Entrepreneur v. Employee: a Comparison

by / ⠀Blog / July 11, 2022
entrepreneur v employee people gesturing

You must have heard a lot of people commenting how challenging it is to become an entrepreneur from an employee. Indeed, a giant leap of faith is required to take even the first step. But what is it that prompts people to make this professional transition? What career prospect wins if you think about entrepreneur v employee?

The battle of entrepreneur v employee shows its effects on every aspect, including mindset, habits, and overall approach to work.

Many people think there’s a clear distinction between entrepreneur v employee. Employees follow, and entrepreneurs lead the way. But that’s not always the case. Sometimes, it’s not so simple to distinguish between the two types of people.

Entrepreneur v Employee: an Introduction

Before we begin the comparison of entrepreneur v employee, it’s crucial to understand what the two terms entail.

To put it in simple words, employment is when you work for a company to receive compensation. You are allotted a specific role in a company that requires you to fulfill particular responsibilities. You might have to participate in training programs to fit into your position. And you receive payment consistently, usually monthly, when you are an employee.

Entrepreneurship is when you start a business for profit. An entrepreneur has to make investments, control the entire operations and spearhead the services of the business. Entrepreneurs can delegate some tasks to others but mostly rely on their expertise to boost their business. The pay is not always consistent and depends mainly on their business structure.

Entrepreneur v Employee: the Similarities

It might appear that the line of entrepreneur v employee is always clearly defined and different. However, there are some similarities between the two positions too.

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Yes, there’s quite a difference in the payment plan of the two positions. But let’s not forget that both entrepreneurs and employees receive payment for their work. After all, a professional always looks to earn a living. So whether you are a freelancer or part of a company, you will always be paid for your services.

Professional Development

Whether you are an employee or an entrepreneur, you will always have specific goals in mind for your career. Employees look forward to securing high-ranking positions while entrepreneurs aspire to land more clients. People in both positions are always eyeing the next step.

Striking a Balance Between Work and Life

Both employees and entrepreneurs strive to maintain their work-life balance. Both endeavor to deliver high-quality work while simultaneously taking time out for leisure activities too. This is what enables them to feel satisfied.

Managing the Clients

Employees and entrepreneurs tend to focus on building meaningful relationships with their clients. This is because satisfied clients are a steady source of income for both. Hence, they strive to cater to their client’s requirements to their full potential.

Entrepreneur v Employee: the Key Differences

Of course, there’s a world of difference between being employed and running your own business. It would be pretty far stretched to assume that both entrepreneurs and employees will have similar career graphs. Here are the differences between the two.

Payment Structure

Employees receive compensation depending on their position. Their salary is fixed. And they can also receive occasional bonus income in the form of commission and overtime pay.

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On the other hand, the compensation for entrepreneurs largely depends on how much they charge for their services. The number of clients they land matters significantly too. Hence their income fluctuates.


Entrepreneurs work independently. Hence they can develop a work schedule suited to them. Employees don’t have this freedom and have to abide by the schedule provided by the employers. They might also have to work in shifts.

Job Security

Being an employee often makes one feel more secure professionally. They work on a particular schedule and earn a fixed income. There’s more stability.

An entrepreneur has to perform varied roles to run his business. Yes, entrepreneurs too can attain stability, but that only happens once their business is more established.

Independence and Decision Making

As an entrepreneur, you have to make all the decisions for your business. Whether it’s about your work schedule or expanding your horizons, you have the freedom to decide what should be your next step. You are not answerable to anyone else.

But employees have to think about their supervisors. How much power they get in decision-making depends on their position.


When you are an employee, you can expect some benefits alongside your salary like a retirement plan, signing bonus, and health insurance plan. That’s because the people are trying to entice you to become a part of their company.

As an entrepreneur, you won’t get such perks. More often than not, you will have to pay for your own health insurance since you aren’t a part of an organization.

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Traditional employees have fixed responsibilities. The tasks allotted to them depend on their job title. Entrepreneurs have to handle a great deal more as they are responsible for the smooth running of the entire business.

Entrepreneurs v Employee: the Final Verdict

One really can’t say which one would be better for your career. There’s no fixed answer. Not everyone can be an entrepreneur, and everyone isn’t cut out to be a traditional employee either. It essentially comes down to your comfort zone and goals. Both have their pros and cons. If you want to make a career transition, ensure that you know what you are signing up for.

About The Author


Tauseeq Magsi has been a writing geek for the past six years. He has written about Tech, Finance, Leadership, Business, and more. He loves helping others achieve their goals, and he hopes to continue helping people through his writing for many years to come. In addition to writing, Tauseeq Magsi loves to travel and learn new things.


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