“I wanna make it cool for kids to get into tech, startups, and entrepreneurship – cooler than buying a bunch of jewelry.”
21 Savage, Musician
Pros and Cons of Being an Entrepreneur
Entrepreneurship has become quite popular over the past years.
Instead of working in a job, many people want to start their own business.
While being an entrepreneur can have many important advantages, there are also some issues related to it.
I know both worlds and give you all the pros and cons of entrepreneurship in the following article.
Advantages of Being an Entrepreneur
- High level of freedom
- Higher level of flexibility
- You don’t have a boss
- You can decide when good is good enough
- Entrepreneurship never gets boring
- You can outsource tasks to your employees
- You can do what’s right from an ethical perspective
- Can give you the opportunity to make more money
- You get the true returns on your work in the long run
- You can decide the dress code in your company
- Your motivation level will be higher compared to working for a company
- Being an entrepreneur allows you to follow your passion
- Time can be used as efficient as possible
- Entrepreneurship is cool right now
- You don’t have to rely on companies to give you a job
- You can work as long as you want
- Entrepreneurship can let you grow in character
- May increase your level of confidence
- You learn how to deal with pressure
- You have full control over the decisions in your business
High level of freedom
One important advantage of being an entrepreneur is the high level of freedom you will have throughout the day.
If you are your own boss, you can do whatever you want whenever you want.
Sure, you will have to take responsibility for the results in your company, yet you are free to decide when to take a break or when to work.
Nobody will be able to tell you what to do and you can do whatever you feel is right for the company all day long without having to listen to anybody else other than you.
Higher level of flexibility
Being an entrepreneur also gives you a high level of flexibility.
You don’t have to go to the office with a strict schedule, you can just sleep shorter or longer whenever you want to.
You will also be free to work from home in case you will not make it to the office that day.
This can not only be quite convenient for yourself, but it can also benefit your family life since you will be more flexible to take care of your kids and to bring them to school and back.
You don’t have a boss
Another upside of being an entrepreneur is that you simply don’t have a boss who can tell you what to do.
Instead, you can spend your day as you want to.
You can take a longer break or work without a break, depending on your mood on the respective day.
You can also decide what topics you want to work on that day.
For instance, if you just don’t like to bother with a certain topic, you can just skip it for now and come back to it later.
If you don’t have a boss, you will generally have the opportunity to do what you want to do instead of being forced into topics you don’t like at all like in a regular job.
You can decide when good is good enough
“Good work” is always relative and depends on the expectation of the respective person who evaluates your work.
If this person is you, you can decide when good is good enough.
In contrast, if you work for a company, you will always have someone above you who evaluates your work and who might not be satisfied with it.
Therefore, entrepreneurship also gives you the opportunity to decide how much work you want to put into the respective project and when it is time to move on to the next one.
Entrepreneurship never gets boring
From my experience, entrepreneurship never gets boring.
There is always something to do and you will be surprised how many different tasks will be on your mind.
Consequently, especially if you are a rather curious person who wants to try out new things all the time, entrepreneurship can be much more exciting compared to working for someone else.
You can outsource tasks to your employees
There are also many tasks that are not quite a lot of fun.
In fact, if you work for a company, you will often have to do things you don’t like at all.
However, if you work as an entrepreneur, you can just outsource most tasks you don’t like to your employees and don’t have to bother with those unpleasant things anymore.
Of course, this only works if you have good and motivated employees who take care of those rather annoying tasks for you in a decent manner.
You can do what’s right from an ethical perspective
If you work for a company, you may also be forced into things you don’t like from an ethical perspective.
As long as you are dependent on your company, you will often have no other choice than to follow the company culture and the overall course of the company, even though you might not share the same values.
Through entrepreneurship, you can do what’s right from an ethical perspective since nobody can tell you what to do as long as you obey the law.
Can give you the opportunity to make more money
While some jobs pay pretty decent salaries, most jobs will just not make your rich.
