Re: Why do we choose to work for ourselves?
 

As a guy who's recently returned to the corporate world after 12 years of being an entrepreneur, here's my take on working for ourselves.

I too enjoyed the freedom of choice and ability to charge whatever the market would bear for my consulting services - often making 50% and more profit on my efforts and working about 30 hours per week.

And, like Michael below, I leveraged my time and resources to a certain extent through outsourcing, thus making the work even more fun and productive.

And, as Gordon mentioned, I left my previous corporate job mainly because I didn't respect my boss at the time, and thought I could do a much better job on my own. I was right, but my ex-boss and I are friends to this day - better colleagues than senior/subordinate.

I went back to work for a startup company (hi tech but not dot.com:-)) as a marketing and sales director to refresh my knowledge of the Fortune 50 market and update my technical knowledge.

I intend to leverage both my salary and commissions toward another personal startup in the future, as the hi tech world is a constant merry-go-round of employees coming and going.

So, I figure I'll do the best job possible for the company, increase my knowledge, have as much fun as possible, and move on when the timing is right.

And, yes, I do chafe under the 8 to 6 mentality, useless meetings, power grabs, endless presentations, politics and other trappings of corporate life. However, if I can maintain a sense of balance and stay above the fray, I can contribute and control my destiny within the environment until the stock options kick in or the company folds:-)

So, in the words of Jackson Brown:

"I'm just a happy idiot, working for the legal tender . . ." and being entrepreneurial on the side:-)

Bob

Another form of leverage.... selling to the right customers....
 

Hi Michael,

Yes, I also believe in the power of leverage!

It's amazing.... some people who started out, started out as one-person or two-person companies. Ross Perot's Electronic Data Systems started out with himself being the only employee. Microsoft started out just being Bill Gates and Paul Allen.

EDS eventually grew to have thousands of employees, and Microsoft is now housed on a campus....

Here's another type of leverage I've noticed. Leveraging your time by selling in bulk to the right people....

When you read the history of the early computer industry (such as in the book "Accidental Empires" by Robert Cringely, a pretty entertaining read by the way!), you find out that IBM originally wanted to use an operating system called CP/M. This was the standard operating system back then.

CP/M was owned by Gary Kildall, who had founded Digital.

However, Kildall apparently didn't place much importance on meeting with IBM.... When the IBM representative arrived, Kildall wasn't there. As a result, IBM didn't do a deal with Kildall. Instead, they did a deal with Bill Gates.

Gates bought some operating system called Q-DOS for $50,000 -- a kind of "clone" of CP/M -- promptly renamed it MS-DOS, and licensed it to IBM.

Kildall became known as the guy who blew the deal of the century, and Gates was the one who made it. (With a clone, I might add.... since CP/M was the original, and MS-DOS was in reality a kind of CP/M clone.)

But, the point is that by having IBM as a customer, Gates could eventually sell millions of copies of his operating system software.... Gates went to a lot of effort to land the right customer....

Online, I've noticed Jimmy Krug uses a version of this strategy with his booklets. He creates and sells booklets to corporate clients.

That way, he doesn't sell them one by one, but sells his booklets thousands at a time.

These are potentially powerful concepts.... :)

- Dien

Re: Why do we choose to work for ourselves?
 

Hi Bob,

Thanks for sharing your experiences.... I learn something from practically everything you write.... :) You really seem to have everything together! :)

It really must be a change, after 12 years on your own, spending a bit of time as an "employee" once more....

It'll be interesting to see how things develop with the new startup you're with! I think if I were to work somewhere as an employee, my first choice would probably be with a startup.... as I think everything would be quite exciting. :)

Cheers,

Dien

"PRACTICALLY everything . . ." !!?! I better sharpen up, Dien:-) DNO (DNO)
 

Possibilities
 

You don't make billions solely as an employee.

And as long as you're setting goals, might as well set them high.

For me, I can't say there is one single factor that motivates me to work for myself, but rather there is a range of factors.

Firstly, I find working for myself much more challenging and interesting. Rather than doing a small number of tasks for an organisation and being assigned roles, I have responsibility over an organisation I can build from the ground-up, covering all the different areas and being very much a generalist, with each day bringing new challenges and obstacles to overcome.

As Michael Ross has said, it allows for greater leverage, which I love. I personally feel one of the keys to wealth is what I call Labour Market Arbitrage (LMA), where you buy labour inputs and sell their production for a higher price, or in other words... You pay someone a salary of $30/hour for something that you can sell for $35/hour.

Being an employee doesn't allow you to do this.

Speaking of leverage, you also do this with your capital/money inputs -- you try to borrow at 12% to earn a rate of return of 20%. That's the name of the game.

Business is just organising your labour and capital in such ways to produce different outputs at a profit, with competition and marketing and other business factors effecting that output.

I love this game. :) And I can't play it as an employee.

- Thomas.

