Should Your Best Employees Be Moonlighting?

Jeff Rumbaugh was one of the most interesting bosses I ever worked for. I hope I get this story right, but he told me the Bob Parsons story when he worked as a company controller in Moberly, Missouri. This was many years before he founded GoDaddy.

As I recall from Jeff, Bob would go home at night and program software. He liked it and was good at it. This was at a time when software was sold through mail-order advertisements in magazines.

His boss was Barry Orscheln, and according to Jeff, “Bob, you either need to be a programmer or be my controller.” Initially, Bob opted for a secure paycheck. But the creative juices kicked in, and he traded his quill for a keyboard. While the experience was stressful, he eventually sold Parsons Technology to Intuit for more than $60 million, where he was based in Cedar Rapids, Iowa. Once his non-compete expired, he was off to building his next big venture.

Did Barry understand the concept of no moonlighting while holding down a critical management position? I believe the answer is, “Absolutely.” About fifteen years later, he shared some insights into his convictions on this matter, as I was also interested in selling a software package after starting work for his family business.

Mark’s Moonlighting Confession

I think the statute of limitations has expired; I can now come clean. In 1992, I completed a consulting gig outside of my W-2 position for about nine weeks. I worked on the project during weekends and evenings, and I also took some PTO so that I could visit my client, who is two states away.

Thankfully, I had a good modem, and I could do all the work in my living room. Accordingly, virtual work existed in the 1990s. That lone project was the reason I became a consultant about thirteen years later. I loved owning the results of my recommended deliverables. I loved hearing how pleased my client was, not just the CEO, but the other managers on that leadership team.

I still have mixed feelings about doing that consulting project. I still worked hard at my W-2 job, the same family that Bob Parsons worked for. My family enjoyed the money even though we put 100% of it toward debt elimination. However, I also recall the advice Barry Orscheln gave me a few years later, which now solidifies my stance on employee moonlighting.

Mark Thinks He’s the New Cognos

About two years after that consulting job, I conducted financial due diligence for a potential merger between two large farm stores in the Midwest. Yours truly built an economic model using Excel and Access. I hated it because I couldn’t make it do what I wanted it to do. But there were few alternatives.

During that period, I fell in love with a software product called Monarch, which enabled the extraction of spooled reporting files from mainframe systems and the conversion of these reports into flat data tables.

During that retail project, I observed our buying agents conducting intensive analysis, reading SKU-based reporting in three-ream binders. To me, that was lunacy.

In a matter of minutes, I could use Monarch to read the spooled reports, convert them to flat tables, concatenate the tables via an Excel query, and then create numerous Pivotables for this massive detail.

Our President and buyers had thought I had conquered Mt. Everest. I had not, because the process was easy, but I kept that to myself.

Until I found a tool called Pilot for our leadership team, which replaced my existing toolset, I had my heart set on Cognos. Cognos was still new to the data analytics world (again, this is the early to mid-1990s), but I loved the potential of the tool. Our biggest obstacle was the cost. Pilot was cheaper and still good, so we bought it.

During this discovery process, I thought, “I wonder if other farm stores have this same issue?” So, I became Bob Parsons for a few weeks, even though I couldn’t program. I ultimately replicated my Excel-centric tool in Access because it handled data management far better.

At the advice of a peer, I bought a ticket to Vegas to show my tool to about fifty farm store retailers at a conference. Attendees expressed interest, but I was quickly learning that I was not a marketer, sales rep, or even a programmer. Who would support the tool? I had no business plan, only a curious mindset to see if I could turn an idea into a software solution.

So what happened next? I was saved. And by an unlikely source.

The Day My Company Reimbursed Me

Here’s where my memory is murky. Somehow, Barry Orscheln learned about my software idea. He called me to his office to ask me questions about it.

I’ll never forget the story he told me about a manufacturing employee running a cleaning business on the side. He wasn’t concerned about it until he drove past him one day on Morley Street — in the middle of an afternoon when he should have been at the plant. He was driving his cleaning company truck.

He didn’t tell me what happened with the cleaning guy, but I think I have an idea of what happened. Barry gave me some great advice that might turn some people off.

“Mark, when you’re mowing your yard or doing your running thing, I want you thinking about my business, not your side hustle.” That made perfect sense to me. My company reimbursed me for every out-of-pocket cost I incurred, including my trip to Vegas. In return, I gave the company my software, my heart, and my soul until I left the organization.

My Strong Convictions on Employee Moonlighting

I work with a business that has a team member selling commercial and residential real estate on the side. I don’t like it. I know he takes real estate calls during the day because he has to.

The bottom line is that we cannot serve two masters equally well. Either one will perish, or both will. Michael Hyatt once said, “He who chases many rabbits chases none.”

There are always exceptions to the rule. My dad raised cattle while working at DuPont. One of my favorite HR directors owns a few rental properties, but her husband handles most of the hands-on work. Her outside interest never interferes with her primary job.

One of the most significant problems I have with employee moonlighting is the message it conveys to the entire staff.

I was the CFO-Controller for a small $22 million newspaper and commercial printer. Todd M. was my fixed asset accountant, and he handled our tax work before we sent it to our external CPA.

Todd loved tax work. He loved it so much that he created a small tax service for mainly blue-collar employees. While he was working for me, he had nearly 60 clients.

I tolerated his side gig until I heard him say, “Todd M. CPA, how can I help you?” several times during tax season, after his cell phone would ring.

Todd and I would later have a little come-to-Jesus meeting. I allowed him to keep his side hustle, but he could no longer take calls on my time. Did he? I’m not sure, but he received the message, and my small ten-person team appreciated my visit with him.

In Todd’s case, I was concerned that his work would compromise the quality of the work I had given him. He was a great accountant. My issue with him was optics. It didn’t look good.

Accordingly, not every moonlighting situation is the same. However, I generally do not like knowledge workers engaged in other businesses on the side. Remember the two masters quote above.

Bob Parsons Made a Decision He Never Regretted

Again, my memory is imperfect, but I recall Jeff (mentioned above) stating Bob reached a fork in the road in the late 1980s. His customers wanted tax software to do their taxes. He could only complete the work if he worked on it full-time.

But there was a catch. The leasing company where he worked in Moberly, Missouri, not only paid well, but he was assured of a $30,000 bonus after the calendar year flipped. That was a substantial amount of money back then, money that could have been put to good use in his software company, which he ran on the side.

But according to Jeff, he decided to go for it. No serving two masters. Instead, he would serve just one.

I’ve never met Bob, but from what I can gather from the media, he appears to have a good heart and enjoys sharing his wealth. He’s the one who should be discussing employee moonlighting, not me. It’s his story and advice I received from his old boss that reminds us to dig beyond the surface when dealing with this issue with key staff members.

Bob’s story also suggests that we should let the employee decide what’s most important and then make a decision to either work for you (your company) or theirs (the employee’s company).