Entrepreneurship

[Baltar]

Originally Posted by ahimel

you ARE the legal department, the marketing department, the customer service department, the R&D department.... You work way more than 40 hours a week. So if the business you're trying to build will take a lot of time in an absolute sense, then stick to being an E while you build it.

I personally can't agree with that. First of all, I've always hated being an employee in general, regardless of what kind of work I did. But even if you can tolerate it, it's still a HUGE waste of time. When I was an employee I was expected to stay at work until a certain time of day. It didn't matter if I was doing work or not, that's just what was expected either explicitly or through peer pressure. At one job we were officially supposed to be at work from 8:30 am to 5:00 pm, but the boss unofficially told us through our manager that he wants us to stay until 5:30. Steve had written already that most employees do like 1.5 hours of work per day, so keeping people around longer simply wastes their time.

Another thing I resented about having a job was that it didn't matter how hard I worked. I would still be paid the same exact amount every week. That was pretty depressing for me, because I'm a self-starter and I want to work hard and get rewarded for it. When you're self employed, how much you get paid is directly proportional to how much effort you put in. That said, I do agree that service based self employment (where you are essentially a freelancer) is not a true solution. As a freelancer the only advantage you have is setting your own hours, which is certainly a step up but not enough.

The best way to go is to create streams of passive income, which will require a lot of work initially but once set up will give you true freedom. However, if you try to build this up on the side while remaining an employee, it'll take you many more years than if you were to dive into it fulltime, simply because of how much time you'll be wasting by being an employee.

[garg]

Very interesting link. I'm also interested in that book now

I always was under the impression that self employed is more or less the same as owning a business.

What is the difference between being self employed and owning a business?

[helgi]

Originally Posted by Baltar

But even if you can tolerate it, it's still a HUGE waste of time. When I was an employee I was expected to stay at work until a certain time of day. It didn't matter if I was doing work or not, that's just what was expected either explicitly or through peer pressure. At one job we were officially supposed to be at work from 8:30 am to 5:00 pm, but the boss unofficially told us through our manager that he wants us to stay until 5:30. Steve had written already that most employees do like 1.5 hours of work per day, so keeping people around longer simply wastes their time.

I could not agree more. And to me even just the feeling of being trapped in a meaningless schedule all day every day is enough to warrant an escape, regardless of money. I would honestly rather live frugally if needed doing my own thing than having more luxury and a 9-5 job.

I did however come across an interesting read today, at Escape from Cubicle Nation, that talks about how simply approaching your existing job in an entrepreneurial way can help make it more bearable, if for some reason you can't quit your job as soon as you'd like to:

Is entrepreneurship a state of mind or state of employment?

btw., it is incredibly comforting to hear from others that don't like the idea of being an employee.

[Baltar]

Originally Posted by garg

What is the difference between being self employed and owning a business?

The generally accepted view is that when you're self employed, you own your job. When you own a business, you own an asset that can work without you. In a true business you have other people work for you (employees), and you don't need to be involved in the day-to-day operations for it to continue functioning.

[Leonard]

Originally Posted by Baltar

I personally can't agree with that. First of all, I've always hated being an employee in general, regardless of what kind of work I did. But even if you can tolerate it, it's still a HUGE waste of time. When I was an employee I was expected to stay at work until a certain time of day. It didn't matter if I was doing work or not, that's just what was expected either explicitly or through peer pressure. At one job we were officially supposed to be at work from 8:30 am to 5:00 pm, but the boss unofficially told us through our manager that he wants us to stay until 5:30. Steve had written already that most employees do like 1.5 hours of work per day, so keeping people around longer simply wastes their time.

Another thing I resented about having a job was that it didn't matter how hard I worked. I would still be paid the same exact amount every week. That was pretty depressing for me, because I'm a self-starter and I want to work hard and get rewarded for it. When you're self employed, how much you get paid is directly proportional to how much effort you put in. That said, I do agree that service based self employment (where you are essentially a freelancer) is not a true solution. As a freelancer the only advantage you have is setting your own hours, which is certainly a step up but not enough.

The best way to go is to create streams of passive income, which will require a lot of work initially but once set up will give you true freedom. However, if you try to build this up on the side while remaining an employee, it'll take you many more years than if you were to dive into it fulltime, simply because of how much time you'll be wasting by being an employee.

Not that I'm contesting against your point (i see yours too), but ahimel made a good point as well. I'm also running my own business, and one thing I realised about the good in keeping your day job is the constant flow of income which you can subsequently pour into your own business. I didn't really like what I was doing as an employee previously, and jumped onto the bandwagon immediately. I didn't regret that choice. However, I wouldn't mind a 2nd stream of income for a few more months before quitting for good.

Nevertheless, when you really enjoy what you are doing, and knowing whatever time and effort you have put in, is into building your own empire, every sweat is worth dropping.

