If you have a few years of design experience, you might wonder about the possibility of starting your own firm. After all, you probably have great ideas, a knowledge of who to target, and several connections with other designers. Owning your own design firm could help you make more money, put you in charge of all your decisions (including your schedule, and which clients you take on), and might give you a greater sense of inspiration and fulfillment on a regular basis.

But before you quit your job and start building your own firm, there are several things you should address.

What to Know Before Starting a Firm

Don’t start a design firm without considering these important points:

  1. You may be under a non-compete agreement. Many design agencies use a non-compete clause in their employment contracts to prevent designers from certain actions that could harm the employer. Depending on the wording, this may prevent you from working anywhere that also offers design work for a period of time following your departure from the agency. It might also prevent you from taking clients with you, should you move onto other opportunities. Check your contract carefully before you get too excited about starting your own firm.
  2. Reputation is everything. Design firms live and die by their reputation. If you do good work and are renowned for it, you’ll have an endless stream of new clients coming your way. But if you’re just starting out, you won’t have much of a reputation to work with at all. That means, you’ll have a harder time attracting good clients, and the work you take on might not be good enough to showcase in your portfolio.
  3. Decisions are harder than you think. The idea of making all your own decisions and being in charge of your own destiny is appealing, but the reality of decision making is far more complex. The decisions you make will have a substantial impact on your overall success, making each decision successively more stressful. And if you make too many decisions (as entrepreneurs tend to), you could end up with decision fatigue, which causes even more stress and anxiety.
  4. You’ll need to take care of your workers. Employees cost more than just their base salary or hourly rate. You’ll need to plan to pay taxes, along with worker’s compensation insurance. Depending on which state your design firm will be located in, it’s almost certain that worker’s comp is necessary to cover your workers if they’re injured or fall ill on the job (even if you’re not at fault).
  5. Client management is tough. In your current role, it’s fun to think about saying “no” to tough clients, and only bringing on the clients who can advance your career and be worth your while. Unfortunately, client management is tougher than it seems; you’ll have to carefully balance which clients you take on, and almost every client will have a significant downside, whether it’s a bad attitude or an inability to pay on time.
  6. You’ll probably need startup capital. Unless you have clients already lined up and revenue being generated, you’ll probably need some startup capital to get things moving. You’ll need to pay for office space, equipment, subscriptions for the software you’re using, and marketing and advertising expenses at a minimum. Unless you have spare money lying around, you’ll need significant capital to get started.
  7. You won’t be designing. Keep in mind that if you’re in charge of the design firm, you probably won’t be doing much designing. You’ll be making decisions that keep the design firm moving, meeting with clients, and managing employees. For some people, this is ideal, but if you’re passionate about design, you may feel detached after a few months on the job. Entrepreneurship is a different animal.

Is a Firm Right for You?

Though you may have all the skills and experience necessary to start a design firm, running a firm isn’t the best career move for every designer. Think carefully about what fulfills you in your career, what the real cost of running a firm is, and whether you’re up for the challenge. If you still feel good after doing your research, you’ll need to put together a business plan and find a way to start saving for startup capital. As long as you’re prepared, you’ll have a chance to succeed.

Leave a Reply