I had about 12 years design experience, with five of those being after I passed the structural exam before I went out on my own. Probably not what you want to hear.

What would be your client base?

Mike McCann, PE, SE (WA)

I am in the process of starting my own firm however still struggling with stupid bureaucracy just to set up the legal form and clear the work authorization/permits. I have spent about 12 years employed in the industry relevant to my start up, 10 of which were spent in my area of expertise. Somehow I was forced to go into the path of creating my own business but the idea was also on the back of my mind for quite sometime. I guess the stressors / stimulus coming from the corporate world / HR BS are supposed to help sharpening our minds. In other words, when you fight the current war, your mind prepare for next war with some overcompensation that would make you stronger. The reality for me is that this went 180 degree opposite direction and I am now much more irritable to corporate BS than I was at my day one.

If I look at the level of expertise of the very senior people in my own field, I doubt I possess the 'critical mass' needed to put my project into orbit. I feel that my area of expertise is such a big universe of knowledge that relatively speaking I feel quite ignorant. I just trust behind this Chaos there can be a dancing star hidden. The process being that I need to [sometimes randomly] trigger events which in turn will unlock hidden paths / opportunities, for learning / growth and ultimately profit.

Beside knowledge, another premium advantage I see in being experimented is that chances you have a bigger network are higher. I think this gives a real edge.

Looks to be way too early. In addition you need to have worked with many clients before, otherwise there will be several very lean years. Also mistakes may come due to lack of experience, possibly resulting in legal problems. I'd give it at least 10 years first.

As a note, I'm not planning to leap out and start my own company the day I get my SE. I'm more approaching the subject from the following angle:

Assume you've become a licensed engineer and you're professional growth has ground to a halt. You've got 6 years of experience, are good at what you do, and are comfortable doing it independently and the peer reviews rarely if ever turn up any design issues, and are beginning to grow a client base. Would you stick around even though you're not really gaining anything from your employer other than "job security?" Would you look for another employer that offers the next level of professional growth you're seeking? Or would you try it on your own?

I worked in my industry for 23 years before going out on my own. The last 5 years I was thinking of going out on my own when I turned 50 (and could retire, the the lump sum and retiree insurance helped a lot). During those years I got my P.E., I served as an officer in the local SPE section, joined NACE, ASME, and NSPE, presented papers at a dozen conferences, got involved in other people's projects as an internal consultant. In short I built a network of people who knew me and might hire me. My first full year in business I paid more taxes than I made in the last full year I on a payroll, so I guess it worked OK. This is my 14th year in business.

At 4 years, and without a P.E.? I'd say you have an extra-good chance of becoming one of those businesses that fail in the first 5 years.

Your post sounds like you are setting yourself up for full-fledged "victim status" ("they're not developing staff", "I don't agree with their code of conduct", "they're not as good as my first company") so you can blame someone else for failure. NO ONE with a victim mentality ever succeeded in a start up business. Your company doesn't develop talent? Do it yourself. Join a society, write an article, learn a new skill. No one has more interest in your success than you do, put in the effort to facilitate your success. I treated my time as an employee as an apprenticeship, and made sure that I got in on every interesting project that I heard about, I would recommend you do something similar. You don't know how? It is simple, everyone likes to talk about their work, and a good listener is always in demand. Constructive suggestions to problems your peers admit to can go a long way (where criticism where not invited is never welcome).

David Simpson, PE
MuleShoe Engineering

In questions of science, the authority of a thousand is not worth the humble reasoning of a single individual. Galileo Galilei, Italian Physicist

zdas04, you bring up a good point about the "victim status," let me clarify a few things:

I got my M.S. in structural engineering on my time, outside of work.
I've taken plenty of personal time to get proficient designing with steel, wood, masonry, CIP concrete, cold-formed steel, and stainless steel.
I began studying up the basic fire design requirements for IBC and Factory Mutual recently.
My next topic is general building code requirements (allowable areas, heights, const methods, etc) to go along with the fire design.
I'm a member of ASCE, SEI, NSPE, and my local NSPE chapter, as well as ACI and AISC.
In other words, I take responsibility for my own professional development.

