Employee vs entrepreneurial mindset: What’s the difference?

There are two types of individuals, the ones turning ideas into businesses and the ones whose ideas never see the sun light.

If you can’t beat them, join them, so they say. Dissecting the difference between the employee vs entrepreneurial mindset concept is the first step to understanding what’s holding you back.

Employees can become great entrepreneurs, but some might not be interested or can’t let go of their comfort zone, they are just fine playing by the rules. Entrepreneurs, on the other hand, are interest-driven creatures with iron willpower, they never stop pursuing goal after goal until they’re satisfied.

Are you the kind of person that blindly follows orders or questions everything?

You’re about to find out which class of mentality you fall into. Don’t be discouraged if the news is not in your favor though, you can change your life by taking action sooner than later.

What is an Employee Mindset?

employee vs entrepreneurial mindset

An employee mindset is the near-permanent state of comfort.

Individuals with such a mindset typically have well-established routines and will be scared to death by the word change or any routine deviations.

This particular way of thinking is usually tied to average income and very little to no career progression in a job.

People stuck in this state of mind tend to have common procedure patterns, they bare through the month doing the least possible for the next paycheck.

What’s the ultimate test to find out if a person has an employee mindset? Ask them the old question what would you do if you won the lottery?.

You’ll most likely hear one of these 3 outcomes:

  • The employee mindset answer: Buy a house for myself and every family member, a car, clothes, jewelry, and so forth.
  • The person who falls in between: Would spend a specific amount right off the bat and save away the remaining.
  • The entrepreneurial mindset answer: Pay off debt, invest in the stock market, start or grow a business, and establish a smart plan to double the prize.

Although none of these individuals are taking wrong approaches, their life will play out differently from one another based on employee vs entrepreneurial mindset differences.

People behind the entrepreneurial mindset answer are likely to have less debt and be financially wiser.

One last fact to notice about the employee mindset is that it’s submissive to psychological challenges, it picks satisfaction over discomfort in any instance.

What is an Entrepreneurial Mindset?

employee vs entrepreneurial mindset

An entrepreneurial mindset is the Swiss Army Knife way of thinking. It fits everywhere and adapts to any environment effortlessly.

Entrepreneurs are mostly humans that solve problems, they create companies based on public demand for solutions.

They’re sharp, focused, and when plans don’t work out, they become obsessed over the problem instead of giving up.

Like employee mindset individuals, entrepreneurs also have routines, but they mostly consist of taking time to learn how to put ideas into practice.

Have you ever wondered how good is to have freedom, be your own boss, and travel every single week? You’ve seen so many people do it, why aren’t you included in the list?

Perhaps you think you don’t have it in you, or maybe you don’t have a college degree?

Well, according to a survey made by Guidant Financial, 34% of small business owners only have a high school degree. You see, Entrepreneurs don’t think too much about what doesn’t work, they find solutions, remember?

This is where the entrepreneurial mindset shines, it thinks, wants, schematizes, and achieves. If there’s no easy way to attain a specific goal, e.g. financing for a project, nothing stops the selection of a less traditional path to make it work.

Entrepreneurs know that failure is not absolute until they’ve tried from every angle possible. They’re truly unstoppable go-getters.

5 Employee vs Entrepreneurial Mindset Differences

1- Employees see problems while entrepreneurs see opportunities

Problems are fuel for entrepreneurs. While employees seek help whenever problems appear, entrepreneurs dissect problems themselves, every solved problem becomes a new source of knowledge added to the backlog.

2- Employees see price tags while entrepreneurs see motivation

When facing expensiveness, employees immediately think they’ll never be able to afford the expensive item while entrepreneurs become inspired by price tags, they’re likely to jumpstart motivation-driven journeys.

3- Employees are single-tasking masters while entrepreneurs are jacks of all trades and masters of none

Entrepreneurs are constantly learning and finding new possibilities, they never seem to settle in one place doing one task. Employees are the opposite, they’re comfortable repeating the same activity for extended periods of time.

4- Employees live for the next paycheck while entrepreneurs have several income sources

Following the line of thought from the previous point, several income streams are the result of performing several tasks and testing what works and what doesn’t.

