Entrepreneurship Vs Employment: Key Differences from Experience

All my adult life I’ve been either an employee or an entrepreneur.

There are a lot of people wanting to know the key differences between the two, and I want to share my thoughts on a few key areas from my experience both as an employee, and an entrepreneur.

So, here are 3 areas where being an employee and an entrepreneur contrast significantly.

Money

The financial aspect of entrepreneurship vs employment is an important topic, and it’s important to understand the differences between the two.

You see, when it comes to employment, there’s much less room for growth, and in truth, the income potential for entrepreneurship is much higher.

When you’re an employee, you start at $X.

After each year, you’ll get a pay rise, say $X + 5%.

So, every year, you’re gradually increasing your income at a steady rate, assuming who you’re working for is performing well.

So, your money goes up steadily each year at a fairly constant rate.

When it comes to entrepreneurship, you also start at X.

Except in this scenario, X is 0. There’s no “starting salary”.

You’ve got to go and earn it for yourself.

But, when income picks up, it doesn’t always increase steadily like an income.

It’s more often like a parabola.

You start with 0, and it can be difficult to get off the ground.

But, once you gain some momentum, you’re not limited to a 5–10% annual raise like an employee, and in truth, the sky’s the limit.

You could begin to see exponential growth with good systems.

So, the potential income is much higher with entrepreneurship, but you need to account for a small period of time where you might not be earning at all.

Risk vs reward.

This window of time varies for each person, but it’s important that if you want to make the switch, you’re well backed financially so you have the time to get your business off the ground.

Or, take the risk free approach, and do both at the same time.

It’ll be hard work, but you eliminate a lot of the risk.

Stress & Difficulty

Stress comes in all different ways, so I’ll give you my take.

Stress for me comes from not knowing what’s going on, and not being in control of a situation or scenario.

At my old job, I used to get stress when I was scheduled in for a meeting that I wasn’t told about.

• “What’s this about?”

• “Am I in trouble?”

• “What’s going to happen?”

Or when someone gives me something to do that involves people/software etc. that I’m unfamiliar with.

It’s all about unknown outcomes, and I don’t have this problem as much, with entrepreneurship.

There’s no denying that the harder of the two is entrepreneurship.

Entrepreneurship is about sales and problem solving. That’s pretty much it.

But the reason I find it less stressful is because I’m in control of everything.

If something goes wrong, I face the consequences, and I’m responsible, and other people aren’t affected.

That, to me, makes it less stressful, and less anxiety inducing.

But, I can’t speak for everyone when it comes to this.

Being an employee is significantly easier than being an entrepreneur, but for someone with drive and ambition, this isn’t always a good thing.

• You become lazy.

• You become comfortable.

• You become complacent.

• You lose drive and motivation.

With entrepreneurship, you’re constantly hungry for success, and laziness is something that you’re forced to give up.

I mean sure, there’s a steady stream of income when your an employee, but it’s like a Lion sitting in a cage at the zoo.

The easy life. Is it really what’s best for you?

What I’m trying to say here is that yes… entrepreneurship is way more difficult than employment.

But the thing is… that’s a good thing, because nothing worth achieving is ever going to be handed to you on a silver platter.

Freedom & Control

This was the exact reason why I turned to entrepreneurship.

Now, before I get mistaken, I want to say this.

Entrepreneurship isn’t easy, nor is it about…

• Taking it easy.

• Being flexible.

• Choosing your own hours.

You have to work hard. Harder than you did as an employee, but that’s a good thing.

I made that choice knowing it was going to be the toughest thing I ever did.

But, the beauty about entrepreneurship is this.

Don’t get is twisted, you need to work your butt off, but…

You no longer have to build your life around your work

You can build your work, around your life.

You’re no longer restricted by working hours, and you can cut out all the wasted hours on…

• Commuting

• HR

• Meetings

And all that rubbish.

You work, and you live your life, and that’s the beauty of becoming an entrepreneur.

Efficiency. You work on what matters, and that’s it.

The amount of great habits I’ve started since becoming an entrepreneur has been huge, and I’m a different person to the one that was an employee:

• Going for daily walks.

• Waking up & working earlier.

• Running & exercising.

• More time with family.

• And on top of all this… I still work longer hours.

This level of control is something you do very well to get when you’re an employee.

But for entrepreneurs? We all have it.

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