Freelance Guide: If You Don't Meet These 5 Conditions, I'd Advise You Not to Quit Your Job.

If the side hustle you're engaged in seems to be gaining more and more momentum, you might also be grappling with this question: Is there a way to calculate the best time to quit your day job? While there isn't a one - size - fits - all answer, based on the author's experience of working with executives and leaders who have successfully made the transition, five questions have been summarized to help you determine if you're ready to take this step.

According to research by international consulting firm MBO Partners, the number of full - time independent workers in the United States grew from 13.6 million in 2020 to 27.7 million in 2024. 84% of them said that independent work made them happier, healthier, and more secure. Once considered a risky career path, it is now being pursued even by senior corporate leaders to take control of their time, income, and the people they work with.

So, why don't more people choose to quit? Figuring out when to take this step can be one of the most complex factors in making this choice, and many people struggle to get the timing right.

One of us (Katrina) quit her job at 23, giving up the opportunity for a six - figure income at a tech giant to become an independent writer and travel the world. At least, that was the plan; however, three months later, she was working at Starbucks. Since then, she has expanded her network by building new connections and opportunities. Eventually, she signed contracts with companies like HubSpot, then worked with entrepreneurs at Digital Press, moved on to startups like M1 Finance, and finally landed at Category Pirates.

The other one of us (Eddie) waited until he was 43, when he was already a senior partner at a consulting firm, to start his independent business. By then, he had already accumulated enough capital and professional resources to quit his full - time job. Looking back now, he realizes that he could have left a few years earlier, and this delay may have cost him millions of dollars in potential additional income and precious family time.

The last author (Christopher) made this decision at 38. In 2006, the company he worked for, Mercury Interactive, was just acquired by HP for $4.5 billion, and he was the chief marketing officer at the time. It might seem a bit early, but he had been an entrepreneur since he was 18, served as the chief marketing officer for three listed tech companies, and had accumulated over 4 million miles on American Airlines flights. He was ready for new challenges.

If the side hustle you're engaged in seems to be gaining more and more momentum, you might also be grappling with this question: Is there a way to calculate the best time to quit your day job?

This is a question we've researched and consulted on, and we've also thought deeply about it before making this decision ourselves. Our company, Category Pirates, has started offering relevant courses. Currently, we're in the final stages of writing a book on this topic.

While there isn't a one - size - fits - all answer, based on our experience of working with executives and leaders who have successfully made the transition, we've summarized five questions to help you determine if you're ready to take this step.

Can the cash flow from your side hustle consistently exceed that of your main job?

Ideally, you should have a consistent record of this, but the growth trajectory, pricing power, scalability, and word - of - mouth of your side hustle can also help you make this decision a bit earlier. If you're fully committed, a strong growth trajectory is enough to help you estimate the potential of your side hustle. Your side hustle must have pricing power, which is the most real signal of demand. New automation tools like Zapier can help you scale your side hustle without simply investing more time or labor, because the way of selling (business model) is more important than what you're selling (product or service). Finally, your side hustle must be able to generate word - of - mouth in a natural and easily scalable way.

When Dickie Bush was in his twenties, he was earning $200,000 a year at BlackRock. Fourteen months after launching a digital writing business with Nicolas Cole, he quit his job at BlackRock. By then, the income from this business was four times his salary, and it showed a stable growth trajectory, increasing pricing power, good scalability, and a good reputation in the digital field. Now, their business has an annual revenue of over $6 million.

Can your "superpower" produce 10X results?

The 10X result is a benchmark commonly used in management consulting, referring to the direct income, profit, or valuation result that the client gets from your work, which is at least ten times the cost.

What is your "superpower"? It's crucial to be clear about this, and it's not as easy as you might think. Hint: It has nothing to do with your title, background, or resume. Your "superpower" must be a unique ability that can be easily quantified by others in the market.

When Holly Miller was the global brand director at pharmaceutical and medical device company Allergan, she developed and implemented a category design strategy that increased the revenue of a product from $25 million to $100 million in four years, a four - fold increase. She achieved this by completely changing the marketing strategy, that is, redefining and naming the different problems faced by end - users, rather than just promoting product features and technology. As a result, end - users and doctors regarded Allergan's products as a unique and irreplaceable category. The revenue quadrupled without adding additional sales representatives or significantly increasing operating expenses.

Miller realized that her ability to develop, name, and implement unique strategies in the medical technology field was extremely rare, and the results she created with this ability far exceeded the value corresponding to her mid - level six - figure salary. When competitors started calling to recruit her to their teams, she got further confirmation. So, she is no longer an executive but founded Grey Matter Marketing and serves as the president, leading an 11 - person team to use her "superpower" in her own way to design new categories for life - science companies.