In fact, if you want to make a fortune, there is almost no other way than becoming an entrepreneur.
Only if you work for yourself, you can keep all the profits.
Hence, instead of making other stakeholders rich, you can make yourself rich through being an entrepreneur.
You get the true returns on your work in the long run
Entrepreneurship can also make quite a lot of sense from an overall justice perspective.
In fact, in the long run, you will get the returns you deserve since your own performance is directly linked to the success of your company.
Therefore, if you are good enough, you can make really good money while if you are not good enough, you will go out of business sooner or later.
Consequently, especially if you think you are better than most people, becoming an entrepreneur can make quite a lot of sense for you.
You can decide the dress code in your company
Many companies also have a fixed dress code and you will have to comply with it in case you want to work for them.
However, you might just not feel comfortable with this dress code.
If you have your own business, nobody can tell you what to wear and you can come to work in the clothes you feel most comfortable with.
Your motivation level will be higher compared to working for a company
When you have your own company, you will also be much more motivated compared to working for someone else.
This is quite logical since your performance will directly influence your salary if you are an entrepreneur.
In contrast, if you work in a job, your performance will only play a minor role for your salary and connections inside the company will often be more important for that.
In turn, many employees are quite unmotivated since they feel that their performance doesn’t matter too much anyway.
Thus, through entrepreneurship, it will be more likely that you will access your full potential and that you learn more in a given period of time.
Being an entrepreneur allows you to follow your passion
Another important benefit of entrepreneurship is that you can follow your passion.
In fact, many people build businesses around the things they love in life and will become naturally good at it since they want to do them all day long.
This can not only lead to a higher motivation to work, but it can also make you happier in the long run since you can do what you love instead of doing things you hate in your corporate job.
Time can be used as efficient as possible
If you are an entrepreneur, you can also not spend too much time on minor things that have no real impact on the success of your company.
You always have to use your time as efficiently as possible.
In contrast, in most jobs, employees spend far too much time on small things that do not actually contribute to the success of the respective company.
Consequently, by being an entrepreneur, you can learn how to make the most out of your time.
Entrepreneurship is cool right now
Being an entrepreneur has also become quite cool over the past decade.
In fact, instead of going to college and getting a corporate job afterward, many young people now aspire to become an entrepreneur.
While it has been the gold standard to work for a company for many decades, this now seems to change quite a lot.
Entrepreneurs gain in social status every day and if you are someone who cares about the opinion of others and wants to look good in front of your family and friends, entrepreneurship can also help you in this regard.
You don’t have to rely on companies to give you a job
Another important advantage of entrepreneurship is that you do no longer have to rely on companies to give you a job.
In fact, this kind of dependence is rather dangerous since you can just end up unemployed if the company you work for goes out of business or if the company simply no longer wants to employ you.
Many people will just no longer be needed anymore in the near future due to technological progress and the vast developments in artificial intelligence.
Hence, becoming an entrepreneur can also make quite a lot of sense to lower your dependence on the corporate world and to take care of yourself instead.
You can work as long as you want
If you are an entrepreneur, you can also work as long as you want.
In fact, if you don’t have a boss, you can just work your face off for one day and take a break the next day.
You will also be much more flexible regarding when to take a vacation.
Also if you want to start a family, you can decide to work fewer hours and spend more time with your kids instead.
In general, if you have your own business and don’t have a boss, you will have a much higher level of freedom to work as long as you want and you will also be more flexible regarding when to work.
Entrepreneurship can let you grow in character
Being an entrepreneur can also give you the opportunity to really grow in character.
You will often have to make decisions that could potentially have detrimental effects on your company.
You will also have to lead your employees and will also have to deal with difficult clients.
All this will really push you to the next level and you will learn how to deal with all kinds of stuff.
In turn, this will not only help you in the corporate world, but also to deal with several problems in your private life.
