How to Leave your Job to Start a Clinical Research Consulting Business

Are you looking to start a clinical research consulting business but are currently employed?

It can be hard to take the plunge, especially if you are risk adverse. Giving up a stable income to go out on your own and consulting takes guts. Kudos to everyone who has or will start their own business.

This article will outline key points to consider if you are thinking about leaving your job to start your clinical research consulting business. Remember that starting a business is not for everyone, nor is any time the right time to start. By reviewing the concepts below, you will have a better idea if now is right for you.

Let's get started.

Don't Quit Immediately 🔇

The worst thing you could is to quit your job without having some assurance that your clinical research consulting business will succeed.

For example, I will Teach You to be Rich Podcast episode 143. In this episode, Ramit is talking to a couple where 1 of the people quit their job making $60,000 a year to start a business making $1,500 per month (or $18,000 per year).

Don't be like that.

Please review the below concepts and follow through before taking the plunge and starting your business. You will increase your chances of success greatly.

Have you Validated your Business Idea 💡

You must have a burning idea about you want to sell with your clinical research consulting business.

But just having an idea is not enough.

Even asking people if they like your idea is not enough.

The only way to know for sure that you have a potentially viable business is that people actually give you money to solve their problem.

Not just that they would, hypothetically, give you money. You need cold hard cash to prove your freelance business can work.

Does your Business Solve a Real Problem ⚠️

Does the service you identified solve a real problem for a potential client?

You could start a business offering to take portraits of potted plants, but it is very unlikely that solves a real problem for a client.

The best problems to solve are where clients want to throw money at the problem, rather than their time.

Here is a great example from the design space. If a designer could create YouTube thumbnails—and do it well—YouTubers, like Ali Abdaal, will throw money to solve this problem for them.

Clients will gladly pay if you can free up their time.

Are you Targeting the Right Clients 🧑‍💼

If you are going to target clients that want to throw money at problems, rather than their time, you need to target clients that have money.

Students notoriously have no money. It does not make sense to try and build a business charging students $1000 plus for your service-unless you are a university or college selling degrees!

High income and high net worth individuals or businesses are ideal clients to target with your clinical research consulting business.

They have more money than they have time and are willing to spend if you can solve a problem for them, especially one that saves them precious time.

Do you Have the Right Skills 🤹‍♂️

Your clinical research consulting business service that you offer should be something that you can deliver on.

You shouldn't be selling monitoring services, if you have minimal experience with this. It is dishonest to clients and will lead to unhappy clients and a failed business.

It is ok to reach a little bit out of your comfort zone, but you should have high confidence you can deliver. Don't reach too far either.

Is your Business Idea Big Enough 📈

There is a large temptation to think small when deciding on a clinical research consulting business.

This means offering services that are too small in scope and bring in minimal revenue.

For example, what is a better freelance business: writing pages for $200 each or an entire report for $2,000 each?

The latter.

Why? You would need to sell 10x the number of pages to equal the revenue of 1 sale of the other business writing reports.

Less sales of higher cost > more sales of lower cost for a clinical research consulting business.

Daniel Priestly, author and entrepreneur recommends that an individual sale for a business be at least $1,000 or the business is not worth doing. The time and effort involved to land each sale is too high if you charge lower than that.

Are you Consistently Generating Sales 💵

The next item to check is if you are bringing in money on a regular basis.

If you are leaving a job, you already have money coming in. You don't want to be in a situation where you leave your job earning $X per month, but now only bring in $0.

You should also make sure that you are generating sufficient sales week by week and month by month.

One good month, followed by a couple months of drought could indicate a huge problem with your freelance business.

Living expenses don't take vacations.

You need to be sure there is money coming in every month to cover your business and personal costs. Otherwise you may be better off sticking it out in your job a few months longer until you iron out the kinks with your freelance business.

Ideally, your monthly profit would be equal to your monthly take home pay before fully committing to your freelance business.

Do you Have a Buffer in Savings 🛟

If you are not generating monthly profit equal to your monthly pay (and even if it is), you should have a savings nest egg built up before quitting your job.

A general rule of thumb is 3 months of expenses to cover any gaps. A larger buffer is better, but your business and personal situation will dictate what is best for you.

If you have a long sales cycle, then a larger buffer is likely needed. For example, if from initial client contact to sale is 4 months, having 3 months of expenses is not going to be large enough if you experience a drought.

You may also want to add a cushion for unexpected expenses like a car or home repair.

Do you Have a Business Plan 🗒️

A business plan is a great place to formulate your ideas about your ideal client and how you will solve their problems.

It is also a good place to think about marketing, sales, and other details.

A business plan is basically where you outline your objectives and create a road map to achieve them.

This is an invaluable tool to clarify your thinking about your freelance business.

Do you Have your Team of Professionals 👥

If you are starting a clinical research consulting business, it is likely that you are doing most of the work needing done for this business alone. However, you still will need a team of professionals to help you.

1. 💼 Legal Professional. They will help you draft and review contracts between you and your clients. They can also help with incorporation, if you decide to go down that route. Legal services are not cheap, but essential and can pay for themselves many times over by keeping you out of bad contracts and drafting solid ones for you.
2. 🧾 Accounting Professional. Having help to navigate corporate income taxes, sales taxes, payroll taxes, and other financial questions is invaluable. A good accountant can save you thousands of dollars by steering you in the right direction. Especially when it comes to taxes. The tax gremlins have high fees if you make a mistake and always collect.
3. 🏢 Insurance Broker. You'll likely need to purchase at least errors and omissions insurance for your clinical research consulting business every single year. A good insurance broker will find the perfect fit for your business.

Do you Have an Exit Strategy 🚪

Worse case scenario your clinical research consulting business fails.

It is best to have an exit strategy that defines when to throw in the towel and go back to being an employee, at least for awhile.

For instance, will it be when your savings run out? When half your savings run out?

Perhaps your exit strategy is a timeline. Failing to make a certain revenue target in the first quarter or year.

Whatever it is, come up with a plan so you don't dig yourself into a financial hole you can't climb out of by going all in all your business. If things don't go as planned, take a step back, reevaluate, and build that nest egg back up. You can always iterate and try again.

Summary

This article has given food for thought before quitting your job and jumping into a clinical research consulting business. Great respect to anyone who has anyone who will make the leap. These ideas will hopefully make it easier for you to be successful.

If you found the information here helpful let me know! If you have other considerations I would love to hear about them. Get in touch!