Do you have enough and the right kind of capital?

Reserve funds are a good safeguard, but you need less money than you think. On average, it takes about $10,000 to $40,000 to actually start a business, and money alone is not enough. You also need three other types of capital.

Reputation capital refers to a record of consistently achieving results for specific problems and specific types of clients you serve. Relationship capital means having three types of people around you: those who can see the potential advantages you overlook, relatives who won't lie to you, and peers who are willing to cooperate with you. Knowledge capital refers to the knowledge you've transformed into assets that others can access and for which they're willing to pay you, allowing you to achieve results even when you're resting. This can be books, courses, diagnostic methods, frameworks, or tools through which you can make a profit without spending time or get a very high premium for your time.

Jeff Klimkowski wanted to be an investment banker since the ninth grade, and he achieved this dream at Deutsche Bank and worked there for 13 years. But he gave up a seven - figure deferred compensation and the opportunity to be promoted to managing director to pursue another dream with his elementary school friends - to found Dude Wipes.

Dude Wipes is a leader in the flushable wipes field. Jeff founded the company with his childhood friends Sean Riley (CEO of Dude Wipes) and Ryan Meegan (CMO of Dude Wipes). After graduating from college, they lived together and realized that regular toilet paper wasn't enough for men who liked beer and burritos. They started this as a side hustle over a decade ago. Sean and Ryan had 9 - to - 5 jobs and would pack and ship wipes from 6 p.m. to midnight every day. Jeff provided the operating funds with his investment banking bonuses. They got an investment from Mark Cuban on the show "Shark Tank," and Cuban bought 20% of the company.

Humor is their "superpower." They dared to openly joke about personal hygiene issues on social media, and this kind of content would never pass through the conservative marketing departments and cautious legal departments of Fortune 500 companies. Soon, Dude Wipes grew so fast that Jeff had to make a decision. Jeff had the reputation of an entrepreneur and the identity of an investment banker, was strongly encouraged and supported by his boss, and had in - depth professional knowledge in mergers and acquisitions and capital markets. All these qualities made him well - suited to be the CFO of Dude Wipes. As Sean said, "You can always go back and get another investment banking job." In 2024, Dude Wipes' retail revenue reached $219 million, and recently, it received a significant minority investment from a leading consumer private equity firm.

Can you control your emotions?

If you can't regulate your emotions, it's difficult to make the right economic decisions. The hardest part of quitting isn't the unstable cash flow, but the constant self - doubt, impostor syndrome, and loneliness. Your emotions can seriously affect your pricing, causing you to undervalue your products or services and offer discounts before the client even speaks.

Nick Bennett teaches other independent entrepreneurs how to take this step. He not only provides specific business expansion strategies but also offers psychological counseling to help them deal with various negative voices and emotions. Nick realized during his entrepreneurial journey that it's crucial to have like - minded people around. He formed a text message group with three other entrepreneurs, which eventually developed into a Slack channel with over 50 members. Even though he had already achieved success in his coaching and consulting work, he still keenly noticed the powerful potential of the community and found an opportunity to truly increase the value of his time. He and his partner launched a product and earned $30,000 in a weekend.

Are you more committed to your craft and mission than to praise and money?

If you're a writer, you must find joy in constantly improving your writing skills even if your works don't achieve much. You must be clear about and committed to your mission and be willing to give up money that doesn't align with your mission. You must love the problems you solve more than the solutions you provide. This ensures that you have the perseverance to innovate and increases the chances of creating value for your clients. Loving your craft and mission will always bring more substantial economic rewards.

Danny Bauer helps school principals achieve significant results in student and campus culture. Adam Frankel helps developer - oriented startups rapidly expand and secure the next round of financing. Both have successful independent consulting businesses, but they're extremely committed to their crafts and keep innovating. Now, they both run digital communities with six - figure memberships, and these members are the people they can help on a large scale, and it also provides a channel for their consulting businesses. Danny launched a top - ranked podcast, and Adam wrote a best - selling book in his professional field.

Based on our research in this field, we expect the number of independent workers to double in the next decade. Personal and financial freedom are too attractive, especially as job stability in large enterprises and government departments declines. The proportion of single - person households increased from 8% in 1940 to 28% in 2020, making independent living easier and requiring support for fewer people. But the desire to create will accelerate this transformation. Our data shows that 77% of American employees want to "be paid for creating." Millions of people will recall their childhood creativity, realize that they can also earn income through creation as adults, and then take this step.

This article is from the WeChat official account “Harvard Business Review” (ID: hbrchinese). Author: HBR - China. Republished by 36Kr with permission.