Why You Have to be a Business Owner to be Free

“Go to school, get a good education, get a good job and you will be successful.” How many people have been told that? How many of you still believe it? How many people do you know who followed that path and are nowhere near where they wanted to be? More than a few, I am sure.

Whether you are an employee or a professional employee, you are still working for someone else. You are owned by the job and to the extent you are in debt, you are owned by the bank. I think I can make a pretty good argument that employees are not free people. The only difference between employees and slaves is that the employee has the better choice of quitting rather than dying.

If this seems a bit extreme, think about it. Your job is what determines your life. It determines the car you can afford, the house you live in, the clothes you wear and the quality of the food you eat. Sure, you can make choices all day long but the boundaries of your choices are determined by your paycheck; your paycheck is determined by your boss or the company. Let’s say someone gave you a 10,000 square foot house. You could not afford to heat and cool it unless you had a huge paycheck. If someone gave you a Countach, you could not afford to change the brakes or maintain it unless you had a huge paycheck. Your employee paycheck determines not only what you can afford to buy, but what you can afford to own.

If you want to be free, you have to have an income with no upper limits placed on it by others. The first thing most folks think about is someone who owns a successful business.

A business is a headache, is it not? You never get to relax, you are always getting calls about problems, your time is never your own…these are some of the complaints you hear from folks who are business owners, yes?

Wrong. These are the complaints you hear from the self-employed, folks who own their own job, not folks who own their own business. In the Cash Flow Quadrant by Robert Kiyosaki he lays out the four corners of income generation. Most likely you are living in the Employee quadrant as is a high 90 percentile of the population.

Then you have the professionals who work as a partner in a practice. They get a share of the profits, but to call them a business owner would be simply wrong because they can be fired. The folks generally work for years, putting in the effort and catching the late night shifts hoping to prove to the current partners that they are partner material. They often never present that proof despite years of effort and many hundreds of thousands, if not millions, of dollars in profits for the partners.

Close, but still no cigar, is the Self-Employed person. These are the fellows and ladies who believe they are a business owner. I argue that of these folks who complain that the business owns them rather than they owning the business have hit the nail square on the head with precisely enough force to sink it. They are responsible for everything. They make all the decisions, often perform the lion’s share of the work and have to go get the business in order to perform the service. They then have to do the billing in order to get paid. They are idea man, salesman, serviceman, and book keeper. Instead of one job, they have eight, or maybe ten jobs. It sounds positively exhausting to me.

A business owner invests his money into conceiving, building and running a business and eventually training a trusted employee to run the business so he can go build another business. The business is self-sustaining on a daily basis with no help from the business owner. A self-employed person owns a restaurant where he has to go work from 4AM until midnight because he works for himself and he does everything. A restaurateur owns a restaurant and has people he trusts to run it while it generates an income for him. He may or may not show up to work in the restaurant as it pleases his fancy. He pays someone to manage the restaurant while he goes out and creates more restaurants and therefore more profit centers. He can also choose to sit at the house if he or she likes because the business is self-sustaining and managed.

At some point, the successful business owner chooses to either remain involved in just the businesses he has built or he moves from being just a business owner, or an owner of multiple businesses, to an investor.

Generally, moving through the strata of employee, self-employed, business owner, and investor takes years and sadly more capital than most folks can accumulate in a lifetime. A McDonald’s franchise as I have mentioned before is the closest thing to a sure fire investment out there according to more than a few folks. What is the minimum investment to start? $250,000USD and it has to be your money, not borrowed money.

It is for this reason that Warren Buffet, Donald Trump, Richard Branson, and Robert Kiyosaki are excited about and endorse the network marketing model. It allows you with very little capital to be engaged in a business with back office support, distribution channels, a proven product, a successful business model and by its nature it enables you to build multiple profit centers using a modification of the franchise model.

An employee is at the mercy of his employer for lifestyle changes. A self-employed person can to some degree try to work harder or smarter, or both, in order to effect a lifestyle change. A business owner is free to go out and start a new business to pay for lifestyle changes or for whatever it is he wishes to acquire or bring about. So, too, is an investor. The employee and self employed person are both limited by the amount of time they have in one day.

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