Since employees tend to have a narrower set of activities, their income is usually lower and comes from a single source.

5- Employees believe time equals money while entrepreneurs believe value equals money

Employees sell their time to generate income, and entrepreneurs invest their time in creating value, even when it doesn’t bring immediate results.

This different way of thinking often confuses employee mindset folks, labeling any kind of creative activity as not a real job.

People often label blogging this way because at first glance it seems easy.

Little do they know that blogging requires an army of technical skills, countless hours of researching, and unstoppable dedication to be done right.

Every job that seems to pay unfairly high salaries is worth a deeper look. Usually, public opinion is nothing but speculation on what lies behind the scenes.

Is it Better to be an Entrepreneur or an Employee?

Generally speaking, entrepreneurship is better and brings in more perks. However, it’s important to mention that being an entrepreneur is not everyone’s cup of tea despite the typically higher income.

5 Advantages of entrepreneurship

1- Freedom

Entrepreneurs manage to turn their passions into their lifestyle, and without the pressure of a job holding them back, they’re free to be the ones calling the shots.

2- Several income streams

The first successful business is just the start, it’s a blueprint for the following businesses. Entrepreneurs easily generate active and passive income sources.

3- Personalized work schedule

Entrepreneurs only work as much as they want or need to, some want to change the world and work 24/7, and some just want to make enough to live comfortably. The work schedule is only determined by the individually settled goals.

4- Feeling of accomplishment

It’s breathtaking when entrepreneurs watch their ideas come to life, something that was once a loose thought becoming a full business that supports families, it’s almost magic.

5- Be your own boss

This is entrepreneurship in its basic form, entrepreneurs don’t answer to a chain of command, they hold the wheel and dictate the rules.  

5 Disadvantages of entrepreneurship

1- Productivity comes first

Often entrepreneurs don’t get to enjoy any off days, they will neglect their family and friends to meet a deadline or achieve a certain goal.

2- No guaranteed income

Income is proportional to generated value, new entrepreneurs are likely to generate less income than a 9 to 5 job for the first few months following the start of a new project.

3- Leadership pitfalls

Entrepreneurs often have to dismiss workers who provide less than optimal results for the benefit of the company, some will do it quite easily, but most will have sleepless nights.

4- Emotional and physical stress

Everything comes down to results, their survivability depends on it. Entrepreneurs put everything they have on the table, work as many hours as needed and always worry about everything except their health.

5- High expectations

Everyone expects entrepreneurs to turn everything they touch into gold, when in excess, these expectations may be counterproductive.

5 Advantages of being an employee

1- Fixed salary

Employees know what to expect when it comes to payment, they can plan out their expenses according to their income which is always on point.

2- Paid time off policy (PTO)

There’s a designated pool of days for paid time off from work. These include vacations, sick days, and the need for personal time.

Although employees now have the right to use PTO at their discretion, it’s worth mentioning that not all of that time is paid. 

3- Retirement plan

401(k), a retirement account sponsored by an employer that may or may not match contributions, make sure to check out our 401(k) article if you need more information.

4- Insurance

Most employers will offer their employees some sort of health insurance, dental and life insurance are the norm. These may come at a company special discount or be paid in full.  

5- Connection with coworkers

Many people crave social connections, being an employee enables the possibility to be part of the team and be friends with coworkers, a connection not always shared by the company’s administrators.

5 Disadvantages of being an employee

1- Risk of being fired

Employees don’t control their work environment. Therefore, several factors could lead to impending employment termination, the common ones being:

  • Attendance issues
  • Incompetence
  • Breaking company rules
  • Discriminatory behavior

Another factor worth mentioning is aging, some jobs require physical or mental freshness, and these will become more demanding as the years pass by.

2- Making someone else rich

Only a tiny fraction of the company’s revenue is allocated to pay its employees, the administration takes the larger cut. If an employee wants to get rich, working for someone else won’t make it happen.

3- Repetitiveness

Few jobs offer the opportunity of a flexible schedule, the majority of employees will be stuck in a never-ending fixed schedule, doing the same tasks over and over again.