[DmitryDavydov]

Originally Posted by norbert

I believe building businesses that serve hundreds of clients and feed hundreds or thousands of employees is a MUCH bigger contribution to the world than being the programmer I'd be if I had chosen the employee path, creating desktop applications for Microsoft Windows. Does this clarify what I meant by that?

Well, yes, if you are going into business FOR YOUR OWN REASONS, not to make the world better. Like I said, I'm all for business, but to go into business to make world better - thats pop-psychology nonsense. You have to take care of yourself first, before you are able to help others. And a lot of times you don't even need to help people intentionally. Just sticking to your business may help plenty of people - your employees, your accountant, marketing companies, local newspapers, etc.

[birger]

Originally Posted by norbert

Are there any entrepreneurs in these forums?

I started my own business three years ago, but it's mostly been a sleeping business. I have a regular job (40%) and still studying in university college (100%), so it doesn't leave me with much time for my own projects.

[smashingred]

Originally Posted by garg

What is the difference between being self employed and owning a business?

The E-Myth
Anyone in this thread should read Michael Gerber's E-Myth Revisted. In it he explains the difference between being an entrepreneur and a technician and shows you the path to a "World Class Business". Most small businesses, he says, are "people who do technical work having an entrepreneurial seizure."

What he means is that if you are a computer programmer and you work on projects and do all the technical work you are a technician. That is not a true business and it certainly isn't being entrepreneurial. Doing the work of an entrepreneur is building a business that frees you from doing technical and managerial work.

Your New Boss (You) is an ___________!
Gerber has also said in a couple of recordings what I think sums up the truth, "You fired your old boss and became self employed only to find that your new boss is an a--hole."

Free Yourself of Technical Work
I am working to become an entrepreneur. This means that one must be able to move beyond doing technical work. Freelancing (which I do now) is technical work. Building a system whereby I can have others do my work for me is entrepreneurial. I dream of turning my so-called business into a thing larger than me and is not dependent on me or people but on the systems on which the business was built.

Another Kicker at the Can
Rich Schefren is another guy (who has obviously spent time reading Gerber's book) who talks about freeing onself from the act of doing all the work. He even has a really great graphic in his eBook, Internet Business Manifesto, where he has a mindmap of all the responsibilities of an online "business owner". It is quite funny as there are nearly 100 posts for the one person to fill.

OT: Jill, it is great to see you here as the Mod. I have been reading your NL for over a year and got to know you some from the SBIF .

OT: MattInglot, great to see you here. Been reading your blog mattinglot.com/blog since the spring. Missed you for a while.

All the best to all,
Jay

[Jill]

OT: Jill, it is great to see you here as the Mod. I have been reading your NL for over a year and got to know you some from the SBIF

Thanks, Jay!

And yeah, e-Myth rocks! I'm about to start using their elearning materials to write up my new business plan.

[wilsonng]

Originally Posted by Leonard

That's a great point. Many people actually have the intentions of running their own business, but are afraid to take the first step. Some are not young, and have families to support, so the thought of giving up their job and salary turns them away from being self-dependent. It's a harsh reality. If they fail, and look to being an employee again, chances of them getting their last drawn salary is rather low (at least where i am based, that would be the case).

IMO, you don't have to quit your job to be an entrepreneur.

There are many things you can start to engage in part time. And it actually is advisable that you don't plunge in first without getting your feet wet in testing the waters first.

[wilsonng]

Originally Posted by Baltar

The generally accepted view is that when you're self employed, you own your job. When you own a business, you own an asset that can work without you. In a true business you have other people work for you (employees), and you don't need to be involved in the day-to-day operations for it to continue functioning.

that is looking at it positively.

If you have a job and it doesn't work out, you still have an income. yOu're just unhappy.

If you own a business, you have costs to cover. If it does not work out, you not only have no income, you may be actually be bleeding money.

Please don't misunderstand. I am not discouraging entrepreneurship, but it is important that people are aware of the upsides and downsides of it.

[ahimel]

Originally Posted by garg

What is the difference between being self employed and owning a business?

Quick test -- what would happen if you left for a year to travel the world, and didn't do any work?

Our business relies on me answering the phones, and Adam going out to people's houses to fix computers. If neither of us was here for a year, we'd have no income, and come back broke. We're self-employed.

Steve gets income from people reading his back articles, and people buying his products online. If he left for a year, traffic would go down, because there are no new blog entries to read, but he'd still have income to come back to. Since he makes more than twice as much as he spends, I think it's safe to say that if he left for a year and did nothing on his website, he'd still have a good income source when he came back. Steve owns a business.

[Steve]

Originally Posted by ahimel

Steve gets income from people reading his back articles, and people buying his products online. If he left for a year, traffic would go down, because there are no new blog entries to read, but he'd still have income to come back to. Since he makes more than twice as much as he spends, I think it's safe to say that if he left for a year and did nothing on his website, he'd still have a good income source when he came back. Steve owns a business.

