I was talking with a colleague the other day about starting a business and all of the moving parts that are involved in the process. Somehow, our discussion moved to the idea of having a contingency plan in case the business didn’t work out — boy, did we disagree on that topic!

My colleague was adamantly against the idea of creating a Plan B, while I argued the value of having a fall-back plan. Here is an overview of our perspectives. Weigh in with your own at the end.

Go Big or Go Home

My colleague’s perspective is this: If you are not committed enough to do whatever it takes to create a successful business, then you are destined for failure. I agree with this! Remember this post?

But then he went on to say that actually taking the time to create a Plan B gives you an out; it gives you permission to fail. He said if you forge ahead without the safety net, you sure as heck will be a lot of more likely to fight to stay up on that tightrope (doesn’t starting a business often feel like that??), no matter what.

His perspective is that it’s the cushion we create to soften the fall that actually tells us it’s okay to give up and fall off.

He told a few different stories about entrepreneurs he worked with who used their Plan B to justify every shortcoming, every failure, every wimp-out. He said contingency plans make entrepreneurs soft.

The Case for Contingency

Now, my perspective. I don’t entirely disagree with what my colleague said, but I would never recommend walking a tightrope without a net. That’s just stupidity, unless you have a death wish.

Here’s the thing, starting a business is hard. Painful, gut-wrenching and exhausting. And after you put every piece of yourself into it, you may still fail. There are no guarantees. That is the nature of business — a large percentage of new businesses simply don’t survive. And that’s the risk you take when you become an entrepreneur.

But, that doesn’t mean you have to squeeze your eyes shut, leap off the edge and hope you survive to tell the tale. Having a contingency plan is a smart. Here’s why:

  • A contingency plan forces you to face the possibility of failure.
  • A contingency plan can boost your confidence and give you a sense of security that makes the necessary risk-taking easier.
  • A contingency plan can help you devise an incremental start-up plan instead of going full throttle before you’re ready (i.e., starting a business on the side while you’re still working full-time).
  • A contingency plan is never going to be half as good as your goal, so staying far away from it can be motivation by itself.

What’s Your Happy Place?

By the end of the discussion (no punches were thrown), we agreed that a Plan B can work for some, but maybe not others. A lot of it seems to depend on your personality, your desire and your determination.

So, we’re going to turn the floor over to you now. Do you have a contingency plan? Why or why not?

 

Image credit: christgr

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