Learn about the advantages and disadvantages of being an entrepreneur and creating and setting up a company. Evaluate the opportunities and risks involved in entrepreneurship and reflect on the possibilities of growing and consolidating yourself as a freelance professional, or corporate entrepreneur in the current economic environment.
Setting up a business revolutionizes the personal life of an entrepreneur, due to the responsibilities that running a business project requires. The most immediate impact is a reduction in their free time, but they also see an increase in their personal satisfaction.
Launching an entrepreneurial venture is not an easy task, as it has a considerable impact on one’s personal life. Having a personal business depends on the motivations that lead us to believe in our business opportunity, on our attitudes and aptitudes, and on how the market we are targeting is. In addition, there is a great impact on our leisure time, self-confidence, and personal satisfaction.
What facets do entrepreneurs have to sacrifice in order to pursue their careers? The aspects of the entrepreneur’s life that are most influenced by entrepreneurship, according to the interviewees, are free time, self-confidence, and personal satisfaction. Evidently, the effect on the first of these elements is negative, while the effect on the other two is positive. MIT Technology Review delved into the changes that occur in the personal life of the entrepreneur through interviews.
Table of Contents
- Considerations before starting a company
- Advantages of Entrepreneurship
- Disadvantages of Entrepreneurship
Considerations before starting a company
It is the eternal question that every entrepreneur asks himself: is it really feasible to start my own company? And, evidently, the answer is not simple. There are as many factors involved as there are types of business and people willing to take charge of them.
From the motivations that lead us to undertake to the existence of a real business opportunity, through the attitudes and aptitudes of each entrepreneur, the decision to undertake or not is subject to a series of considerations that must be taken into account before launching into the adventure of entrepreneurship.
Because creating and consolidating a company is a complicated process in which both personal and professional factors come into play.
On the one hand, it is not enough to have a business idea. For it to materialize into a real business opportunity that makes the sustainability of a company possible over time, it is necessary to know the conditions of the market in which we operate, what our competition is, and who our customers are. And, of course, to assess whether they are willing to buy our product or service. In addition, it is vital to have the necessary elements and resources to start up a business, and these range from the availability of capital or financing to the project’s human team.
On the other hand, successful entrepreneurship requires certain skills and knowledge of business management, sales, and marketing, as well as a determined attitude when facing challenges and risks, organizational and negotiation skills, and a previous assessment of how the performance of this professional activity influences our personal life.
So if one day you find yourself asking yourself: “I don’t know what to do with my professional life, should I start a business?“, take some time to reflect on your goals, your strengths, and the lifestyle you want.
And very importantly, thoroughly evaluate the advantages and disadvantages of entrepreneurship and your expectations about it.
Advantages of Entrepreneurship
In the labor context in which we are immersed, working in a company for life, at least as an employee, is a concept that is becoming blurred in favor of greater labor mobility, but also of greater uncertainty. The generation of self-employment is not exempt from this uncertainty about the future, but the continuity or not of the activity depends on economic and business factors and not on the decision of our employer.
As entrepreneurs, we are the ones who set the pace, the working hours and impose the rules that will govern our activity. Although it is true that, as we will explain later, it requires great dedication and effort, being our own boss allows us to decide autonomously when is the best time to perform a certain task or what is the level of demand to be applied.
It goes without saying that these types of decisions must always be made within the principles of responsibility, perseverance, and the search for excellence and quality if we want our business to be successful. But it also allows us to implement our own ideas and work methodologies, adapt the activity to our needs and decide to what extent we want to reconcile our work and family life.
If we choose to start a business together with other partners, we will sacrifice part of our autonomy for greater capacity. If this is our decision, we must be aware of the risks involved and be careful not to make the typical mistakes when looking for a partner.
In the case of free time, 72% of those interviewed considered that entrepreneurship has had a negative impact, in the sense that it has significantly reduced the time they have available outside their professional activity. The workload is higher than in previous occupations and the entrepreneur says that he or she has less time to spend with friends and family.
In many cases, entrepreneurs say that in previous jobs, for example, in large multinationals, they also had a workload that demanded a great deal of dedication. In the case of entrepreneurship, it is the weight of responsibility for the progress of the project that makes this pace more difficult to bear. However, it is also this added effort imposed by the responsibility that results in greater personal satisfaction.
Entrepreneur Talal Benjelloun, the co-founder of Glamping Hub, says his life has changed significantly on a personal level following the creation of his company. “It’s not easy to sacrifice free time, you become the anti-social person who does nothing but works on the project and you end up leaving aside your leisure time and weekends,” he explains. Or as Tom Horsey put it: “Entrepreneurship is a 24-hour-a-day, 365-day-a-year job.
