Can starting your own business disadvantage your overall career?

I have spoken with and represented many people in the last six years who went out on their own to start a small business that for one reason or the other came to an end. When those individuals came back into the job market, especially a challenging one, it became clear that they were disadvantaged is some ways. Large and mid sized companies often target professionals who are coming from a similar environment who are familiar with the culture, challenges and processes of companies their size. When in individual has worn all the hats, had all the control and worked with few or no peers their ability to jump back into a corporate environment can be difficult.

Beyond the culture shock having your own business that did not succeed may also be a factor that inhibits candidates from getting response to their resume. If a hiring manager is not familiar with your business they may look it up online, making your web presence critical in their evaluation of you. Bad website = no call back. Hiring managers may also simply want someone from an organization with a specific size, industry sector or product offering that you do not match. A final factor that many hiring managers are concerned with is whether or not that candidate will leave them to reengage their business or start another business when the market conditions improve.

On the flip side there are organizations that would value the type of experience a small business provides and are not concerned by the challenges mentioned above. Those organizations value someone who is independent, entrepreneurial and does not mind wearing many or all the hats. For some professionals this type of environment and opportunity are a bulls eye for their goals, though more professionals are interested in a more defined role within a structure team environment.

Give serious thought to starting your own business and how it may affect your career if that business is not your "cash cow" from here on out. Make sure you consider the current and the future of your market sector. Build a contingency plan in case the business does not take off or dose not last. Consider what you can do during the time you run your own business that will position you for success in future corporate career searches. The market is fickle and during the downturn of 2008-2010 I have met with and counseled hundreds of people who were in this situation. Some of them were able to leverage their networks, past experiences, interviewing skills and personalities to make a smooth transition but many others were on the market for months and ended up taking a position out of desperation that may continue to haunt them as they try to get back on their career track.

Hire Learning - Under Construction

Comment by Amber on March 22, 2011 at 11:43am: Many employers also want to know why someone went out on their own and why they want to go back to working for someone else. Concerns about the person giving up their "freedom", or "why weren't they successful enough to stay self-employed" are the main reasons for reluctance. This may vary a bit depending on the industry and/or type of job, but it is usually something that will at the least cause the employer to question further. And many simply do not want to even consider those who are/were self-employed recently.

Comment by Paul Alfred on March 22, 2011 at 5:55pm: I have a quick solution ... I turn that role into a Contract. It really kills the headache ...

Comment by Sandra McCartt on March 22, 2011 at 6:11pm: I have never had a problem with a candidate who has gone into business for themselves and hit the wall. I take the attitude that everybody dreams of owning their own business at some time or another. Those who have rolled the dice and hit the wall for whatever reason are less likely to ever try it again.

That's the way i present the candidate. IT is a different ball of wax but other verticles not a problem.

Comment by pam claughton on March 22, 2011 at 7:58pm: Ditto what Sandra said, has never been a problem and actually is often seen as an asset. I just placed someone a few weeks ago who had started a company and was ready to broaden his experience by joining a small growing start-up and they loved that he had that entrepreneurial spirt. I've placed other candidates who were successful, but didn't realize how much they'd missed the collaboration that happens in an office environment. As long as the reasons are sound, there's rarely an issue.

Comment by Suresh on March 23, 2011 at 9:07am: Something that I have thought a lot about. With an engineering background switching to Recruitment Advertising is as crazy as it sounds.

But, I have to believe with most people going through the recent downturn will be more understanding. Lesson learned - You always need to keep option A, B or even C around.