May increase your level of confidence
Entrepreneurship can also help you to become more confident.
In fact, since you will have to manage so many different things at the same time, you will soon become quite good at many different tasks and you will realize that you can do much more than you expected.
In turn, your self-esteem will increase quite a lot.
You learn how to deal with pressure
There is no doubt that entrepreneurship implies serious levels of pressure.
While some people break under this significant pressure, others really enjoy the ride and get stronger with every punch they get.
By being an entrepreneur for a long enough time, you will really learn how to handle pressure and how to deal with it.
This will not only benefit you for managing your business, it will also greatly help you in difficult periods of your life.
You have full control over the decisions in your business
Entrepreneurship also gives you the opportunity to keep full control over what happens in your business.
If you structure your company the right way and you have decent reporting mechanisms in place, you can make all important decisions instead of letting other people decide what’s best for the company.
If you work as an employee instead, you will often not have this opportunity since your bosses will just decide what’s good for the company and many times, you will not even be asked in this regard.
Consequently, if you are a person who really likes being responsible for the success of a business and wants to keep control over all important decisions, entrepreneurship might be the better way to go for your compared to working in a corporate job.
Disadvantages of Entrepreneurship
- Entrepreneurship can be lonely
- You will not have many friends among your employees
- Financial pressure can be enormous
- Especially problematic for businesses with high investment costs
- Your employees will mess things up
- You have full responsibility
- Unlimited liability for mistakes in your business
- You have to deal with difficult employees
- You will have to rely on business partners
- Entrepreneurship can imply excessive stress
- Only few people have the stomach for being an entrepreneur
- You will have to work longer than in most corporate jobs
- You may go out of business
- May lead to family problems
- You don’t have a guaranteed income as entrepreneur
- Many people underestimate how difficult it really is
- You will have no official vacation
- Many people have difficulties to unplug
- Responsibility for your employees
- Entrepreneurship can be bad for your health
- It takes a long time to build a serious business from scratch
- Entrepreneurship is risky
- Many people are delusional regarding what it means to be an entrepreneur
- Plenty of administrative work
- You may get sued
Entrepreneurship can be lonely
Apart from the many important benefits of being an entrepreneur, entrepreneurship also implies serious problems.
For instance, one disadvantage of being an entrepreneur is that it can be quite lonely.
In fact, you will have to make all the important decisions and will have nobody to blame other than yourself.
Especially in difficult financial times, this can really break people and you should not underestimate the emotional pressure that comes along with entrepreneurship.
You will not have many friends among your employees
Being the boss of your company also implies that you will not have many friends among your employees.
Friendships between bosses and employees are not that common and usually don’t last for too long in the corporate world.
Some employees will even see you as an enemy.
Hence, you will also have to deal with the fact that most people inside your company will actually not like you.
Financial pressure can be enormous
Another problem with entrepreneurship is that financial pressure can be enormous.
Especially in economic downturns, your business may experience serious losses and you have to handle these swings somehow.
However, many entrepreneurs struggle to save enough money in good times that they could use in bad times and get into serious financial difficulties once crisis times hit.
Moreover, due to our globalized world, entrepreneurship has become extremely competitive and you will have to compete with corporations from all over the world.
Most of the time, bigger companies will be able to produce at lower costs than you and this might lead to serious financial trouble for your company in the long run.
Consequently, the financial pressure that comes along with entrepreneurship can be quite high and may not only affect your business life, but may also adversely impact your private life since you may be in a pretty bad mood in times of financial distress.
Especially problematic for businesses with high investment costs
Entrepreneurship can also be quite dangerous for businesses with high investment costs.
Imagine you have to spend hundreds of thousands of dollars to start your business on machinery or other expensive equipment.
This can lead to serious financial pressure and you may also not have to much time to make things work until your capital will be gone.
Hence, you should be quite careful not to choose a niche where you have serious upfront investment costs for your business since in case it fails, you will often have to declare bankruptcy and have to suffer from all the negative consequences related to it.