> Hi Ricky,

> Sorry about that.... Here's the question
> again.....

> There are many reasons why people choose to
> work for themselves.... It'd be exciting to
> know some of the reasons....

> What are some of the reasons that people
> choose to work for themselves?

> Thanks! :)

> - Dien

Re: Possibilities
 

Well said. For me, I think an important factor in working for myself, besides the points Thomas has
already mentioned, is the freedom and flexibility it brings. Not only is the potential profit range much larger, but how you go about attaining that profit is solely up to your creativity and knowledge.

There's no drudging day to day in the hours that somebody else has set for you. There's no being restricted to a set wage, and having to take a second job or beg for a promotion or payrise to increase your income. You're in charge, and your motivation to work is the potential you can achieve, not just so you can keep your job.

I don't think you feel as threatened working for yourself as you do for an employer, either. You don't have to worry so much about impressing your superiors, office politics, or strict punctuality. Without the meaningless stresses that being employed can often bring, you're left with more time and energy to focus on expanding your own profits and production. If you don't feel able to work on a given day, you can choose not to, at the expense of the profits that day's work would bring. But you don't have to worry about being fired to taking too much time off. You don't feel *obliged* to work constantly, and it's human nature that we work harder and more efficiently when we're working for something we believe in, not just working to achieve somebody else's goals.

Working for yourself means being rewarded for your success. If you put twice the effort in, be it in the form of twice the labor hours, twice the capital or twice the creative energy, you can often expect to reap twice the rewards. If you're employed by somebody else, working twice as hard might only gain you some overtime pay - if your effort is in the form of extra working hours - and often not even that, depending on your industry.

Today's working world provides very little incentive for the nine to five "drudge worker". Their only incentive to put any effort in at all is so that they can keep their job to meet their expenses. Working for yourself is vastly more rewarding, with direct benefits for the time and energy you put into your company.

When I was employed full time, I greeted every day with anger and dread. "Another damn day in that hellhole," I'd think to myself each morning I dragged myself out of bed.

Today, I don't have that pressure. I start each day thinking to myself "What can I do to improve my company and increase my profits today?" and I feel motivated and inspired to work towards that goal.

And ultimately, it's because of that - the peace of mind and freedom that comes from working for oneself - that I know that even if I'm having a bad month and money's tight, I'll *never* go back to full-time employment. I'll just work a little harder.

- Shannon L.


Fifth Dimension Computing

Playing the game of business, and enjoying what you do!
 

Hi Thomas,

I really loved your post! :)

> I love this game. :) And I can't play it as
> an employee.

Thomas, I think that's the right approach! :)

You reminded me of this.... Bill Heinecke is a very successful American entrepreneur who's based in Thailand. He owns many first class hotels there, as well as restaurant chains (he owns the Pizza Hut, Swensen's ice cream, Dairy Queen, and Sizzler restaurant chains in Thailand), and is the exclusive distributor for Piper Aircraft in Thailand.... and a few other businesses there in addition to that!

Here's what Bill Heinecke has to say....

If you don't enjoy your work, you won't invest the time and energy needed to make it a success. I don't know of any successful entrepreneurs who consider their work boring. For most, it's a stimulating and challenging game. It has to be, because many entrepreneurs also spend most of their evenings and weekends working.

Never work just for money or power - it won't satisfy your soul, please your family, or help you sleep at night. Believe in and be committed to your business more than anyone else. In the early days, I was able to overcome most of my shortcomings through the sheer passion and enthusiasm I brought to my work. It's far easier to do this when you enjoy what you are doing.

[...]

I didn't mind working crazy hours, because it was fun. I constantly ask myself, "Do I really want to be doing this? Is it enjoyable?" If the answer is "no," I re-examine the business.

[From William E. Heinecke with Jonathan Marsh, "The Entrepreneur: 21 Golden Rules for the Global Business Manager," p. 39-40.]

Thomas.... you really reminded me of this. Playing is the best approach! I first learned this in physics.... I did my best physics work when I was just playing at what I was doing, having fun.... My playing around with physics got me the prize for the best Ph.D. thesis in the Science Faculty....

Richard Feynman, a Nobel Prize-winning physicist, says the same sort of thing.... He got his Nobel Prize for work he did while he was just playing with physics.... (He explains this in his book, "Surely You're Joking Mr. Feynman".... see especially pages 173-174.)

Thanks Thomas.... You reminded me of something very important that I had forgotten!

- Dien

Re: Why do we choose to work for ourselves?
 

> What are some of the reasons that people choose to work for themselves?
For me, the decision to leave the public service rut was easy.
The Doctor said,"stay there and you will be dead in 5 years".
That was 6 fairly tough years ago and I never regretted walking out the door. SOme of my ex-colleagues are still there counting the days until they can retire.
The funniest thing is one of my bosses accused me of disloyalty but left when he managed to get a very rare redundancy!


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