The Hard Truths Of Being A Business Owner
Not everyone possesses the inherent qualities necessary to thrive as a business owner. Drawing upon my personal experience in both realms, I stand poised to impart some illuminating perspectives. The allure of working for oneself may appear enticing, especially when one finds discontent in their current job or bears animosity towards their superiors. However, in Australia, being an employee might indeed hold superior advantages.
Regrettably, only a small minority of individuals can secure a job that truly brings them fulfillment. Most are consigned to toil in unsatisfying or unfulfilling positions solely to meet their financial obligations. Whether one chooses to acknowledge it or not, money exerts a considerable influence over our lives.
Delving into the statistics provided by the Australian Bureau of Statistics, it becomes evident that approximately 77% of start-ups manage to survive their first anniversary. However, of those, nearly 48% falter and perish within four years or even less. These figures, though significant, fail to capture the sheer number of businesses barely managing to stay afloat.
Furthermore, there exist those who perceive themselves as business owners but, in truth, merely find themselves self-employed, toiling ceaselessly for over 80 hours a week within their ventures.
Undeniably, the realm of launching a small business proves to be a fiercely competitive arena, where conditions often tilt unfavorably. Nevertheless, those with the resilience to endure can reach for greatness. Moreover, the allure of limitless monetary rewards stands in stark contrast to the confines of a fixed salary.
However, prospective entrepreneurs ought to bear in mind that embarking on this path is no fleeting excursion into rainbows and glamour. Before contemplating entrepreneurship, one must sincerely ask themselves: Do I possess the tenacity and aptitude required to flourish as a business owner?
Business Owner Or Employee
If I were to contemplate an ideal place to be an employee, Australia stands out as the epitome of my preference. The nation boasts relatively favorable wages along with a host of benefits. These include annual leave, sick leave, paid maternity leave, and superannuation, among others.
In my opinion, depending on the industry, most Australians enjoy a commendable work-life balance. The advantage of being an employee lies in the ability to leave work behind once the day concludes. Thereby affording the luxury of disconnecting and relishing personal time with loved ones. Although occasional stress may arise, there exists a threshold beyond which work does not overpower one’s life.
The average salary enables employees to embrace a comfortable standard of living. Although it is worth acknowledging that financial stress has recently affected many Australians—a topic I shall refrain from delving into at present.
Conversely, as a business owner, the luxury of dissociating from the business is often elusive, depending on the chosen business structure. In certain instances, the weight of overwhelming stress looms daily, making it challenging to switch off even after regular business hours.
Entrepreneurs may find themselves engrossed in the operational aspects of the business, diverting focus from its improvement. This reality is particularly pronounced among small businesses that lack the resources or capital to engage skilled managers. This results in many proprietors working arduous 80+ hour weeks, overburdened and often making minimal wages.
While this does not necessarily imply an inevitable outcome for everyone, it remains a plausible scenario that demands awareness. To steer clear of such a situation, one may wonder what measures can be taken to safeguard against it.
Business Owner Meaning
Distinguishing between being a business owner and being self-employed holds significant importance. These two roles are often confused as being the same. A business owner can preside over their enterprise without necessitating direct involvement in day-to-day operations.
Such owners frequently rely on competent management teams to handle the intricacies of running the business, although they may occasionally engage in its affairs.
Conversely, those who actively work within their business because daily operations would cease, can be considered as self-employed. While many business owners commence their journey in this capacity, it becomes crucial to contemplate the transition away from such dependence.
Renowned investor Warren Buffett astutely remarked, “I am a better investor because I am a business man. And a better businessman because I am an investor.” . This profound statement resonated deeply with me upon first hearing it.
In my personal experience, when I launched my initial business venture, I still maintained employment under someone else. I had entrusted a manager with overseeing daily operations. Alas, after three years, I fell prey to the statistical fate mentioned earlier. Though financial losses ensued, the experience proved remarkably rewarding.
It was only thereafter that I ventured into the stock market, fervently seeking to augment my knowledge of investing and business. The time I devoted to studying exceptional businesses and the art of investing opened my eyes to the missteps of my past.
Without a doubt, had the sequence been reversed, with an initial foray into stock market investing preceding my business venture, the latter would have stood a stronger chance of success.
To be a true business owner requires adopting a distinct mindset. One’s primary focus should not be to toil within the business but rather to optimize operations, hire capable staff, and efficiently allocate capital.
You Too Can Succeed
The news is replete with captivating tales of visionary businessmen who rose from humble beginnings. Yet, what we see is their immediate success not all the failures they experience. Nor the hard ships that they had to endure.
While statistics may paint a bleak picture of business failures, one must not allow the prospect of failure to dissuade them from pursuing their entrepreneurial dreams. After all, every great business, including illustrious names like Apple, Microsoft, Adore Beauty, and Kogan, commenced from a home garage. Even the esteemed Elon Musk encountered a near-bankruptcy ordeal with Tesla.
Indeed, those who have never tasted failure have perhaps never truly embraced the endeavor of creating something remarkable. Yet, it is essential to recognize that venturing into business is not suited for everyone.
Curiously, I have known friends whose businesses thrived. But upon selling their ventures, they pledged never to tread that path again. Conversely, there are individuals who, despite encountering failures, remain inexorably driven to keep trying.
This diversity of experiences underscores the multiplicity of human nature. Some passionately revel in entrepreneurial pursuits, while others find it ill-suited to their disposition. Nevertheless, for those with an itch to scratch and a yearning for fulfillment, starting a business can prove to be a gratifying pursuit. Even as one must remain aware that the voyage may not always be smooth sailing.
Should the weight of entrepreneurial stress prove too burdensome, it is perfectly acceptable to choose the path of an employee. An alternative path to business ownership, accessible to many, lies in the realm of stock market investing, which grants ownership without the arduous toil.
Within our land of boundless opportunities, a myriad of paths awaits those seeking success, you only have to take the leap.
Key Takeaways
- Australia offers favorable conditions for employees, including good wages, benefits, and work-life balance. The path to fulfillment may lie in stock market investing or other opportunities.
- Distinguishing between being a business owner and self-employed is vital. Business owners delegate operations to management, while self-employed individuals are integral to daily functioning. Adopting an investor’s mindset can enhance entrepreneurial success.
- Embrace the journey of entrepreneurship despite potential failures. Success stories often overlook hardships and business ownership suits some, but not all.
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