Emerging Business vs. Small Business vs. Self-Employed
I have heard people refer to themselves as entrepreneurs but they work at someone else’s company. Others call themselves business owners but their operation (if you can call it that) has no infrastructure, no formalization. Some think they are self-employed, but they’ve never actually sold a product or service, so there’s no actual money to employ themselves.
Do any of these scenarios sound familiar to you? Do you fall into either of these categories?
I am going to simplify this process for you. And for many of you, give you an out. I know the mantra right now is “hustle” and entrepreneurship is romanticized. I have developed a rubric that I use to identify and categorize my clients and prospects so I can truly distinguish whether I am dealing with someone who is self-employed, an entrepreneur, or someone who wishes he or she was either of those two designations.
This first term is important because many people fall under the category of Emerging Business. You are an emerging business if the following are true:
- You have a great idea, but you have not yet learned to present it.
- The potential business has one owner
- Your endeavor has not yet generated any revenues
- There has been no formal corporate development, which includes steps like incorporating your business or entering into business agreements
- You still have your day job and you’re positioning your idea to be your side hustle until it can replace your main income source
Self-EmployedThe second category in my list is self-employed. Freelancers are self-employed. Being self-employed takes a certain mindset and a set of proficiencies. In some ways, being self-employed is very much like being employed by someone else. The primary difference is you are your own employer and your service offerings are usually limited to those things you can do yourself. You may be self-employed if the following are true:
- You are 100% billable in your business
- A sales meeting cannot take place without you
- YOU are the board of directors
- You save money by doing support services yourself (proposals, accounting, legal)
- If you take a day off, the business closes that day
Small BusinessRunning a small business is hard work. There’s no way around that. And most small business owners will tell you that the work doesn’t stop, particularly during the early years of the business. Here’s how to tell if you have a small business:
- Fifty percent of your time is billable to the business and the rest of your business is done by staff members who can operate your business in your absence
- You only have to show up to “close” the deal
- You have at least 3 board members
We are about to become more connected than most of us can even dream. The Internet isn’t going anywhere. In fact, it’s going to continue to evolve and as the months (I don’t think we can count technological advances in years anymore) march on and your pantry and fridge collaborate online to re-order your groceries whenever you run out of something, you will learn how essential it is that you and your business are also part of the Internet of Things.
EntrepreneurTwenty years ago, being an entrepreneur wasn’t popular. Today, it’s everything. Everyone things they’re an entrepreneur. Everyone is trying to position their side business selling vintage clothes on Amazon as entrepreneurship. I have a distinctly different definition of entrepreneurship. You are an entrepreneur if:
- You generate multiple streams of revenue from a variety of resources
- You don’t work in your business, you work on your business
- Your endeavors don’t require anything more of you than your oversight and leadership
- You create other entrepreneurs
If you ever thought about owning your own business, I hope you also considered the work that goes into launching and maintaining an enterprise. Often, nine-to-fivers will leave their jobs in corporate America to run their own business in hopes of uncapping their...