However, there are entrepreneurs who, as an exception, do not consider that entrepreneurship has had a negative impact on their free time. This is the case of Stefan Götz, founder of Biobam Bioinformatics, who said that as a researcher he already worked as much as he could, so he did not notice a significant change after starting his project.
90% of the entrepreneurs interviewed stated that entrepreneurship has positively affected their self-confidence. Successfully facing a series of challenges gives the entrepreneur the conviction in his or her own abilities. In addition, the external recognition that many entrepreneurs receive generates positive reinforcement in the way entrepreneurs see themselves through others.
Nothing produces more satisfaction than a job well done, especially if it is developed, from its gestation to its execution, under our own perception of how it should be done.
Satisfaction refers to the feeling of happiness that entrepreneurial activity generates. “You don’t stop thinking about work 24 hours a day, but every achievement you make is like seeing a child walk for the first time, it brings enormous satisfaction,” said one entrepreneur.
This type of satisfaction is related to our value as individuals through the approach and overcoming of various challenges, applying our skills productively and imaginatively, and obtaining results as a result of our effort, our dedication, and our passion.
Higher-income and economic freedom
Perhaps this is one of the most controversial points, but, if our project is well planned and is finally successful, we can aspire to have a higher income than working as an employee.
Although it is true that, sometimes, in the initial stages of a company, expenses are higher than income, so it is advisable to have a surplus and an economic plan in which we have calculated for how long we can “afford” to lose money before starting to make profits, once we reach this point, the chances of increasing our economic perception also increase and, moreover, this will be related to the economic success of our business project.
Fighting for your own project
Very much in line with the above, entrepreneurship means setting a project in motion, especially when it involves difficulty. Entrepreneurship is a daily struggle to overcome challenges and obstacles, but this battle becomes much more bearable when it is aimed at achieving the goals we have set for ourselves.
But it is not only our aspirations that are at stake but also the time and money we have invested in our project, the sacrifices we have made to get it off the ground, and the possibility of passing on the fruits of our efforts to future generations.
Starting and consolidating a company that, with its activity, is able to meet real needs and demands and contribute to the improvement of the environment in which we live can be a great source of social recognition that, although it should not be the ultimate goal, can open many doors to continue growing and evolving both professionally and personally.
The rise of freelance teleworking today allows many professions to be exercised remotely, from anywhere, which opens the door to work from wherever you want at any time. Whether it is your second home, your hometown where you can enjoy a better quality of life, another country where you move for a while, or even, who knows, around the world.
Freedom of purpose
If you dedicate yourself to what you really like and you are really helping other people, your entrepreneurship will reach an additional point of satisfaction and fulfillment, giving much meaning to your life.
Disadvantages of Entrepreneurship
When we start our own business, we must know from the beginning that it will require many hours of effort and dedication, especially at the beginning. Entrepreneurship means, in many cases, developing many skills and being able to put them all into practice at the same time, that is, being a “multitasker”, as well as developing good business productivity habits.
Being in charge of a business does not only mean making cash at the end of the month but the control and supervision of all the activities and decisions that are taken must be constant. In fact, when it comes to microenterprises, it is usually only one person who is in charge of developing several activities necessary for the normal operation of the project, so the dedication is even greater.
However, as we have explained above, we have greater autonomy to decide the when and how of each task.
There are many factors that determine the economic success or failure of our business project, both external, such as an unfavorable environment, and internal, which may result from poor management.
As entrepreneurs, we are responsible for the economic viability of our project and, in particular, the self-employed and small companies, since in these cases the capital usually comes from our own funds or from other sources of financing, but we are responsible for the debt.
In addition, the economic success or failure of the project depends on the profits or income we receive and, therefore, our livelihood. Also, it is necessary to bear in mind that the income can vary notably from one month to another, a reason why careful economic planning is advisable.
In relation to the above, the uncertainty regarding the growth and consolidation of our business project is constant for the entrepreneur. As entrepreneurs or self-employed professionals, we are ultimately responsible for every decision, every success, and every failure.
There is no formula that guarantees the success of our project and there is always the possibility of an unexpected turn of events, so it is vital to have a backup plan in case everything fails.
Finally, it should be noted that mentoring programs for entrepreneurs help to achieve results more quickly, reducing risks and uncertainty by avoiding making the mistakes that others have already made.
They also allow you to take advantage of the experience and knowledge of the mentors, so it is an option that you should consider.