4- Unwanted job changes

Employers can switch the employee’s schedule, position, and tasks at any given moment. 

5- Low salary

Employees are paid according to their qualifications, the pathway to earning more is to get more qualified. The employee could be spending this time investing in himself instead of qualifying to favor someone else.

Employee vs entrepreneurial mindset: Which one to pick?

There is no black and white answer when it comes to the employee vs entrepreneurial mindset.

It’s all a matter of circumstances, personality, and personal taste.

Some people will be happy with a 9 to 5 job under someone else’s command, and some will stop at nothing to be their own boss.

Is an Entrepreneur Born or Made?

Entrepreneurs come in all shapes and sizes, they’re both born and made.

Although some individuals are born predisposed to become entrepreneurs, there’s no perfect DNA formula or way to accurately tell how their working life will turn out.

The likelihood of starting a business is influenced by genes, but at the same time, bad circumstances are the sweet spot for innovation, therefore, entrepreneurship can be the product of an unbearable situation.

Here are some entrepreneurs that came from the bottom:

1- Oprah Winfrey

Oprah Winfrey
Source: variety.com

She was born into poverty but became the richest African American of the 20th century with a current net worth of around 2.6 billion dollars, according to Business insider.

2- Jan Koum

Jan Koum
Source: cnbc.com

The co-founder of WhatsApp was also born into poverty in a village near Kyiv. He’s now the proud holder of an estimated 10 billion dollars after selling WhatsApp to Facebook.

3- Larry Ellison

Larry Ellison
Source: wallpapercave.com

He came from a working-class family and his adoptive father constantly told him he wasn’t good enough. When he grew up, not long after he and a few other co-founders started Oracle, they landed their first big customer, the CIA. Oracle is now one of the world’s biggest tech giants. Larry Ellison is now the sixth-richest person on the planet with a net worth of around 100 billion dollars.

How do you go from employee to entrepreneur mindset?

Depending on how your brain is wired, the mindset switch can happen instantly or gradually. However, being a full-blown entrepreneur requires enough time to learn, practice, and make mistakes, there are no shortcuts to the experience.

In order to switch your mindset from employee to entrepreneur, you must acquire these foundational psychological structures:

Unshakeable will to make it happen

Before you attempt to change your lifestyle, ask yourself what’s the reason for the commitment. This introspective act will determine if you have what it takes, entrepreneurs with a strong motive are less likely to give up halfway.


It’s important to acknowledge the truth, nobody cares about what you do besides your parents, and maybe your closest friends. Self-motivation is a must-have to become an entrepreneur, you should never count on anyone else but yourself.

If you can’t let go of approval-seeking behaviors or can’t manage to do anything without peers, you’ll have a hard time leaving the employee mindset behind.  

Forget about instant rewards and expect delayed results

You won’t have a paycheck to rely on anymore, you’ll be on your own. It’s up to you to work harder than you ever had now, in order to reap the benefits later.

As an employee, you’re working every day for a paycheck of a specific amount. As an entrepreneur, you’ll be working for yourself to grant your freedom, with unlimited potential income.

Learn to assemble ideas

You’ll have to be in a constant learning state, but not everything you learn will be practical. It’s crucial to distinguish what is just a piece of information from what is appliable in the real world.

Think less, act more

You’ll never find out what would’ve worked if you never try. Eliminate these words from your brain: would of, could of, should of. Replace them with immediate action every time a bright idea strikes you.

Set realistic goals

Get away from getting rich quick schemes, anything that promises to make you an overnight millionaire is a fraud. Small steps are the most reliable way to build wealth.

The Bottom Line

According to Guidant financial, what holds back aspiring entrepreneurs is not knowing where to start and trouble to obtain finance.

If you’re truly an entrepreneur at heart then you’ll undoubtedly find a way around financing troubles. Leaving the comfort zone might be frightening, but staying in it could be even worse.

There is no winning side when it comes to employee vs entrepreneurial mindset, both bring advantages and disadvantages. Each one suits a different class of people.

At the end of the day, these are just ways of thinking that can be tweaked with enough practice depending on how bad you’re willing to change.

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