You might even lose your home and end up homeless.
Your employees will mess things up
Everyone of us makes mistakes sooner or later.
However, since your employees will not be as motivated as you are, they will likely make more mistakes and mess things up.
In turn, you will often have to correct the mistakes of your employees and this can be quite annoying, especially in times where you have already pushed your boundaries and are close to burnout.
You have full responsibility
While some people like to have all the responsibility, others can’t deal with being responsible for all things that happen around them.
If you make mistakes as an entrepreneur, this can not only affect you.
It can also lead to a state where you have to fire your employees due to financial reasons.
Therefore, before starting your own business, make sure that you really like to take full responsibility for all things that might happen in your business.
Unlimited liability for mistakes in your business
You will not only be responsible for the things that happen in your company, you will often also be liable for any damage you or your employees cause for others.
For instance, if one of your employees makes a mistake and this mistake leads to a serious financial loss for another person or business, chances are that you will have to compensate the other party for the loss and if this loss is sufficiently high, you might even have to go out of business due to that.
You have to deal with difficult employees
If you own a company, you will also have to deal with rather difficult employees and this can be quite annoying, especially if they are hard to motivate or just lack the skills to do their job.
Some employees may also try to take away your authority and you should be prepared that managing people is not always fun.
You will have to rely on business partners
Being an entrepreneur often also requires to rely on business partners.
However, relying on business partners also implies a certain level of dependence and dependence is never a good thing in my opinion.
For instance, one of your business partners may betray you sooner or later and in case you are unlucky, you might have to bear the full damage yourself.
Thus, choose your business partners wisely if you plan to become an entrepreneur to avoid any unpleasant consequences.
Entrepreneurship can imply excessive stress
Another downside of being an entrepreneur is that it can simply be quite stressful.
You are not only responsible for yourself, you are also responsible for your employees.
Moreover, you will also have so many things to do every day and if you don’t learn how to organize yourself properly, entrepreneurship can even become your worst nightmare.
Only few people have the stomach for being an entrepreneur
In general, while many people think that they have the potential to be an entrepreneur, most of them don’t.
In fact, quite few people have the stomach to deal with all the problems that come along with entrepreneurship and if you don’t have a certain mindset, you will probably fail.
What nobody talks about is that most startups fail within the first two years and this is not surprising. Only very few people actually have the DNA and the patience to build a successful business.
You will have to work longer than in most corporate jobs
When you are an entrepreneur, you will also work longer than in most corporate jobs since you simply want to do the best you can to push your business forward.
While this may not be too problematic for you if you love what you are doing, it can still be problematic since you will not have too much time for your family.
You may go out of business
As mentioned earlier, entrepreneurship is really difficult and many startups will go out of business pretty soon.
You should keep this in mind if you currently consider quitting your job and becoming an entrepreneur.
May lead to family problems
In general, since entrepreneurship is quite stressful and also rather time-consuming, entrepreneurs often don’t have enough time to spend with their families.
In turn, the overall family life may suffer quite a lot and this may also lead to divorce sooner or later.
Hence, you should also figure out what’s most important to you in your life and whether starting a business is worth it for you to potentially lose your family or not.
You don’t have a guaranteed income as entrepreneur
Being an entrepreneur also implies that you will not have a fixed income.
Instead, you will just get the profits of your company in good times and have to bear the losses in bad times.
Consequently, in times of economic downturns and financial trouble, you may no longer be able to pay your bills if your lifestyle has become too fancy and you may even lose your home due to that.
Many people underestimate how difficult it really is
Since entrepreneurship has become cool, many youngsters think that it is easy to start a business and greatly underestimate what it really takes to be successful with your own business.
This is also the reason why so many people fail with entrepreneurship.
While they think it’s easy, starting and operating your own business is indeed quite difficult and many people simply don’t have the knowledge and the persistence to push through difficult times.
