Your Own Business vs. Employment
Written by Roman on January 13, 2008 – 2:38 pm
Time to time I read articles that discuss what the best choice is – to get employed or run your own business.
There is no silver bullet for this question. Business and employment are much related to each other, otherwise business owners would never find employees and employees would never get a job. It’s a matter of your personal taste. It’s like a choice whether you want to work in small or large company.
I guess it would be interesting to talk about my own experience of working as employee and then as small business owner.
Your personal time
Employment – normally, you work from 8 am to 5 pm with one hour lunch break. The rest is your own personal time that you can spend however you want. I was working long hours, but that was my personal choice. Excepting several times, nobody ever asked me to stay late or come to work on week-end.
Own business – during the first year I had no personal time at all. Then, after my son’s birth, I started to spend 1.5-2 hours each evening having a walk with my kid. Also, my wife won the battle of having Saturday as a family day when I try not to even starting up my computer.
My normal working day now is 12 hours. I took my first two-weeks vacation 20 months after we had started the company. During my vacation I checked and replied all my e-mails daily, and I was working for a few days as it was needed.
Independency
Employment – yes, you have kind of dependency on your employer. But, it’s not very clear who depends on whom. In Sweden, you cannot get laid off easily – probably only in case if you come drunk to the office, or you turned down the company network downloading porn movies, or your company gets closed. It’s also kind of winning a lottery to be laid off in Sweden – you get enough money to live your normal life within several months until you get another job. Also don’t forget about pretty powerful social support from the government.
Own business – as my ex-boss said before I quit, he was the only one I reported to when I was employed. In your own business you will report to and be responsible for a lot of people: customers, partners, sub-contractors and so on.
In addition to the politics inside your organization, you have to learn the politics your customers play with. Last year one of the officials asked for the shares in our business promising sales and public awareness about our product. We rejected the offer, and recently it came to my knowledge that several large contracts haven’t been closed last year thanks to him. Enemies can kill your business, but sometimes you have no other way rather than getting more enemies.
Mobile Phone
Employment – I used to switch off my mobile phone before I went to bed.
Own business – the phone is always on as customers or colleagues can call any time complaining about the eventual issues. Such night calls happened only once or twice for the last year, but still phone is on as you never know what happens next.
Risks
Employment – probably the most risky thing is to get laid off. You also get depression together with eventual financial troubles as it’s not funny at all to get laid off.
Own business – in case your business fails, you might pay your debts back for many years. And you get depression too.
Lifestyle
Employment – you get a paycheque regularly. The amount in your paycheque defines your lifestyle.
Own business – since the majority of income comes back to business, we spend only reasonable amount of money for living, buying things we really need. It’s kind of downgrade for me comparing to my lifestyle when I was employed. Sure, in case of successful business you will probably never remember the financial difficulties, but nobody can guarantee the success.
Career and Power
Employment – there is for sure the fighting for better position, better salary and more power.
Own business – probably, no career issues if you are the only one in your company. If not, then you might face difficulties if you haven’t carefully discussed and signed your partnership agreement.
Knowledge and Experience
Employment – it depends on your job, but it depends even more on how you feel about your job. Even at boring work of making and fixing setup programs you can find something funny to learn and new ways to implement it.
Own business – new experience and knowledge is the most exciting part in running your own business. You learn how to deal with customers, how to keep your accounting in order, how to negotiate and a lot of other stuff.
My company is kind of game for me – it’s funny, it’s risky, and it’s scary. But I like it 
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January 18th, 2008 at 11:54 pm
I’m following your ongoings with great interest. I’m planning to start a business here in Dubai in about a years time. Just being here for 6 month now I’m learning the in and outs in dealing with customers, local policies, laws etc. Basically, I want to partner up with the (US Multi-National) company I currently work for and sell/implement their software. Besides the knowledge I’m developing, I’m currently saving the capital to keep me going through the first year. In addition, you have to settle the order within 30 days and then see how fast you get the money back from the customers, which is not always an easy operation in the middle east. Sufficient funds to finance larger deals in advance are necessary. Another missing bit of the puzzle is finding a good partner, as you already have mentioned in your blog.
Running my own business was always like a dream to me and my absolute goal in life. Working for an employer, there are only so many hours per day where you can earn money. When running your own business, potentially the sky is the limit.
I also believe, once you run your own business, you have a chance to be very creative and can explore many other ideas you get. Being overloaded working for someone else, the mind just doesn’t get that piece of freedom. I might be wrong here, how does that work for you?
Greetings
Robert
January 19th, 2008 at 11:55 am
Robert,
that is partly true that you will get tones of new ideas as soon as you start working for your own. Also, your positive mood will attract right people - in the beginning I even met couple people literally on the street who have helped me a lot. They just popped up from nowhere, and we keep contact for already two years.
The problem is that you still have only 24 hours per day, and you will have to pay attention to many aspects for running your own business that are not directly related to the way you earn money - like making contracts with your customers right way, all the paper work with bank and company licenses and so on.
Also keep in mind that running your own business means you have to keep your eyes on the cash flow, so instead of working for employer to receive your pay cheques, you will probably spend a lot of time to run some activities that bring you money keeping your business running. And that prevent you from implementing other ideas, especially if you cannot employ enough people.
Anyway, what I want to say is that your own business is the good thing and you will learn a lot. But it is not easy, and there is no guarantee the business will be successful or make really good profit.
Good luck with your business!
February 17th, 2008 at 8:24 pm
[…] Written by Roman on February 17, 2008 – 8:24 pm My two weeks vacation has just finished. As usually, I checked my e-mails daily, and even worked from dawn to dusk for couple of […]