I'm not sure I would say he owns a business, although I agree that he would still have money coming in if he did work. However, that is true of most authors, yet most don't consider John Grisham, for example, a business owner.

Musicians are another example. They can keep working and earn money from past works, but Brittney Spears is not a business owner.

Anyway, I guess it's all semantics. The point is that the goal is to have something that earns you money while you don't have to work.

[DmitryDavydov]

Originally Posted by Steve

but Brittney Spears is not a business owner.

Anyway, I guess it's all semantics. The point is that the goal is to have something that earns you money while you don't have to work.

As much as I hate her, I have to disagree. Lets take Disney, for instance. They make billions from licensing deals. If Britney agrees to license her face to some cosmetics company in exchange for money or a cut in sales or both, how is it different from Disney? Or a company that makes billions from Barbie doll. Or any other trademark owner?

Britney surely can be a business.

P.S. EMyth rocks!

[stuart]

Entrepreneur in Singapore here. I run training and personal development workshops. But I'm also an avid business coach, teaching people about stuff related to internet marketing campaigns (you can read that short article I did) as well as search engine optimization (my pet hobby). Been at it since 1997. Wow... time flies.

[psychicbilly]

Very good discussion going here.

When you're going self-employed I think its important to be doing something you love. I also think its better to be self-employed than working for someone else. Is forming a business partnership more likely to achieve success quicker than being a sole proprieter?

[sbdiane]

I made almost $20 selling avocados. I sold them on the honor system while I went for a hike, while I relaxed with a magazine, while I went out for coffee. I was an entrepreneur for a weekend.

But seriously, I have dabbled in selling my technical services. I once made a decent sum on the side of my full time job. The government took so much of the money I made, the exhaustion of working so many long hours outside my full time job seemed no longer worth it.

It is interesting to read that Steve says most people only work 1.5 hours a day. I honestly did not know that, but that's how it has ended up for me time and time again. I hate the feeling of being trapped inside an office under the flourescent lights whether I have anything to do or not.

At one job, only having 1.5 hours a day of work to do and the freedom to go home early, I had very little to tether me to the job and I lost interest. I attempted first to save my job by admitting that I wasn't working the full day and wanted more responsibility, more to do. I had ideas of new things I could work on. They did not fire me for that admission but they made my life miserable, treated me in ways that I'm sure were illegal but so sneaky I wouldn't be able to prove it, and then told me in the exit interview I would not be elligible for rehire. I guess I exposed the secret that my boss' job existed only so she could be at a salary above her work. My job was a fake job.

So whatever you do, if you are an employee working a fraction of the time, keep it to yourself. Pretend you are all harried and hectic. That must be what everybody else is doing.

I have ended up in other 1.5 hour jobs after that one. I never want to be in a position like that again. I want to try working for myself, even if it is just being a technician selling my services. The avocados were a nice passive income generator, making as much as my web site does in a month. But I'll need to sell my time and skills if I really want to be self-employed. Thing is, whenever people say entrepreneur I don't picture someone like me, or the guy who cleans pools, or even the self-employed graphic designer. I picture more of a wheeler-dealer type. That's not me. Can low-key, non-salespeople be entrepreneurs too?

[Pixel Ink]

I've been an Entrepreneur since 96 and supporting myself strictly online since 04. See signature if curious. It's nice to know there are other web focused entrepreneurs in here.

[Marty McFly]

If anyone in the U.S is looking for a business partner in the U.K, I am all ears.

[sunj]

Yeah taxes will drain you. Once you hit that 60 hour mark, law of diminishing returns kicks in. At 60 hours (40 hours regular + 20 hours overtime) of work you will be at the peak. Anything after that you are working for the gov't. I'm starting on my entrepreneur path and I'm checking up on what kind of taxes [and rates] are out there. The one I hate the most is property tax. This totally screws up my thoughts on buying a nice big house on the lake. I can end up paying $10,000-$20,000 in taxes per year.

[ABdude]

Its kinda odd that I stumbled upon this thread when I did, because I found a potentially great business opportunity, provided I can come up with the capital for the start-up costs.

I have stated in other threads that I have a degree in computer networking, and at times have done freelance work for certain individuals. Currently I work as a truck driver for a recycling company, however in a few months, the city will be taking over and I will be out of a job. However, last month I went to visit some family in another city, where I found out that not only do they not have any sort of business doing residential recycling, but that a fair number would be interested in such a service. I am currently in information gathering mode, trying to talk to as many small business owners as possible to find out grants, and resources for starting my own business. My plan is to move and find a full time job while in the beginning stages of my business, then phase out the job gradually so I am fully supporting myself via my business.