Recently, BusinessWeek took a look at 11 formerly white-collar Wall Street workers who decided to go the franchise route. The entrepreneurs featured took different paths to franchise ownership. Some transitions were natural, like the story of Paul Nuti, who worked at Dean Witter and Morgan Stanley before launching five Roni Deutch Tax Centers in early 2009. Others didn’t have such a clear trajectory, like Jeff Myers, a former high-net-worth advisor for Merrill Lynch, who went from handling clients with assets of $250,000 or more to opening a CertaPro Painters franchise, or Rob Cox, a stock trader who decided to launch a Tasti D-Lite franchise But the 11 business owners had a few things in common — most of them decided to leave their jobs rather than wait to be laid off. To me, this illustrates an important truth: Successful entrepreneurs are proactive, not reactive. When they see change coming, they figure out how to benefit from it.
The fact that franchise companies are courting white-collar execs as potential franchisees is not new — the trend has been going on for years now. There are many reasons for this. Corporate execs are often a natural fit for the world of franchising: They’ve got business savvy and management experience, and they’re used to working within a system. On the downside, corporate execs who are too used to having a support staff may have a hard time adjusting to wearing the many hats that starting a franchise often requires.
One qualification that ex-execs tend to possess is particularly important in these days of credit crunches: Most of them have fairly healthy bank accounts, enabling them to finance their franchises without having to rely excessively on loans. Financial qualifications have always been important to franchisors, and now more so than ever. In the case of the 11 entrepreneurs in the BusinessWeek article, they took buyouts and severance to help fund their new franchises.
What’s the second thing those 11 entrepreneurs in BusinessWeek had in common? Even though they were working hard in their new roles, they all love the freedom of being their own bosses, rather than being at the mercy of their employers. With that kind of recommendation, I’m pretty confident that the trend of exec-turned-franchisee will only continue to grow.
Rieva Lesonsky is CEO of GrowBiz Media (www.growbizmedia.com), a content and consulting company that helps entrepreneurs start and grow their businesses. Follow Rieva on Twitter @Rieva and read more of her insights on SmallBizDaily.com. Also, find out about her new book, Startup Success, at www.smbsavvy.com.