Difference Between Entrepreneurs And The Self-Employed

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Often seen as one in the same, an entrepreneur and a person who is self-employed may share the similarity of owning a business, but beyond that they begin to stray down vastly different paths.

Defined below, we can see where these two roles intertwine as business owners. But when taking a deeper look we see the major difference being that the self-employed are the business, where as an entrepreneur operates a business.

Self-Employed – Working for oneself as a freelancer or the owner of a business rather than for an employer.

Entrepreneur – A person who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so.

Typically the majority of business owners fall under the category of “self-employed”. They begin with a skill or particular set of skills and find that the opportunity to make money arises. This is where the crash course in business begins. From insurance and licenses to accounting and marketing soon many owners are smothered in the infinite amount of hours required to keep the business alive.

While many individuals are still the “owners” of the business, they typically carry all the responsibilities of an employee. This combination of duties can create many limitations on the success of the business. Essentially working anywhere from 2-10 jobs often the self-employed are overworked, underpaid and lucky to get a few days off a year.

On the other hand an entrepreneur is all about risk and reward. They think outside the box for the best ways to succeed and move on to their next venture. While the businesses might be of interest it is really the passion of the start-up and leading something to success that drives them everyday. Often this can lead to selling the business or moving on to start a new one once they have everything set for the future.

Other key differences between self employed person and entrepreneur

An individual working for oneself as a freelancer for a certain skill is a self-employed person.

An individual who organizes and operates a business or businesses, while employing specialists to run each wing of the business and managing the overall business is an entrepreneur.

Self-employed people work perpetually irrespective of the contractors or employees they have hired. Whereas for an entrepreneur, the business is on auto-pilot mode, and they have the remote control to manage the business. Therefore, the business can run even if the entrepreneur is physically absent for a while as they have a complete business overview.

For a self-employed person, if the owner retires or dies then the company will cease to exist. For an entrepreneurship venture, the business will continue to operate even if the owner retires or dies because the other employees are working with the founder and not for the founder. Therefore, they understand the mission, vision, and values of the business. For example, Apple Inc. continues to operate even after Steve Job’s demise.

Entrepreneurs are global thinkers and strategize and forecast for the long-term business goals and expansion. They forecast their business on large-scale. Whereas a self-employed person has a smaller audience and focuses on short term goals and seldom strategies to reach a large audience.

A self-employed person is usually averse to taking risks whereas entrepreneurs take, manage, and control risks.

A self-employed person handles most of the responsibilities and outsources a task or two whereas an entrepreneur delegates most tasks and has time to strategize and plan for long term.

Self-employed people receive payments directly from their clients whereas entrepreneurs are compensated by taking a share of the profit from the business. Business profit is derived from revenue obtained from numerous customers or clients.

Self-employment carries far fewer requirements and restrictions than entrepreneurship when it is time to file their personal income taxes. Entrepreneurs deal with a wide range of legal requirements including business registration and licenses, obtaining permits, meeting legal insurance requirements, and filing business taxes.

With many qualities overlapping, where do you see yourself categorized below?




-Hard Working
-Goal Oriented
-Quality Conscious
-Good Communicator



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