04. The Goal of Entrepreneurship
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What is your objective in starting your own business? Many people will state the goal that they will want to earn more. That will certainly happen if you do your business well. But at least initially, when you start a business, you will not only be taking on risks, but most likely your income might actually decline.
What you really want to do is to build financial security. How do you do that? The main reason entrepreneurs or businessmen can potentially earn more than professionals is because they have also what you would call passive income.
How do you distinguish that? Active income is the amount you earn based on your skills and time. Passive income is the amount you earn from your investments and assets — income that hopefully will continue even if you are no longer actively working, - or even when you’re sleeping. That is why being able to build up your passive income becomes so powerful!
Financial Security is accomplished because you know you don’t have to keep working in order to keep the revenue coming. Of course, as professionals, you can also accomplish financial security by investing wisely, but entrepreneurs, owning their own business, will have more control and opportunities to accomplish that.
At the end, you should always remember your goal of financial independence — that you should try to save enough, or invest properly, so that you will have an income that will sustain the lifestyle you want even if you have to stop working.
And if that is the reason you engage in Entrepreneurship, thus, you must not lose sight in getting every opportunity in building up your investment income, and your money-earning assets!
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October 20th, 2005 at 10:17 am
[...] Earlier, I wrote an article about what is really the goal of entrepreneurship, and why it is the holy grail to financial independence. [...]
November 7th, 2005 at 7:36 am
Earning from OPM
November 30th, 2005 at 7:29 am
[...] Isn’t that true in business? Sometimes, the most important thing is to understand your objectives, and what your business model is. Know the direction you want to drive to is still the fastest way to arrive! [...]
January 27th, 2006 at 2:41 pm
[...] In some other industries, however, notably in technology, the emphasis is not to automatically do things, or let established business process hamper the employee. Both schools I guess have arguments going for and against, and at the end, you as a manager is the ultimate judge on what works for you. Two anecdotes here highlights what happens when people start to let processes take over, and do things without thinking. [...]