If you've just been laid off from a tech job, you have three real options and about ninety days before one of them gets chosen for you: take the next job, go fractional or consulting, or build a product. The right answer depends on two numbers (your runway and your minimum monthly income) and one honest question (whether you want to build something of your own or just wanted a better job). This guide gives you the decision, not a pep talk.
- Week 1: do the money maths. Runway in months, minimum monthly income, severance and notice. Everything else waits.
- Under 4 months of runway: take the next job, and start something small alongside it.
- 4 to 9 months: run two tracks. Interview for roles and sell one fractional or consulting engagement. Whichever closes first tells you something.
- 9+ months: you can build. Fractional or consulting first, product second, because services pay within weeks and software pays later.
- Severance is seed money. Spend under €500 of it on the business. Spend the rest on time.
What should you do in the first week after a layoff?
Do the maths before you do anything else, including updating LinkedIn. Four numbers:
- Runway. Savings plus severance, divided by monthly fixed costs. Write the number of months down.
- Minimum monthly income. Not your old salary. The number below which things break.
- Time to first paycheck by option. A new senior role in tech takes 3 to 6 months from first application to first salary in 2026. A first consulting or fractional client takes 4 to 8 weeks if you sell to your network. A product takes 3 to 6 months to first revenue if you pre-sell, longer if you build first.
- Unemployment and notice. In most European countries you're entitled to benefits that don't stop because you're exploring; check whether self-employment income affects them, because in some it does. In the US, severance and state benefits vary; know your state's rule on part-time income.
Then take a week. A real one. The decisions you make in the first seven days after a layoff are made by the part of you that wants the feeling to stop. Let it pass.
How do you decide between a job, fractional work and a product?
| Runway | Do this | Why |
|---|---|---|
| Under 4 months | Take the next job. Start a small advisory or product on the side once you're in. | You can't sell well when you need the money this month; buyers can tell. Get the income stable, then build from strength. |
| 4 to 9 months | Two tracks at once: interview for roles and sell one fractional or consulting engagement to your network. | A client that closes in six weeks changes your negotiating position on the job, or replaces it. The interview loop tells you what the market pays for you. |
| 9 months or more | Build. Services first (fractional, consulting, advisory), product second. | Services pay in weeks and teach you what to build. Software pays later but grows past your hours. Sequence them; don't pick one. |
The question underneath the table is whether you actually want to build something or just wanted a better job. Both are fine. If you don't know, the fractional track answers it in eight weeks at low cost: you'll either enjoy owning the outcome for a client, or you'll miss having a team and a company around you. That's data.
How do you use severance without wasting it?
Severance is seed money, and the most common way to waste it is to spend it on the business instead of on time. A domain, a Kit account, a Stripe link and a Notion page cost under €100. The first version of everything I've built cost less than €500. What the money buys is months of not needing the first client to pay this week, which is what lets you price properly.
Three rules: don't incorporate until you've invoiced twice (a sole-trader setup is enough almost everywhere to start); don't buy a course or a coach in the first month; don't build a product before you've sold a service to the same buyer. The product comes from what the service teaches you.
What do you sell if you go fractional or consulting?
An outcome you've delivered more than once, to a buyer who already pays for it. Not "product strategy". Not "growth". Something like "first PLG onboarding flow for a B2B SaaS between $1M and $5M ARR", or "hiring plan and first two hires for a Series A engineering team". The what to sell after tech guide walks through finding it; how to become a fractional executive covers packaging it; fractional rates by role covers pricing it.
Sell it to people who have already seen you deliver it. Former colleagues who left for other companies. Founders you've helped informally. After a layoff you have one advantage most people don't: a reason to message everyone you know without it being weird. Use it. Ten specific messages ("I'm taking on one client for X from November; who do you know dealing with Y?") beat one LinkedIn post announcing you're "open to opportunities".
When should you build a product instead?
When you have nine months or more of runway, or a service business already paying the bills, and a workflow you know well enough to build for. The cost of building has collapsed: I built Mazo, a B2B SaaS, in a weekend with no coding background (here's how). Building stopped being the hard part. Validation and distribution are, and a product with no audience and no pre-sales is the slowest way to your first euro. The micro-SaaS guide covers pre-selling and the first ten customers.
What if you'd rather take the next job?
Then take it, and don't let anyone who sells courses tell you that's a failure. Most of my clients are employed. Half of them start their business alongside a job, which is a better way to start than from a layoff, because you sell from strength. If you go back in, keep one thing: the list you made in week one of the outcomes you've delivered and the people who've seen them. That list is the business, whenever you decide to start it. Starting fractional work while employed shows how.
Find out which business fits you before you pick one
If you're deciding between fractional, an agency, a product or an audience business, the free Builder Diagnostic sorts it in about 3 minutes, based on how you actually work rather than what's trendy. Do it in week two, after the maths and the rest.
Run the Builder DiagnosticQuestions people ask
Should I start a business right after being laid off?
Only if you have nine or more months of runway, or you start with a service (fractional, consulting, advisory) that pays within weeks. With less runway, take the next job and start something small alongside it.
How long does it take to get a first consulting client after a layoff?
Four to eight weeks if you sell a specific outcome to people who have already seen your work. Longer if you start from a LinkedIn announcement and a generic offer.
Can I use severance to start a business?
Yes, and you should spend almost none of it on the business itself. Under €500 covers a domain, email tool, payment link and a page. The rest buys you months of not needing the first client to pay this week.
Is it better to go fractional or build a product after a layoff?
Fractional or consulting first. It pays within weeks and teaches you what the buyer will pay for. Build the product from what the service teaches you, once income is stable.
Does taking a new job mean giving up on my own business?
No. Most people who build a business after tech start it while employed, and it's a stronger position to sell from. Keep the list of outcomes you've delivered and the people who saw them; that list is the business.