Most people make the mistake of confusing a self-employed person with an entrepreneur. And we cannot blame them, because, often seen as one and the same, an entrepreneur and a person who is self-employed may share the similarity of owning a business.
Beyond that, though, they begin to stray down vastly different paths.
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Who is an Entrepreneur?
An Entrepreneur typically describes a person who is inventive, creative, and a risk-taker. As an innovator, they must be ambitious with a strong sense of business.
When an Entrepreneur has a groundbreaking idea or product, they will often apply for a patent, which can be a lengthy and costly process. Start-up costs are also sometimes expensive with production and/or inventory, but nevertheless, they carry on with their plan, as they should.
Entrepreneurs use their critical thinking skills to achieve their goals, make smart business decisions, and utilize marketing skills that they have learned. If you are the kind of person who wants to build a self-sustaining business to sell at a later date for profit or to pass on to their family, then an entrepreneur role with an original, interesting idea is the way to go.
A Self-Employed Person
Working for yourself is similar to entrepreneurship, except that most individuals in this position did not “invent” the product or profession they are pursuing. Most often, the service or item already exists. They are generally just performing the same job as others they are supervising.
However, some of the same qualities and skills of an entrepreneur may apply to a self-employed person. You must be flexible; no more specified schedule or “passing the blame” to anyone else… you’re it. The Alpha and the Omega. You will be responsible for all decision-making and solving all crises.
If you are self-employed, you definitely need to be motivated. There is no one to tell you what to do or when to do it. You must be able to plan ahead and use your time wisely. The customers will expect your full attention and availability, as well as one hundred percent of your effort. Irrespective of what your line of product or service may be.
Being self-employed is stressful, no doubt. Profits may come immediately, or it may take you six months to a year to see financial gain.
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Entrepreneur vs Self-Employed
An entrepreneur is all about risk and reward. They think outside the box for the best ways to succeed and move on to their next venture. And while the business might be of interest, it is really the passion of the start-up and leading something to success that drives them every day.
This is why they can often sell the business or move on to start a new one once they have everything set for the future.
Typically, though, the majority of business owners fall under the category of “self-employed”. They begin with a skill or particular set of skills and find that the opportunity to make money arises. This is where the crash course in business begins. From insurance and licenses to accounting and marketing, many owners are soon smothered in the infinite amount of hours required to keep the business alive.
While most self-employed people are still the “owners” of the business, they typically carry all the responsibilities of an employee. This combination of duties can create many limitations on the success of the business. Essentially working anywhere from 2-10 jobs, self-employed people are often overworked, underpaid, and lucky to get a few days off a year.
Self-employed people work perpetually irrespective of the contractors or employees they have hired. Whereas for an entrepreneur, the business is on auto-pilot mode, and they have the remote control to manage the business. Therefore, the business can run even if the entrepreneur is physically absent for a while as they have a complete business overview.
Even if the owner retires or dies, an entrepreneurship venture will continue to operate because the other employees are working with the founder and not for the founder. Therefore, they understand the mission, vision, and values of the business. For example, Apple Inc. continues to operate even after Steve Job’s demise.
For a self-employed person, though, if the owner retires or dies then the company will cease to exist.
SEE: Employee Attrition: Meaning, Effects and How to Avoid It
In Conclusion
When taking a deeper look, we see a major difference, being that the self-employed person is the business, whereas an entrepreneur operates a business. Or perhaps one could say that experience defines the difference.
Whichever it may be, whether you are an Entrepreneur with an innovative idea or hoping to be your own boss as a self-employed individual, a certain amount of bravery, persistence, and risk is involved when starting a business from the ground up.
That being said, with many qualities overlapping, where do you see yourself categorized below?
| Entrepreneurs | Self-Employed |
| Flexible | Quality Conscious |
| Creative | Hard Working |
| Confident | Goal Oriented |
| Passionate | Good Communicator |
