09 Sep Leaving Corporate to Start Your Own Business? Look Before You Leap
You’re excited. Nervous. Maybe even relieved.
You’ve either decided to leave your corporate job or the decision’s been made for you. Maybe you’re being offered a severance agreement. Maybe you’re finally ready to launch that consulting business that’s been sitting in the back of your mind for years.
You’re already imagining your new business name, your shiny new business cards, updated social media profiles, your clean and simple website.
The freedom. The independence. The chance to finally build something of your own.
But before you order business cards or book your logo designer…
STOP.
Because right now, you’re about to walk into a battlefield completely outmatched.
Your soon-to-be former employer? They’re sitting on an arsenal of legal firepower. Their contracts were written by lawyers. Reviewed by lawyers. Enforced by lawyers. And not just any lawyers. Lawyers who are paid very well to protect the company, not you.
You? You’re standing there with nothing but a dream and a 9-year-old employment agreement you probably forgot you signed… and a severance agreement you’re being pressured to sign now.If you’re not careful, this is where dreams die before they begin.
Your Old Agreements Can Come Back to Haunt You
Here’s what most soon-to-be entrepreneurs don’t realize:
That employment agreement you signed all those years ago? You’re still bound by it.
And it almost certainly contains landmines you never expected.
Non-competes, non-solicits, and confidentiality clauses that go way beyond “don’t steal our clients.”
Some of these clauses can prohibit you from working in your industry. Others prevent you from soliciting your own clients, even if they came to you first. Some contracts bar you from using knowledge or methods you developed.
And many are so broadly written, they apply not just to your old job, but to businesses your former employer might go into in the future.
Think that sounds crazy? Let me tell you a story.
A Cautionary Tale: The Engineer Who Didn’t Look First
Cooper was a highly skilled engineer who had worked for a large multinational company for over a decade. After a round of downsizing, he was laid off. Looking at the silver lining, Cooper saw this as an opportunity to start his own consulting business. He’d start off solo at first but with an aim toward growth once he got his sea legs under him. He even had a few warm leads from professional connections ready to work with him.
Before launching, Cooper decided to have his old employment agreement reviewed. It was something he signed nine years ago, back when he was just happy to have the job. He had forgotten about the non-compete clause buried in the fine print.
He thought the clause looked “standard.” But when his attorney inspected it, it turned out to be a monster with an overbroad scope reaching much further than he anticipated.
It barred him not only from working with competitors in his current field, but also from engaging in any work that could compete with any of the company’s existing or future business interests . . . including those of its many subsidiaries. The company had acquired dozens of companies over the years, spanning industries Cooper had never even worked in.
And there it was. The contract language with tentacles that stretched into seemingly everything.
The clause prohibited him from performing “engineering services for any third party whose business operations touch upon any technology, process, or method developed or researched by the Company or its affiliates.”
Translation: Cooper’s entire business plan was potentially off-limits. Just like that.
He was weeks away from launching. What now?
Severance Agreements: One Last Power Move
If you’re being offered a severance agreement, don’t let the pressure get to you.
Employers love to offer severance agreements with HR saying things like, “You should consult a lawyer, but this is agreement is standard”.
Let me be clear:
There is no such thing as a “standard” agreement when it comes to your future.
Many severance agreements will re-affirm or expand the scope of your existing obligations . . . including non-competes and confidentiality clauses. Others may offer a few months’ pay in exchange for signing away your right to sue or crippling your ability to support you and your family in the future.
Don’t assume your employer is doing you a favor. Their HR department is not there to protect you. Their lawyers didn’t write these contracts for your benefit. Their job is to reduce risk for the company, not for you.
And if you sign something without knowing what it means? You’re the one who’ll pay the price, not them.
Not All Restrictions Are Created Equal
Here’s the dirty secret they don’t tell you:
Not all non-compete or non-solicitation agreements are enforceable. And even among those that are, some can be negotiated or strategically planned around.
But you’ll never know unless you review them with someone who knows what they’re looking for.
- Some can be limited by geography.
- Others by time.
- Many depend on how they’re written. And whether your role actually fits the scope of the restriction.
Trying to figure that out on your own, without a lawyer and under pressure, while worrying about starting your business?
That’s not tactical. That’s dangerous.
Before You Leap, Protect Yourself
Look, we love business owners. Especially those starting something new. You’re the future of the economy. The backbone of innovation. But every successful business starts with a strong foundation.
And legal landmines left from your corporate life can blow it up before you even begin.
We help new business owners, consultants, and professionals make the leap safely. Without accidentally walking into a lawsuit, losing their severance, or killing their business before it starts.
But we don’t work with just anyone.
We’re selective in choosing our clientele. We only work with a small group of entrepreneurs and business owners every year who are serious about protecting what they’re building from Day One.
If that’s you, apply to work with us here:
Don’t go into talks without someone on your side.