and say you have got to have unmistakable passion. You can move from one job to the next. But if it's the same type of feeling, and there's no passion involved, it's just a short lived kind of thing because of the newness and then all of a sudden, you're going to struggle again, you're going to feel the friction, you're not going to feel the joy you're not going to. So I want to make sure that if you're going to make a transition like this, that you're moving from something to something that it has an unmistakable passion associated with it. Whatever it is, listen, people create businesses out of needlepoint around teaching how how to get babies to sleep. Okay, they teach coaching and physical fitness and all kinds of thing. There are all kinds of businesses out there. So it's not about the business. The question is, is the is the passion now, this leads to the second the second element here is that if you're going to create a business or something out of this, there has to be unquestionable value. And and here's why. Here's the thing, and this is a big deal that I think people miss. And that is this. We live in a value exchange economy. This isn't about price. This isn't about cost. This is about value. Okay? I can have passion, which is great. But can I create value in someone else's life with that passion? If I can't create value in someone else's life, and they're not willing to pay for that value, there is no business there. So, the key is to make sure that with that passion and my idea that I can create unquestionable value for the people, I want to serve the solutions, I create the solutions I give. And once you have that, now we start to look at it and we do this third step. And this is where we start to do investigative interviews. Now this isn't going to your friends that are yes, people, that you're gonna go, I got this idea. I really love doing this. So I think I'm gonna go do this. And then they turn around, say, oh, yeah, that's so good. And they just, they coddle you. Now I want you to go to your prospects. I want you to go the people that you want to serve. I want you to have conversations, real conversations with them about do they see the value? Is this something they want? And then one more thing, even though they want it, are they willing to pay for it until they vote with their credit card until they vote with their checks until they vote with their cash? That's not real. They might see the value and they might love it. But if they're unwilling to pay for it, we're not making money doing it. So the time to find that out is before we launch. And so we started doing investigative interviews. This is why they do market research studies and that kind of thing. But we tend to not do that we just flippantly go half cocked into into endeavor, I don't want you to do that. So in the preparation phase, unmistakable passion, unquestionable value, investigative interviews, those are the three steps. Then we go to evaluation. We got through this. And through the interviews, we say I've got refinement, I got an idea. It's, I think it can work. So now we go in and we take the next step. And that is a vetted plan. And what I mean by vetted plan is this, I don't want you to create a plan that requires all the planets to line up it to be a full moon and a blue moon. At the same time, in order for it to be successful. I want you to test the plan. I want you to stress the plan. I want you to challenge the plan, even my financial plans when we do our financial plans for our clients, or when my wealth team does it for me, we stress test the plan. What happens if the market jumps 30%? What happens if the market drops 30%? What happens if I stopped working and stop earning money? What happens if I keep working we test all the different scenarios to figure it out and say it's vetted. It has been tested, it has been refined, we know the probability of success, we do that. So you're going to take the time you're going to create a vetted plan. And you can look at alternatives, you're going to look at options, you're going to say what is the worst case scenario? What's the best case scenario? What's the most probable case scenario? What happens? What can go wrong? And how can I fix it before it goes wrong? You're going to do all of that work upfront, because that's going to raise your probability of success. If something goes straight for you. You can go How are you thought about that? I don't need to worry about it. We've already we've already planned for it. Then you go to the next phase. The next phase is what we call a micro launch. This is a test. Call it a beta call it a pilot call it whatever, a prototype, whatever it is, we're going to do a micro launch. We're not going to do grand scale. We're going to test it, we're going to vet it. We're going to figure out what missed what worked messaging, all those things. We're going to dial it in, and we're going to do a mini launch one that means that we're not exposed Think about it this way. So what comedians do, it's what I do. So I get to speak in front of 1000s of people like I've got two two keynotes already, that are coming up with two to 3000 people in the room. Okay, the last thing I'm going to do with a 2000 person room when they're paying me a $25,000 fee to come in and speak okay. Is to go and say I got a new material or the other is tested out on them. No, no, they pay me 25,000 to come and speak to make to help their pay People get a transformation to help their people have experience to help their people get a result. That's what I'm there to deliver. So if I got new material, just like a comedian, I'm going to test it in smaller groups. I'm going to refine it in smaller groups is the same thing with your micro launch, we're not going to go grand scale at the beginning, we're going to push it out there, small scale, test it, see what what we got back, see how it changes, see how we work through it. We did this with with the athletes blueprint, when I did the original launch, did the original launch. And I thought I was going to do it live the whole time. And I quickly realized when I did the first micro launch that I can't do it live, because there's certain parts of the of the Athens blueprint where you actually have to do work. Well, it'd be really boring for all of us to sit on a on a zoom call or or live while you're digging through your bank statements or anything like that. So what we had to do is shift it to a hybrid approach. So they, they could do the work and then bring the work and then we could coach and work through it. And I navigate and work through it with them that way. So you learn these things when you do the micro launch. Okay. And the third part of this is that after you do the micro launch, you have to do a meaningful, meaningful assessment. What worked? What didn't work? What do I need to change? What what are the variables that I need to adjust to, to build this up? Okay. That's the evaluation stage really building a plan, testing the plan and readjusting the plan. That's it. Now we get to the execution stage, what do we do here? Now all of a sudden, we're looking at it. Now we we start say, Okay, what's the financial viability of this? That's the first thing? What are the numbers? If, if we can only sell it for, you know, $1,000 or $100? It makes a difference? What is it costing you to produce the product to produce the service to give the service? Is it financially value viable? Is it scalable? Is it something that that you can you can make work? Do you control the whole aspect of the financial viability, I've