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Would you take a year off to start a business in a developing country?

November 16th, 2009 · 4 Comments

I had an interesting conversation with a friend this weekend.

John has been working at a technology company for eight years. He absolutely hates his job now. In fact, he wanted to leave immediately. But, because of stock vesting schedule, he has to wait for a few months. This company’s stock has been performing well. But, it’s also known for being a sweat shop, treating employees very badly. Eight years is a long time. John couldn’t leave during the eight years because he was waiting for his green card application to go through. He finally got his green card recently. He has been planning for the next chapter of his career.

Given his skill set and experience, he could easily get a job at another company. But, he just couldn’t get excited about working for any company. He felt that he had tolerated enough office politics. He has no interest to climb the corporate ladder. He wants to start his own company.

But, John also has to face realities on the personal front. He is in his early 30s, married with kids, and a mortgage. He is also the sole bread earner in his family; his wife is a stay-home mom.

His plan is to

  1. rent out his house
  2. move the family to his native country in Southeast Asia
  3. set up a outsourced software development shop to generate short term revenue while developing a product (he has been working on the idea for a while.)
  4. return to the United States to run his business once the product is developed and his development shop is profitable.

The living expenses in this particular Southeast Asia country is pretty low. For example, his monthly rent would be about $200.

Most of his family and friends don’t understand why he wants to do this. They think he is crazy: he has a good job at a well known, high-growth company whose stock is doing great. He lives in the beautiful Pacific Northwest. He has a very nice house and a very nice family. Why take the risk to move the whole family back to a developing country and start a business?

In fact, I’m the ONLY person who told him to "go for it!". 🙂

Let me explain my rationale:

  • John is only 32 years old. He is still young enough to take major risks. If he is in his forties or fifties, it’d be much harder and risky to take the risk he has in mind.
  • John’s wife has told him that she would give him one year to try out his "start-up experiment". Assume they stay in the Southeast Asia country for one year, their totally living expenses is probably going to be less than $15,000. He would also need to spend some money to set up shop. But, he has already had two small outsource projects to work on.  I think the financial risk is manageable — let’s say everything fails. John will not be broke and he will not put his family in any financial danger.
  • The opportunity cost will be one-year’s salary. But, the cost of living is also much higher in the United States. So, the opportunity cost of "one-year net income" will be pretty small for John.
  • He has always wanted his kids to learn his native language. There is no better place to learn a language than the native country! I asked him about health care cost. Apparently, quality health care is much cheaper there than the United States. Getting quality health care for his family will not be a problem.

Most importantly, it’s John’s dream to start his own business. I’m a big believer that everyone deserves a chance to take a risk once during life time to pursue what he or she is really interested in. A lot of people don’t have the courage or the resource to give themselves a chance. John might lose some money, but he has the rest of his life to earn the money back and more. What’s more precious is the experience of doing something he really wants and cares.

I told John that he might fail, but I’m pretty sure he will not regret.

Do you agree with me? What would you do?

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Excellent resources:

Tags: Start-up Success

4 responses so far ↓

  • 1 Anonymouse // Nov 18, 2009 at 8:45 pm

    High Technology sweat shop in Pacific Northwest? Its Amazon.com! I hope you changed names to protect John's identity.

  • 2 GeekMBA360 // Nov 19, 2009 at 1:08 am

    Thanks. I didn't say the company located in the pacific northwest. Also, names have been changed to protect confidentiality. But, thanks for pointing out the importance to protect people's identity.

  • 3 Anonymouse // Nov 19, 2009 at 1:45 am

    High Technology sweat shop in Pacific Northwest? Its Amazon.com! I hope you changed names to protect John's identity.

  • 4 GeekMBA360 // Nov 19, 2009 at 6:08 am

    Thanks. I didn't say the company located in the pacific northwest. Also, names have been changed to protect confidentiality. But, thanks for pointing out the importance to protect people's identity.

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