No, this isn’t some pseudo-legal question. Quit smoking the peace pipe. This is a serious question that most entrepreneurs have asked themselves, or will ask themselves at some point. Through the multi-tasking, the late nights where you’re burning the candles at both ends, you might be wondering this right now.
Entrepreneur vs Self-Employed
“Oh no… I quit my job working for someone else to start my own business, and now I make less money and work even harder. The stress never ends!”.
This is the dreaded nightmare that many people who start their own businesses fear, or forget to fear. You see, there is a huge difference between being a true entrepreneur and being self-employed.
Just because you started a business does not mean you are an entrepreneur.
It means you’re self-employed.
Entrepreneur = You own your business.
Self-Employed = Your business owns you.
I was reading the E-Myth: Revisited by Michael Gerber (Great book. You should read it.), and he talks about this very subject. Most people have this fantasized image in their head of the glorious life of an entrepreneur.
They’ve seen the YouTube videos of the Tai Lopez’s of the world driving around in Lambo’s and Ferrari’s. They’ve talked to their brother-in-law who works for himself and is making bank.
They think, “Man this looks easy. If Chad (The douchebag brother-in-law) can do it, I can do it 10x better!”.
Famous last words…
Are You Sure You Don’t Want To Be An Employee?
Seriously. Be honest with yourself. Are you sure you wouldn’t prefer working for someone else? Are you self-employed purely for the purposes of satisfying your own ego?
Check out this video by Noah Kagan on why it’s completely 100% okay to be an employee. Just be honest with yourself. Entrepreneurship, being self-employed, whatever… it isn’t all sunshine and rainbows. In fact, most of the time it’s like dancing on hot coals while juggling knives with two blades at both ends.
Escape the Self-Employed Trap
If you haven’t already, you should check out the article we recently published on the Cash Flow Quadrant. You’ve escaped the Employee Quadrant by starting your own business. Now it’s time to escape being self-employed, and move up to where you own your business, instead of it owning you.
It’s time to make your business an asset, rather than a liability.
How? How exactly do you do that?
1 – Reinvest Back Into Your Business
Are you pocketing all of your profits? This a huge mistake. How do you expect your business to grow and flourish if you are suffocating the capital required to let your business blossom? Just like a bodybuilder needs food and protein to build muscle, love it or hate it your businesses protein is money.
Now maybe you have a new business and don’t have the resources to initially layout a bunch of capital. If you’re in this category you, you have more time than you have money.
Reinvest your time.
What does that mean? Stop going out on the weekends. Stop going out for coffee in the morning and killing 2 hours of your day on unproductive things. This is just the reality as a new business owner/self-employed person.
However, if you have been in business for a while and do have capital to reinvest, go back up and reread the bodybuilding example. You are doing yourself a huge disservice by hoarding your businesses profits.
And by the way, there’s many ways to reinvest your capital. To name a few, hiring employees and increasing your marketing budget are a couple of ways that can pay you back dividends.
2 – Learn To Delegate
This is one of the biggest themes in the E-Myth: Revisited (Hint hint: Read the book). As a self-employed person, you are fulfilling the majority of roles in your business. You’re the Customer Service Rep. You’re the Accountant. You’re the Manager. You’re the Marketing VP. You’re everything the business needs, and then some.
Hiring someone else to fulfill these roles for you.
“But I don’t wanna pay someone for something that I can do myself”.
Loop back up, and reread point number 1.
Are we on the same page now? Good.
3 – Limit Micromanaging
This can be tough to overcome, especially if you’re used to doing everything by yourself. However, it is deadliest thing you can do for your business.
I’m not even exaggerating.
Sure, you’re the boss. I get it. But if you can’t let go of the nitty-gritty details on how to do things, just close up shop right now. Seriously.
Micromanaging is lethal in every way, if you overdo it.
Your employees will hate you for it. You will create a work culture and environment that is toxic, which will then reflect in your employee’s (the people who represent you and your company) behaviour. Your customers, and clients will take notice of this.
Your employees will most likely quit (If they’re smart). You’ll have to take over the reigns on things again. You’ll hate your life for it, because of the freedom you’re sacrificing to go back and work in your business. Your customers and clients will notice your angst and frustration.
It’s just a bad situation all around that could be easily prevented by empowering your employees to take charge and be creative, rather than belittling them and treating them like children.
That said, when you’ve got a new employee (Remember, they’re an investment) you will have to micromanage them to bring them up to speed. But once they’ve got it, once they’ve understood their role and what’s expected of them, let them be.
You’re their mentor, their leader. Lead them when they fall off the path, but don’t over correct them or you’ll run the risk of disempowering them by overmanagement. Remember, these are people you’re dealing with. They have the freedom to quit.
Pay attention to the 4:10 mark in the video.
4 – Be Honest With Yourself
There’s your perception of reality, and then there is reality.
If you like to follow Tony Robbins, or the “self-help” industry, there’s this line of logic that your sense of wellbeing is based around your thoughts. That’s the time to use your perception of reality to your benefit.
When s*** hits the fan, and things are going wrong, that’s the time to assess the situation. That’s the time to match your current perceived situation to the reality of the situation.
When things are going bad, be honest and remember that your life isn’t a complete failure. Remember that you’ve still got something good going on in your life. Be honest with yourself in that sense.
But also be honest with yourself in your bottom line.
If your expenses are way out of whack, and you’re not bringing in enough revenue to cover your costs, don’t sit in a corner with a chipper attitude singing “Kumbaya”.
Realize that something is wrong, and fix it.
Be honest with your emotions, but also be honest with the hard numbers of your business.
Positive vibes help with the stress, but they don’t help when your expenses outweigh your revenue.
5 – 9/10 Times Your Customer Is Right Every Time
This one baffles me. There are some self-employed people in this world who think that they are smarter than their customer.
As Donald Trump would say, “Wroooong”.
Now there are some customers who are just trolling you, or they are real pieces of work (They’re real a******s). That’s fine. Don’t do business with those people. Your job is to service nice, sane, smart people. You don’t have to do business with everyone.
Now as a new business owner/self-employed person, it can be difficult to live by that code. But it’s by following this that you will take control of your business, and not let it run you.
Your goal as a self-employed person is to relinquish your role as the business owner and operator, and become the business owner. If you have the resources to reinvest into your business in the form of better marketing, or outsourcing your role as an employee in your business, do that.
If you are a newer business owner that is self-employed, you’re just going to have to get used to eating a bowl of nails for a period of time until you can reinvest into your business. As a newer business owner/self-employed person, you are going to have to invest your time instead of money. So no more going out on the weekends.
Sorrrry… that’s the reality of being self-employed. But hey! You are in the right direction towards living life on your own terms.
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Thanks for reading.