got a dear dear friend, who was in the process of creating a beverage company until the supply chain issues came into play. And they had no control over those things. And now they've pivoted to do something slightly different in the same area. But the fact of the matter is, is that you have to test and question the financial viability of it. If you created a vetted plan in the in the first in the second stage in evaluation. Now we want to put numbers to and say, what is this going to make me Does this make it make sense, because here's the thing, if you're transitioning from one business to the next, or from a job to this, we have to continue to pay the bills, we have to continue to have financial stability and financial security in our world. And we have to do it smart. And if it's not financially viable, all of a sudden, you start living on credit cards, or lines of credit or equity in the home, because we didn't test the financial viability of it. And now you start to lose your financial foundation. That's the last thing I want you to do. So we got to test the financial viability. And then we ask ourselves in this stage, who's the performing team I need? Do I need to hire someone? Do I need contractors? Do I need advisors, attorneys, accountants? Who do I need to move this forward in the most effective, efficient, cost effective way possible? Identify those people identify your team, what are the roles? What are the roles you're going to play? What are the roles they're going to play? What is it going to cost that goes back to financial viability, all of that we needed that performing team. And then the third piece of this is this idea of what we call what I call the scale threshold. There is a point where you realize that this idea can scale and scale enough to allow you to transition. So you don't do what I did. I didn't have a plan. I didn't know the financial viability. I didn't test anything. I didn't micro launch anything. I didn't do anything. I just got irritated and quit. And I said I'll figure it out later. So what I recommend you doing is sitting back and say where is the scale threshold? Where is that point, that tipping point where when you get there you go, this has legs and it's got enough legs that I feel safe to let go of the other rope, my job, the other business and put everything here. Now your skill threshold is going to change base Certain circumstances based on whatever's going on, you might have three kids, you might have seven kids, like my wife came from a family of seven, okay? You might have no kids, you might be single, like I was, when I did it, all those things will change your scale threshold. So you need to to understand where that scale threshold is. Now that scale threshold can be done in one of two ways, or both. And that is $1 amount, it could be that I, I need to have $50,000 in the bank before I do this, or I need to be making $10,000 a month before I do this full time. Or it could be, it's costing me I spend $10,000 a month and living expenses. When I get to 50%. Of that, I know that I can push it the other 50% If I put 100% of my time in so you can state it as a percentage, or you can state it as $1 amount, but it's dependent upon your comfort, your resources and your situation. If you have a big, you know, sinking fund, then you're okay. This is something that I would actually if if it were me doing this all over again, what I would do is I would I would set $1 amount to have in a bank account, meaning that I'm not going to have to put everything on credit cards just to survive, that I sat back, I said, I don't have $20,000 in a bank account, that allows me to operate this thing and operate our life for two months, three months. And I'm going to operate this to a point where I'm making 40% of my needed expenses. So now all of a sudden, I have a bank account that's gone, that's keeping me safe from going into debt, or putting mortgaging the house or anything. And I'm already generating income, which raises the probability of success. Now when I can put 100% into generating that income plus, I have the peace of mind of having that sinking fund, I'm in good shape. That's the way I would play my my scale threshold. That means that it might take you a little longer to get out of the game to do the transition. But you've raised your probability of success, far higher than it would have ever been. I know that Amy Porterfield, my dear friend, Amy Porterfield, when she decided that she was going to go on our own, it was a it was a one year actually, it was a six months, I think, six months. process for her. It's different for everyone. But when you follow this framework, this this transition formula, you will prepare properly, you will evaluate effectively, and you'll execute consistently. This is the thing that we miss is that too often we go off half cocked into this, here's what I know is that you all have a calling in you, you all have something you are meant to do, you are placed here to give your gift to this world. Don't hold it back. If that's knowledge, if that's wisdom, if that's expertise, go do it. If that's a product, a solution to a problem that you see, that's pervasive that people are willing to pay for, go create it. But do it in a committed way, not a reckless way, follow the Entrepreneur Transition Formula, it will raise your probability of success, it will give you that pathway to make it happen. Here's the thing, once we start to build this, and we were on that right path, you're gonna see your joy go up, you're gonna see your fulfillment go up, you're gonna see your flow go up, then you're gonna see your cash flow go up, you're gonna see your income go up, you're gonna see your wealth go up, which then results in building the money machine that we talked about in the affluence blueprint to give you the financial freedom you deserve, which I believe is your birthright. So I hope this helps you. If you're considering transitioning from a job to a to an endeavor, a side gig or side hustle into a full, full time hustle, or from one business to the next. Paul, the Entrepreneur Transition Formula, this is going to give you the pathway to make it happen more effectively, more efficiently, more profitably. And with higher probability. I hope that you found this of value. And if you would, let me know what you think. Let me know if you have questions. Send me a note, send me a DM send me a question to ask Mel We'll make sure that we get it on the show, get an answer and help you out. All right. And if you know of anyone else that's in this transition or thinking about this, share this out, give them this. Give them the tools that they need to go live the calling that they deserve to live I just like you, and until I get a chance to see you in another episode, see you on the road as I'm speaking or have a conversation with you, which I would believe blessed to do. Always, always strive to live a life that outlives you see in the next episode, cheers. Thank you for listening to the affluent entrepreneurship with me your host Mel Abraham. If you want to achieve financial liberation to create an affluent lifestyle, join me in the affluent entrepreneur Facebook now by going to, and I'll see you there.

Difference between committed and reckless
The Entrepreneur Transition Formula
Three key results for a successful transition
Three things that you need to have an effective transition
Preparation phase
Evaluation phase
Execution phase
Three things to do in the preparation phase
Three things to do in the evaluation phase
Understanding the execution phase