If you’re building a freelance business does that automatically make you an entrepreneur? Maybe, maybe not. Entrepreneurs and freelancers may have plenty in common but there are also some key differences between the two.
Where they’re similar
Freelancers and entrepreneurs are both considered self-employed. They both create their own jobs and fill a need.
They both have to be multi skilled. A freelancer has to wear many hats in their business as they’re the only ones responsible for the success of it. This means they have to balance their duties between client work, admin, and managing finances. While many freelancers will outsource some of their responsibilities, they usually start out working alone.
An entrepreneur has to be full of ideas, practical, good at managing people and creating a sustainable way of making money that can still adapt to changes in the market.
Where they differ:
A freelancer simply exchanges their services for money and their daily tasks surround keeping that sustainable. A successful entrepreneur will be able to build a business that functions separately from them. Entrepreneurs essentially can make money while asleep, whereas a freelancer’s most valuable asset (aside from knowledge) is the time they can bill for.
How they make money
A freelancer will exchange their own knowledge and experience for money. On the other hand an entrepreneur will gather people with the right knowledge to collectively make money.
This means that a freelancer’s business is only as big as they can stretch themselves. An entrepreneur’s business has less of a limit and will therefore find it easier to expand on a larger scale.
While freelancers and entrepreneurs may share skills, there are some that are more important than others for both sides.
An entrepreneur’s key to success is managing their team. They will need to be able to delegate and manage large groups of people so that the business runs smoothly. They will have more of a bird’s eye view of how the business is run.
A freelancer’s most important skill may be organisation because without it their business would struggle to function. A freelancer needs to be good at managing their own time because time is literally money.
Comparing long-term goals is a good way to tell the difference between entrepreneurs and freelancers.
End goals will be different for everyone but an entrepreneur aims for a company that is full of workers making a profit together. With this, there is room for expansion. This could then mean eventually expanding to have more offices, staff and a wider line of products or services on offer. The business should be able to run efficiently and without constant input from the entrepreneur who creates it in the first place.
A freelancer’s goal is more likely to be setting themselves up as an expert in their niche, enough so that they can charge top rates. Once they are able to do this, they are more likely to outsource tedious, time-consuming tasks to others, leaving them free for client work that actually makes the money. A successful freelancer will have fostered solid relationships with others in their industry and clients in order to make a name for themselves so that they don’t struggle to find work in the future.
Do you consider yourself a freelancer or an entrepreneur? Let us know your thoughts on the differences and similarities in the comments.