Having the power to make decisions, working for yourself, and creating something new from nothing attracts millions of people. However, the responsibility for this shift in career from an employee to an owner may seem overwhelming for many workers. But there’s also a change in thinking needed as well as an entirely different set of action steps to manage.
This blog assumes that you are an employee who wants to become an entrepreneur and is interested in learning how to make the transition successfully. This blog aims to provide you with the information and resources that you need to achieve this goal. It will highlight the main areas in which the mindsets of employees and entrepreneurs differ and the steps that you can take to go from being an employee to being an entrepreneur.
Mindset Shifts: Employee vs. Entrepreneur
Once you are an entrepreneur, your mentality toward work will greatly shift. Here are some key areas where your mindset needs to adapt:
- Focus: Employees typically focus on completing tasks assigned by their managers. Entrepreneurs, on the other hand, need to take a more holistic view of business. They wear many hats, from strategy and marketing to sales and customer service. According to a Small Business Administration (SBA) study, nearly half of all small business owners (47%) reported working more than 50 hours per week.
- Decision-Making: Employees typically have limited decision-making authority. Entrepreneurs, however, are the ultimate decision-makers. This means being comfortable making choices with incomplete information and navigating ambiguity.
- Risk Tolerance: Employees enjoy the security of a regular pay check and benefits. Entrepreneurs, however, risk their own time and money on ventures that may not succeed. According to Entrepreneur Magazine, the failure rate for new businesses is around 20% within the first year, and 50% within five years.
- Motivation: Employees are typically extrinsically motivated, meaning they respond to external rewards like salary and praise. Entrepreneurs are intrinsically motivated, driven by the desire to create something of value and be their own boss.
- Time Management: Employees have a set schedule determined by their employer. Entrepreneurs need to be masters of their time, prioritizing tasks and becoming comfortable with multitasking. A Time Management study found that entrepreneurs spend an average of 2.5 hours per day on administrative tasks.
Taking Action: Steps to Becoming an Entrepreneur
Now that you’ve identified the entrepreneur within yourself, it’s time to take action:
- Identify Your Business Idea: What problem are you passionate about solving? What need can you fulfil that others do not? Conduct market research to validate your idea and identify your target audience. According to a Forbes article, 90% of startups fail due to a lack of market research.
- Develop a Business Plan: This document outlines your business goals, strategies, and financial projections. It’s a roadmap for success and can be used to secure funding.
- Build Your Skills: Identify the skills you need to run your business effectively. This might involve taking online courses, attending workshops, or finding a mentor.
- Test Your Idea: Don’t invest a lot of time and money upfront. Start small by testing your idea on the side or developing a minimum viable product (MVP) to gauge customer interest. According to a Startup Grind article, 64% of startups pivot their business model after launching their MVP.
- Secure Funding: There are many ways to fund your business, including bootstrapping (using your own money), taking out loans, or seeking investment from angels or venture capitalists. A Kauffman Foundation report found that the average amount of angel investment in the United States is $250,000.
Remember:
Be Patient: It is worth saying that creating a successful company is not simply easy and fast. Some days will be better than others and it may take you through several iterations until you find the right formula.
Embrace Continuous Learning: The business environment is ever dynamic. Continuously acquire knowledge and skills to ensure that your business is not left too far behind by rapid changes in technology.
Find a Work-Life Balance: With entrepreneurship often being so time consuming, failure to focus on yourself can often have detrimental effects on one’s health and inevitably lead to job fatigue. Develop good work-life boundaries and learn how to take naps.
The Employee to Entrepreneur Journey: A Rewarding Leap
In becoming an entrepreneur, a person is making a major career change. If you can adjust your mind, accordingly, act, and establish your support network, there is a high chance you will build a successful business and fulfil your entrepreneurial aspiration. The process of reaching for excellence is also a learning experience since it is characterized by accomplishment and failure. Therefore, do not fear but rather, leap into the journey of entrepreneurship as you wait to see your business concept fructify.
Building a Support System
Creating a business is a lonely endeavour. Surround yourself with other enterprising individuals, business coaches or consultants who can provide you with meaningful assistance. Take opportunities such as joining online communities, attending networking events or finding a business incubator program.
