The smartest thing an entrepreneur can do happens before they quit their day job

Thiago OlsonThiago OlsonTime is crucial, says Engage Ventures managing director Thiago Olson (pictured).

You need money, energy, and a great idea to start a business.

But sometimes, the most important ingredient is time — and you want to start thinking about it before you quit your day job to go out on your own.

“Be realistic about the amount of personal runway that you have,” Thiago Olson, managing director of Engage Ventures, told Business Insider. “Everything is going to take two times as long as you think. And if you’re in hardware, it’s going to take three times as long as you think, initially.”

Olson is speaking from experience.

At the age of 17, he established a reputation as a “teen prodigy” by building a homemade nuclear fusion reactor. Before moving to the venture fund space, he worked for the US Department of Defence and then became the CEO of digital payment card company Stratos. Today, his venture fund is backed by Delta, UPS, Invesco, AT&T, Home Depot, and Intercontinental Exchange. So far, it’s raised $US15 million, according to Crunchbase.

He has a tip for entrepreneurs who are just starting out: Be meticulous about your timeline. It’s usually better to overestimate the amount of time it’s going to take your business to get up and running than underestimate it.

“Make sure that’s kind of built into the calculations, so you don’t get into a pinch,” he said.

He said creating a more accurate picture of the time it will take will allow you to focus more energy on the important things — namely, cultivating your team in the early stages of the business.

“As a startup CEO, your main responsibilities are attracting talent on your team. It’s really all about the initial team,” he said. “Solo founders statistically have a much lower rate of success. Having someone at your side, at least one other founder that if nothing else is going through it with you, that is key.”

NOW WATCH: Ideas videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.