When I was talking about development of staff, I meant the general training of engineers in the company. In short, it doesn't appear to me that the leadership levels are training the leadership below them to eventually take their place - i.e., when certain people retire, things will go downhill.

So back to the original question for anyone else reading this - when did you feel like you were confident enough in your skills to start out on your own?

zdas04,

For someone in less favorable position than yours [23 years employed in your industry before going on your own / active member of organizations / professional accreditation ] and with a limited network ; overall say half way - or even 30 percent - from reaching the position/level [experience length and network size] you were in when you started...

Any tips / advice to mitigate the risk and have things not to go bust... what capital/terminal mistakes should be at least avoided...

Thanks for sharing

Another topic that I'm definitely interested in - what have you found to be the best ways to build a network?

Keeping your clients happy. You do want more business, not less, correct?

Mike McCann, PE, SE (WA)

You certainly need to get licensed before you attempt to hang out your shingle. If you don't get licensed you could get into more trouble than you bargained for, if you offer engineering services.

I started my first engineering firm two years after I became licensed. I was 30 years old and full of confidence. I was a bit more fortunate than most engineers in that my range of experience prior to that was very broad and that allowed me to pull it off. I had done design work (structural, including buildings, tanks, pressure vessels, piping, and lattice towers), process water and waste water treatment design, testing (mechanical, soils, concrete and odd materials), and inspections,and was licensed as a General Contractor. I ran that business for 6 years then sold out and went back into the corporate engineering world for the next 16 years. Finally had enough of that and started another engineering firm 12 years ago. No regrets.

"when do you think you were ready if you are/were an owner?"

about 1 or 2 years after you take the leap, maybe 3 or 4,

but, in hindsight, maybe 4 or 5 years before you take the leap

dood,

doo it

"Another topic that I'm definitely interested in - what have you found to be the best ways to build a network? "

msquared48 (Structural)
25 Jan 17 23:35
Keeping your clients happy.

amen

after that, maybe pay lotsa money for all the media bs, which I haven't done, but, hey I have a good business going, so, what do I know.....

Thanks for all the input, everyone. I really appreciate it!

Ron-I think I'm headed toward following a similar path to you. My first 3 years out of college I did purely structural engineering on a huge variety of structures, similar to what your experience range was, minus the testing/inspections and being licensed as a GC.

msquared48-the 3 architects I've worked with in my new job since I started (just short of a year ago) have all become repeat clients for me so far, does that mean I'm off to a good start?

The thing that kills more start-ups than anything else is under-capitalization. I sent my first invoice out on October 1, I cashed my first check on Jan 15. That company never paid quicker than 2 months and they were fairly normal. At one point last year I had 2/3 of my total billing for the year as receivable. If you don't have the wherewithal to keep the lights on for 6-months of no cash flow, don't start.

Other than that, you can only build relationships one person at a time. When I was Chairman of the local SPE Chapter I got to know the Program Chair really well. When I went out on my own he used my services a lot. Things like that.

David Simpson, PE
MuleShoe Engineering

In questions of science, the authority of a thousand is not worth the humble reasoning of a single individual. Galileo Galilei, Italian Physicist

I started my company 6 years after starting my first EIT position. At my place of training, I was heavily into low rise wood and custom homes (literally cranking out a full set of single family 3,500-4,500sqft in less than 2 days). Wood was "engrained" into my brain. I did some light, one story CMU, very little steel, and a touch of concrete. I knew where my passion was to begin with, and it was wood.

When I first started on my own, I gobbled up every little job I could just to keep paying the bills. I even free lanced with another structural firm when they were too busy and needed some support (not a bad option when starting out on your own if you have that relationship).

Towards the end of my first year, I THOUGHT I had a big break. An architectural firm came to me asking for a proposal to design some apartment complexes...my perfect scenario. I had a little over $20k bid on this project and in October of 2013, he stated that the project was mine, and that unless there was an act of god that wouldn't change. On Christmas Eve, this architect had the audacity to call me around 5:30 PM, and inform me that they chose to go a different direction. It was literally one of the most devastating gut blows I have ever had. I was pretty depressed for a couple of weeks, to the point of nearly abandoning my business. Then I decided that, you know what, I'm going to make it a point to make this architectural firm my client and not give up. I knocked on the door with them for nearly two year. They gave me a few crap jobs here and there. And then, finally, there most senior architect gave me a shot at some assisted living facilities. From that point on, they have given me all of their business.