You will have no official vacation
Another problem with being an entrepreneur is that you will basically have no real vacation.
While you are always free to take some days off, you will often still be available for important calls since you fear losing clients if you just completely cut the cord.
Consequently, it is also quite hard to relax for entrepreneurs since they always have to think about their business.
Many people have difficulties to unplug
In general, many entrepreneurs also have difficulties with really unplugging from their business.
Many times, entrepreneurs stay awake at night since they have just too many things going on in their minds. In turn, this can lead to mental issues in the long run since our brain just needs some time to rest.
Responsibility for your employees
Many people also underestimate the pressure that comes along with being responsible for your employees when you have your own business.
Your employees will often go into debt to finance a house or college education for their children.
In turn, you know that mistakes you make could not only affect your business, but also the lives of your employees quite a lot in case you will no longer be able to pay their wages.
Entrepreneurship can be bad for your health
Many entrepreneurs are not able to deal with stress in a proper manner, which in turn can lead to serious health issues in the long run.
In fact, many entrepreneurs suffer from burnout or even depression during their careers, even though this is not publicly discussed in our mainstream media channels.
It takes a long time to build a serious business from scratch
Many people also underestimate how long it really takes to build a meaningful business.
You have to put in countless hours of work and you will not see any results at the beginning.
It takes plenty of effort and a high level of perseverance to become and to stay successful as an entrepreneur and not many people have those characteristics.
Entrepreneurship is risky
Entrepreneurship is also not suitable for risk-averse persons.
There are many decisions that could potentially ruin your business and you just need the courage to make those decisions to push your business to the next level.
However, this also implies significant risks and if you are not the type of person who wants to take risks, entrepreneurship will likely not be the way to go for you.
Many people are delusional regarding what it means to be an entrepreneur
Since being an entrepreneur has become cool over the past years, people often have a completely flawed picture of what it really looks like.
While people often only see the glamour, there are also many unpleasant things going on in the entrepreneurial world which most people know nothing about.
Plenty of administrative work
Being an entrepreneur also implies dealing with plenty of unpleasant administrative work.
This may include accounting stuff, legal issues or also dealing with difficult employees.
In general, entrepreneurship is not always fun and you also have to do some tasks you don’t like.
You may get sued
You can also get sued for any mistake you or your employees make.
This can be a huge emotional burden and you should therefore get proper insurance for those issues so that you are covered in case of emergency and have peace of mind.
Top 10 Entrepreneurship Pros & Cons – Summary List
|Entrepreneurship Pros||Entrepreneurship Cons|
|Entrepreneurship implies high level of freedom||Being an entrepreneur can be lonely|
|You are your own boss||Entrepreneurship is extremely difficult|
|Being an entrepreneur gives you flexibility||You have nobody to blame but yourself|
|You can act according to your values||Can lead to family issues|
|Higher level of motivation||Being an entrepreneur implies high workload|
|You can make more money||Liability for mistakes of your employees|
|Entrepreneurship is quite interesting||Entrepreneurship can lead to mental problems|
|You can learn a lot||Entrepreneurs have difficulties to relax|
|You can grow in character||Many startups fail|
|Entrepreneurship may improve your confidence||Pressure can be enormous|
Entrepreneurship vs. Working in a Job – Which one is better?
While I personally love being an entrepreneur, it is definitely not for everyone and I highly recommend you evaluate all the pros and cons of being an entrepreneur carefully to make the right decision for your individual circumstances.
About the author
My name is Andreas and my mission is to educate people of all ages about our environmental problems and how everyone can make a contribution to mitigate these issues.
As I went to university and got my Master’s degree in Economics, I did plenty of research in the field of Development Economics.
After finishing university, I traveled around the world. From this time on, I wanted to make a contribution to ensure a livable future for the next generations in every part of our beautiful planet.
Wanna make a contribution to save our environment? Share it!