19 questions (but we need 20)
People are getting buyout offers. Should they take them?
Over the last six months, one company after another — to say nothing of the federal government — has started offering buyouts to many thousands of employees to try to get them to quit.
I know quite a few people who have considered buyouts like this — and sometimes, considering using the payouts as seed capital while they launch a business of their own.
So, I thought about what I'd say if someone asked me if I thought that they should take a buyout and start a business. I think I'd take some of my own advice about giving advice, and instead try to suggest some good questions to ask themselves so they can make a better decision.
I came up with 19 questions. I'd love to hear your reactions: whether you're thinking about something like this yourself, how you'd advise someone who asked, or what you think should be the missing 20th question.
Let's dive right in. Here are my 19 to ask someone considering this:
1. Are you a good employee?
There’s no right answer to this one, but many successful entrepreneurs say they could never have been truly happy working for someone else.
2. Would you consider quitting and launching a business if there were no buyout offer?
All other things being equal, it’s a better position to be in, to have some kind of severance or buyout when you’re launching something new. But, would you be thinking about doing it, even without?
3. Do you have other income or savings?
Pretty important question. Add up your buyout, your income, your savings: What’s your runway on any new business? When does it have to make money, and how much?
4. Who do you support, and who supports you?
The math is different for would-be entrepreneurs considering giving up a steady paycheck if they're supporting kids or other family members. Also: Who would support you while you launch, either emotionally or financially or in a different way? A spouse? Partner? Parents? Friends? Someone else? Very important.
5. What’s your plan for health insurance?
Huge for American entrepreneurs, since for many of us, health insurance is tied to our employers.
6. What problem would your business solve?
O.K., here we’re getting into the business idea itself, which is worthy of an entirely separate newsletter (or several). But one key way to judge a business is to ask what problem it solves, and for whom it solves that problem.
7. How would you get your first client or customer?
Worth asking over and over. In part because you need that first customer, and the answers might help you with the next question, too.
8. How would you get 10 clients or customers?
There are some businesses that can thrive with just a few customers. But all other things being equal, it’s better to have more.
9. What can you do to cut expenses and stretch your runway?
This is probably a good time to go through your credit cards, make sure you and your spouse or partner aren’t both paying for the same video streaming services, etc.
10. Physically, where will you work?
At home? In an office somewhere? At a co-working space or coffee shop?
11. If you don’t take the buyout, what does your future look like?
I almost don’t want to expand on this one, because it’s better open-ended. Think about your future. Does it excite you?
12. Would it would be a surprise to others at work if you took the buyout?
Answering this one might tell you what life will look like at the company if you stick around.
13. Is your industry in trouble?
It’s probably not a coincidence that I worked as a government lawyer and a journalist and that I know a lot of people considering buyouts, since neither of those industries seems like a growth opportunity right now. How does your industry look?
14. Are your peers and best coworkers taking the buyout?
Make your own decision. But it’s worth knowing what your peers are doing.
15. Who will advise you and work with you?
You might be at the very beginning of answering these questions, but start asking. Entrepreneurship can be very lonely at times. Plus, most successful business leaders ultimately say that the key to their success was finding the right people to work with.
16. Imagine what life will be like 5 years from now if you start and fail?
The last four questions are related; they’re also more focused versions of 12. But many businesses fail. If you put everything into yours and come up short, what do you think you’ll do next?
17. Imagine what life will be like 5 years from now if you start and succeed?
This is the fun hidden toward the end; everyone wants to imagine success. But at the same time, think about what true success really looks like to you. Is it having a high income? Loving the work you do every day? Being your own boss? Carving out work-life balance? Something else?
18. Imagine what life will be like 5 years from now if you take a buyout, but move on to another job?
This is very likely what most employers offering a buyout expect will happen. And it might be fantastic! Maybe even better for some people than launching a business.
19. Imagine what life will be like 5 years from now if you don’t take a buyout?
What a question to wrap with: the road not taken. But just because you’re being offered a buyout doesn’t mean you have to take it. And sometimes the best possible move is not to move at all.
My work is done
Of course, I can’t offer answers. I only get to do the fun part, which is to suggest the first 19 questions and ask you to come up with the proverbial 20th.
Still, I have a feeling a lot of people are grappling with these kinds of decisions right now, or will be soon, so I hope it’s a helpful exercise.
If nothing else, the whole experience of forcing yourself to be a bit introspective like this drives home a comforting truth: Even if one chapter of your professional life might be about to end, an even more exciting one might be just about to begin.
7 other things worth knowing
When House Republican leaders rushed to leave Washington for a long August break, they seemed desperate to quell the anger among their supporters about the Trump administration’s backtracking on a promise to release files related to its investigation of the accused sex trafficker Jeffrey Epstein. But halfway through a five-week congressional recess, the clamor shows little sign of quieting. (The New York Times)
Ukrainian President Volodymyr Zelenskyy and Trump expressed hope that Monday’s talks at the White House could lead to trilateral talks with Russian President Vladimir Putin to bring an end to Russia’s war on Ukraine. A group of European political leaders also met with the U.S. president on Monday after they were left out of Friday’s summit. (AP)
Inside the blitz to hire 10,000 more ICE agents quickly: $50,000 signing bonuses, $60,000 student loan forgiveness, no college degree needed, age limits removed (minimum age: 18, no maximum age), and higher base pay than most state and local police. "America has been invaded by criminals and predators," the agency says on its recruiting website. "We need YOU to get them out." (WSJ)
Thousands of people gathered in Israel over the weekend to call for an end to the Gaza war and a deal to secure the release of hostages held by Hamas. A one-day national strike - part of wider protests - closed roads, offices and universities in some areas. (BBC)
Texas Democrats who left the state to stymie Republicans over redistricting have returned to Austin, ending a two-week standoff over President Donald Trump’s plan to carve out five new GOP congressional seats. The drama in Texas set off a national redistricting battle, most prominently with California Gov. Gavin Newsom vowing to retaliate against Texas Republicans by extracting an equal number of Democratic-leaning districts from California’s congressional map. (Politico)
D.C. restaurants saw a more than 25% drop in diners in the days following President Donald Trump’s takeover of the city’s police department, according to data from OpenTable. As the National Guard began being mobilized, reservations were 27% below their 2024 levels. DC’s restaurant industry – one of the worst hit in the country by pandemic shutdowns – had previously seen 11 consecutive months of year-over-year improvement in reservation numbers. (WUSA-9)
A library book has been returned nearly 82 years after it was borrowed from the San Antonio Public Library. “Your Child, His Family, and Friends” by marriage and family counselor Frances Bruce Strain was checked out in July 1943 and returned this past June from a person in Oregon. The library said in a news release that it eliminated overdue fines in 2021. (NBC News)
Thanks for reading. Photo by Julien Photo on Unsplash. I wrote about some of this before at Inc.com. See you in the comments.
Very good questions. I'm old, retired, and have started a few businesses in my life. One of the BIG questions I always ask in these situations is, Why am I one of the ones being offered the buyout? It's an often overlooked question which one always needs to be asking. The best and most valuable employees usually are given raises to stay in these situatiions. Am I as good as I think?What do I need to improve?
These question circle around starting a new business AND the buyout offer. I would disconnect the two and deal with first things first. You also need to clearly understand the entity’s overarching objective of the buyouts as well as your BATNA.
Manage the complexity by focusing on questions 11 and 13. If enough staff does not take the buyout then layoffs will be next. Question 20 could focus on that aspect of the decision. Taking a chance on being impacted by a RIF is a crapshoot. A buyout places you more in control and typically increases the length and benefits of the off-ramp. In the end it typically becomes an exercise in math for the entity.