While you were reading the topic of this blog, I bet you the first question you asked was “But, isn’t it the same thing?”. Well, to be honest, yes and no. I just love those types of non-direct answers, don’t you? Yes, you are right, but no you are also wrong…
Let us start at the beginning of these two concepts.
In our professional careers of earning an income, we almost always start out by getting a job, thus an employment position earning a salary. Many people are happy to stay employees for the rest of their lives and there is nothing wrong with that. Some of those employees get to run some of the biggest businesses in the world.
Just think of a CEO of a big corporate business. At the end of the day, the CEO is still just an employee of the business they are running. Now, not all of us have the same appetite for risk and want to leave the relative security of a well-paying job.
Then there is the other half of the population… the entrepreneurs…
Entrepreneurs are individuals who know and believe that they want to own their own business and work for themselves. They do not want the security of a paying job and miss out on the “freedom” of being a business owner. They do not like to work for a boss every day and see how their hardworking labour is generating a profit and lifestyle for the boss. So they choose to start their own business.
This is where the heading of this blog, being a business owner or self-employed, will seem to be the same concept. As an entrepreneur, you are a business owner as you just started a business, which you own, and you are also self-employed because you no longer work for a boss, but you work for yourself.
Now it starts to get interesting! Does it always stay this way? Are you always a business owner and self-employed? Is it still the same concept? The answer to this is a clear and loud NO! The reason for this strong answer is that some entrepreneurs realise that to be a business owner, you cannot be self-employed anymore.
The very spelling and meaning of the word self-employed states that you employ yourself. You are merely employing yourself and you are still in an employment situation and mindset. Instead of doing a specific job for someone else, your previous boss, you are now doing it for yourself.
Business owners or entrepreneurs who are self-employed generally have no staff that work for them. Should they not be able to work, then the business cannot earn an income. This means that the business’ income or turnover is 100% dependant on the owner’s input and no one else’s.
The business owner mentality
The entrepreneur who moves from the self-employed mindset to the business owner mentality realises that they need to systemise their business to achieve continuity. They need to create a sales generating capacity that does not need their input.
Thus the business is able to generate sales and money without them working in the business. This is where the answer to the question above becomes a definitive NO. A business owner realises that he wants to own a business, he or she wants to own a system that is capable of generating sales, paying expenses and creating money for them without their daily input.
They know that they do not want to work 80 hours a week and be self-employed.
So, the answer to the question above, isn’t it the same concept? Definitely NO! In order for us to be entrepreneurs who really make a difference, we all need to strive to become business owners instead of being self-employed.