Owner vs. Employee: What They Never Taught You In School

Credits to Start From Zero: Build Your Own Business and Experience True Freedom

Get a good paying job with benefits so you’ll be taken care of when you retire—and you’ll even get paid time off!

This is what we are taught in school. But what I am about to tell you is going to contradict everything you’ve been taught about earning an income, and hopefully put you on the best path for you and your family’s future.

I’d like to start off by saying there is nothing wrong with being an employee. Entrepreneurship is not recommended for everyone because it requires a lot of risk, sacrifice, and hard work. It is a lonely road where you will have a lot of ups and downs. Only the ones with true grit and perseverance will succeed as an entrepreneur.

Now that we got that out of the way, let’s look at the difference between an expert and an owner:

An expert learns skills which they can use to exchange their time for money. An owner, on the other hand, goes out and creates or buys assets that earn them money even while they sleep. The two think very differently and it can be difficult to transfer over to the other side.

Author of Start From Zero, Dane Maxwell went to a Boys and Girls Club one day to teach about wealth. He asked them the exact same series of questions that his mentor asked him years ago. He starts by asking the kids what they wanted to be when they grow up. They all shout “basketball player, rapper!” This is exactly what Dane had anticipated and explained to the kids about the power of being an owner vs an expert. T.V. teaches us to become experts.

Next Dane asked would you rather be Michael Jordan or the owner of the Chicago Bulls? “Jordan, Jordan, Jordan!!!” they all shout. Understandably, they all want the glory of being Michael Jordan.

Then Dane asks the kids “If you’re Jordan and you injured your leg, could you still play?”. “No” the kids reply. “And if you couldn’t play, would you still get paid?” The kids had to take a minute to process the situation. Dane could see the faces of the kids as they came to a realization. “Ok… now if you owned the Chicago Bulls and injured your leg, would you still get paid?” After a moment of silence, all the kids said “yes.. it doesn’t matter if you’re hurt or not. The team can still play.” Then Dane asks the kids again, “So if you could be the owner of the Chicago Bulls or Michael Jordan, who would you want to be?” “Owner, Owner, Owner!!!” The kids reply.

Mission accomplished.

Michael Jordan was an expert. He earned about $100 million over his entire NBA career for his expertise in basketball. This sum includes his NBA salary plus his Nike deals. The Chicago Bulls owner, on the other hand, made $55 million per season on average over the last five years.

To look at some more numbers, the average small business generates $100k in revenue per employee. For large companies, this number is $200k, and for Fortune 500 companies they generate $300k per employee (Bonus: oil companies generate over $2 million per employee!).

If you’re an employee making $35k to $50k a year, then the company probably earns 2-3 times what they pay you (in this case, they would earn $100k from your efforts). With that said, you could actually double your salary if you did the exact same work as an independent consultant.

We were never taught the value, safety, and wealth of ownership. You are uncomfortable with it because you went through 15 years of school teaching you how to be an employee. Even in the media, owners are in the background. You don’t see them on TV like experts.

We hear of employees making six figures, and even CEO salaries but ownership takes things a step further. In the United States, only three firms are the largest single shareholder in almost 90% of S&P 500 firms, including Apple, Microsoft, ExxonMobil, General Electric and Coca-Cola. And you don’t see those owners in the spotlight. Together, the three firms own almost $19 trillion in equity.

If you have a dream to be an expert at something, do that for yourself! I’m simply just sharing the potency of ownership.