That architect wasn't the first that I worked on for nearly 2 years to gain as a client. The moral of my story is that building a business takes determination and perseverance. I chose not to go to the firms I did work for at my old firm and take their clients with me...I was above that ethically. I started my own new client base. Some people take clients with them, and in some cases, rightfully so and I don't disagree with it because it is all a case by case basis.

My perception is that my business is nearly 90% marketing and relationship building. Sure we do a lot of numbers crunching and drawings, but that stuff wouldn't come into the door if I wasn't doing the ground work. I always answer the phone, or call back immediately. I answer questions for clients and give advice for free for small things that take maybe 30 minutes to figure out...they really appreciate this. A recent example is one of my main clients asked me to walk a building with them and give my thoughts on a structural system and to see if I saw any red flags. They called expecting me to invoice them. It took probably 4 hours out of my day. I told them I wasn't going to invoice them and they were shocked and grateful. It's the little things that you do that keep clients happy and a willingness to do "business development" knowing that you could be doing actual billable work.

Higher people that are smarter than you to fill in the gaps and do the work that you were good at (maintain/or better your standards and expectations though). Don't try to be the expert (unless you are solo, which you probably will be for a while). Be the expert in building your business.

Thanks, CBSE! How long have you been running your own business? Have you ever thought about going back to working for someone else?

I have had my business for 5 years now. So not long, but long enough to get through the growing pains. The last time I thought about going back and working for a company was in 2013 per my story above.

On your own is a little scary at times, especially in the beginning. Interestingly enough, my billing rates aren't much different than the company I worked for originally. There's a perception that the small firm is cheaper, and in a lot of cases the small firms are cheaper. I have gotten so efficient with what I do that my actual billing rate after completing my jobs is close to double what I put on my hourly rates. It is really hard to think about going back to the corporate life now. Plus, if I need to take some time to do something with the family, I can do it. I can take my work everywhere with me.

CBSE-another question for you.

What are you thoughts on hiring employees? Have you? Would you?

Yes, I have one full time employee and looking to hire an EIT. A big thing to consider when hiring as a small firm is what kind of workload the employee may. E able to bring in. Checking client references (previous architects/builders) and seeing how well they interacted and performed is key. I didn't expect to hire a dedicated numbers cruncher because I want to grow the business, so it really depends on what you want to do. I expect my employee to pursue more work and develop addituonal relationships, and I provide financial incentive/flexibility to do just that. I decided to hire when I got to the point where I had a comfortable "take home pay" and could still support a full time employee...i.e. As an example, if I could easily live off of $70-$80k per year, when I hit $140-$150 in billings, I would think I could hire an employee...just an example. Hiring frees up time that you can pursue addituonal clients. I know a couple other solo engineers that stop pursuing work because they can't take on any more, they aren't taking advantage of the potential.

It really depends on what your aspirations are and the risk you want to take. It's hard to find someone that has the same or higher standard than you do though.

A company I interviewed with was started by two individuals that started the company the same year they received their PE's just 4 years removed from undergraduate studies. No MSE, no SE, just PE and 4 years of work experience. They have been in business for almost 15 years and are one of the top firms in the state. It really doesn't matter how much time you wait. What matters is do you have a plan and resources to bring in work and produce an engineering product to a high level. You won't be that much more prepared knowledge wise now than 5 years from now about how to RUN a business unless you do it IMO.

If someone wanted to specialize in doing very specific studies, than I think four years would be enough. I don't know how you line up a lot of very specific work but maybe it works if you are able to pair up with someone who bring complimentary skills to be able to offer more. That said, I am not very impressed by a lot of consulting. Too much of the time, the consultant is only a half step ahead of the client engineer because he spent the evening before reading about whatever. I suppose if you are able to convince a client you are capable and can delivery, maybe not having a ton of experience could work.

Structural dood...

Yep. The word will get around. Just give it time.

