Working with entrepreneurs, we run into this challenge repeatedly. 

You start a business, and you work hard at delivering on that business. You reach out to new clients and create work for yourself that you execute, often very well. 

However, delivering becomes a chore. It ends up being a lot of work, and the more you want to earn, the more you want to grow, the more work falls on your shoulders.

 

There seems to be a direct relationship between how hard you work and how much you earn. 

There are only so many hours in a day and days in a year, so your potential is limited. And you end up trapped, working ever harder to eke out a living.

You become a slave to the business. 

You should be running a business that delivers results, money, income, and freedom to YOU, not making you a slave to it. 

 

The first step to doing this is creating a mindset shift. 

What is mindset

Mindset is how you view the world and approach your business. 

Think of mindset as a lens you look through. If you look through a red lens, the world you see looks red. If you look through a blue lens, the world looks blue. 

Similarly, your mindset tints the world around you and frames how you see, address, and tackle the problems around you. 

Our mindset tool, based on Robert Kiyosaki's Cash Flow Quadrant, presented in his book "Rich Dad, Poor Dad." He applies it to thinking about your life and finances; we apply it to your life as an entrepreneur. 

The Four Quadrants

• Employee
• Self-Employed
• Business Owner
• Investor

The Employee Mindset

Almost everyone begins to approach business with an employee mindset. Our first introduction to business is getting a job, so we learn to be an employee. 

As an employee, your boss sets the agenda. They are ultimately accountable, and you deliver according to their needs or the plan that they put forth. 

Growth in any organization means taking increasing levels of responsibility, but always within the employee mindset. Managers in an organization still approach their work with an employee mindset. They set the agenda for those working for them but do so within the constraints imposed by their boss. 

Often even the executive leadership of a company views their role from an employee mindset. This mindset constraint is why reinvention, innovation, and meeting future challenges are tricky for executives. 

They are not looking forward and inventing; they let the company set the parameters. 

Example: Imagine that you fix computers for a living. 

If you are an employee, you show up at work, receive your instructions, grab the parts, and do your job. If a piece is missing, you call somebody else, and you might delay until the next day. Your role is one of a technician.  

The self-employed mindset

When a person leaves a corporation or that first job to launch their own business, they tend to adopt a self-employed mindset. 

When you look at the world with a self-employed mindset, you take on the agenda-setting work, but continue to be responsible for execution. 

Often clients take the role of the "boss," and you end up bouncing from project to project. You are often either swamped with way too much to do or panicked because you don't have enough to do. 

Your time horizon expands to maybe a year rather than weeks or months, but you are still very much focused on the work and delivering projects for somebody else.

Self-employment can be very limiting because there are only so many hours in the day. So if you approach your business with a self-employed mindset, you quickly run out of capacity and have no way to scale your business. 

Example: You still fix computers

But not... You do this as an independent contractor. Now you have to schedule, plan, ensure that all parts are in place, and fix or install the computer. 

 

The big shift: Think like a business owner.

The change from "self-employed" to "business owner" is the critical mindset shift. 

When you look at your business as a business owner, you solve business owner problems. You think about the future, plan for what is coming next, and set the agenda. 

Instead of doing the work, you coordinate with others to do the job. You are responsible for the performance of the company. However, instead of doing the work yourself, you manage the system that executes. 

Example: People fix computers for you

As a business owner fixing computers (and technology in general), you are worried about all aspects of the business, not just making sure computers work. 

You don't do all of the work. Instead, you manage others to do the job. You have a team of technicians, and your focus is on managing them and managing the system that ensures you will continue to have many computers to fix and install. 

 

The final stage: Investor

An investor looks at a business as a money multiplying machine. You put money in, and you get money out. You can put money into a variety of machines to get a high return. 

Investors hire people to run their businesses and deliver the returns. They think of the future and other investment opportunities. They are always looking for a new way to invest and make money. 

The key here is the allocation of capital, and the investor should always be asking if the distribution is right and the investment pays off well enough. 

Example: You think about maybe moving out of computers

When it comes to fixes computers, the investor thinks about whether or not fixing computers is the right thing to be working on. Are the computers you are fixing getting outdated by today's standards? Should you perhaps consider offering new computers or branching out into something else? 

Alternatively, there are complementary products that go well with the computers you should be investing in or offering. 

 

What mindset do you need? 

The key to mindset is first to understand the concept, then start analyzing how to shift it to look at problems through different mindsets. 

As an entrepreneur, you must be able to understand all mindsets. It would be best if you worked on building the flexibility to see things through one mindset frame or another, which will give you access to new ways of problem-solving. 

However, you also want to push yourself toward the business owner, investor mindset. If you're going to grow, scale, and build your business, you MUST be able to approach problems from these perspectives. 

We often find that this is the most challenging shift to make. However, it can be learned, and you can master it. 

 

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