Many people dream of launching the startup that will make them millions of dollars and lead them to respect and success within their industry. There are many things about entrepreneurship that sound good. You’re your own boss. You can set your own hours. You’ll be working towards your vision, and not another person’s. What’s remarkable is that in spite of this, very few people take the steps to open their own businesses, and those that do, often quickly return to working for somebody else. This is because entrepreneurs and employees differ in personalities, world view, and priorities. This doesn’t make one better or more hard-working than the other. In fact, one of the goals of this article is to dispel the notion that entrepreneurs are hard-working and ambitious, while employees are simply clock punchers with no vision. If you are considering the life of an entrepreneur, here is a bit of information that may help you to decide if this is the life you want.
Entrepreneurs and Employees: The Myth of Passion
If you choose to become an entrepreneur, many people will assume that you have an exceptional amount of passion for your work. While this may be true, there is no reason to assume that an entrepreneur is more passionate than an employee. In fact, an entrepreneur must split their days between financial planning tasks, marketing, dealing with human resource issues, and accomplishing a laundry list of managerial and operational tasks. In a given day, they may not actually get to spend a large amount of time doing the work that got them into the business they are in. On the other hand, an employee may spend ninety percent of their day, specifically doing the work that they love.
None of this means that the entrepreneur is not passionate. It’s just an indication that the entrepreneur and the employee might be passionate about different things. For the employee, it may be the work itself that drives them. For the entrepreneur, it could be the concepts of ownership and creation that keep them going. These differing passions bring up the next difference between employee and entrepreneur.
Generalization and Specialization
When an entrepreneur launches a business, it may be born of a specific skill or talent that they have, however as the business grows, it is inevitable that their attentions and talents will be divided between many areas. This leads to them knowing a little bit about many things. Employees on the other hand tend to know a lot about one or two things. This often means that their expertise is more in depth than the entrepreneur, but unlike the entrepreneur, they are often lost if they are expected to perform in another area.
The Risk/Ownership Trade Off
If somebody passes up an opportunity to go out on their own as an entrepreneur, their reason for doing so is often that they do not wish to take on the risks of launching and running a business venture. They are more comfortable giving up the benefits of ownership such as growth, notoriety, and income growth in order to avoid the drawbacks such as loss of personal savings. Entrepreneurs take on the risk, and expose themselves to the possibilities of any resulting rewards. Of course, this difference cannot always be attributed to willingness.
Resources and Support Systems
Not all differences between entrepreneurs and employees are due to personality, preferences, or ability. Some are due to life circumstance. As a whole, entrepreneurs have more resources and stronger support systems than employees. This might include personal financial resources, or friends and family members who are willing to invest or give emotional support. These resources often mitigate the level of personal risk they take on if they should decide to open their own business. There are many people who remain employees in spite of having a strong entrepreneurial drive, simply because they lack those resources.
Differing Views of Failure
Entrepreneurs are accustomed to failure. Most successful business owners make several missteps when developing their businesses and even more missteps when they run those businesses. Because of this, they learn to embrace failure as a learning experience. Failure isn’t something that they take personally. It is something that they embrace as a way of learning where changes and adjustments need to be made. Employees, on the other hand, dread failure. This is often because failure is directly tied to performance reviews, and performance reviews are directly tied to compensation and promotions. Employees also tend to take failure more personally, because it often indicates a weakness in their expertise or a lack of proper resources and training in the workplace.
After Hours Priorities
When an employee is out of the office and they are not on call, they tend to focus on family and leisure activities. Employees want to fit in as much entertainment and relaxation into their down time as they possibly can, because they have little time to fit this into the work day. On the other hand, entrepreneurs spend more time focusing on planning, education, and personal development during their off hours because that is the time they have to plan for the future both personally and professionally. None of this is to say that entrepreneurs never have time for family and entertainment. They simply have less down time than employees, even when they are physically away from their place of business.
A great employee will assume accountability for themselves and those in their charge. This means taking the lead on solving problems that exist, and preventing problems that may occur in the future. If they are leaders in addition to being employees, they also feel as if they are accountable for the professional development of their underlings. A great entrepreneur assumes accountability for an entire organization and the professional development of all of their employees. In addition to this the entrepreneur is also accountable to their investors.