Mike McCann, PE, SE (WA)

Producing a quality set of drawings is also very key. In the beginning, I would actually sit down with the contractors/architects and go through my drawings page by page and have them tear them apart. Through many iterations and comments/suggestions about my drawings, I believe I have started producing some of the best drawings/details around (my biased opinion I suppose) and the contractors really like them. Not only was going to these contractors/architects helpful, it also helped build a very good working/trusting relationship with them (BUSINESS DEVELOPMENT).

It's very easy to get stuck doing things the same way because it has always worked, the company I started with was in that rut. But if you don't actively seek advice and actively work to improve, chances are, you are missing out on lots of opportunities and professional growth.

If you decide to make the plunge, be patient. It will start slow, unless you take clients with you or have already started to line things up. People moon light on occasions to do this, I'm not recommending it, but people do it. Also, if you leave your company, leave on good terms, they may throw things your way if they are too busy.

Thanks for all the input, everybody! I really appreciate it!

I had about 13 years of total experience before I was forced errr...... went out on my own during the economic downturn. That was about 8 years after I was licensed. I had all my experience working for a steel fabricator doing "design-build" work. When the company imploded everyone scattered like rats from a sinking ship and I had my first set of clients. The problem that I have now is that I am somewhat limited by my experience (designing steel building on shallow foundation systems). It hasn't proved to be a problem 5 years later, but at some point I'm sure it will.

At this point I can't envision a scenario where I would go back to work for someone else. When it's busy I would need to take a pay cut, when it's slow, why would someone want to add staff.

10 years, usually with some management experience, appears to be the sweet spot from my observations. It also seems to help if you have a wrinkle or two and a couple gray hairs.

As you move through projects, save your contacts somewhere and make a note as to what the connection (project, experience joke, whatever) was. There are online apps that you can use or you could simply use a spread sheet. Save it somewhere (drop box, google drive, other cloud server) that if your computer dies or you have to leave your company unexpectedly, you can still access the information. There could be many people you will work with and then forget about that you will wish you remembered if you start on your own. These contacts will be valuable whether you start your own company or decide to join someone else's firm.

Mr. Dood,
Regarding starting a full service structural engineering outfit, efficient in all materials, all building types, if that is your wish, you have a responsibility to the public to be proficient in what you profess to be and practice. Personally, I feel some additional experience is necessary unless you've found yourself in a nich'e market which may get you, and has a lot of us, out of the gate.

I believe you have a more immediate concern with regards to your current employ. I would recommend you assess your immediate work situation and ask yourself if you are gaining the experience you need at your pace and as you alluded to, "Do you have a willing mentor who is making a difference in your career?". Not all of us have had the privilege to have such a person that has positively affected our knowledge and "excitement"(said loosely)of our craft. If you plan to make a move, and say it is five years from now, make a move to a new employer as soon as possible if you feel you are missing out on experience you will benefit from when going it alone. And unless you've got a whale for a client at the start,it may very well may be alone/one man shop,...for some time before hiring up. So, you'll need a broad spectrum of experience to chase different project types,...unless again you are that niche' guy. I once had an prospective employer in an interview say to me, "You've moved around a bit, no more than 5 years experience at any one employer,...you know, this will ruin your career." It did anything but that, instead it exposed me to every building material, structure type, East to West Coast. Make a move, make this one very purposeful to an employer that may help fill any gaps, your jumping board to doing your own thing. Good Luck!

(From a fellow entrepreneurial spirit...left a small firm where I was a partner 9 years ago, started/still a Suite 204th Bedroom Operation, no commute time lost, hiring help only when needed, had a slow start, had a patient/income providing wife, income drastically reduced for the first few years, cannot say I went hog wild marketing myself and business, somewhat on purpose after some mid-career burn out, enjoyed seeing my boys before they left for school and was able to begin catching bedtime stories instead of being stuck in traffic, coached their sports teams, kids now grown and independent, finally hiring up this year now that backlog is concerning my clients, plans to split/lease office space with large Civil/Surveying firm of which I will service all of their statewide offices' structural work, keeping my company and clients independent. I have no regrets to work for a number of employers, it made me what I am, and confident to tackle most any projects, and I can not wait to mentor again, it has been the most enjoyable part of my career, please promise to do the same down the road for someone before you retire. Retire,,,,,which I hope to do within a decade if I'm lucky!)