The Founder vs. Employee Mindset Gap: Why Most People Can't Handle Entrepreneurship

Today I want to talk about the difference between a founder versus an employee mindset and why most people cannot handle entrepreneurship. So to give you an example of what I mean, I had launched with two friends last week. So one works at Google and the other just sold his startup for eight figures. The Google employee complained about his boss is 401k how he deserved a bigger bonus this year and keep in mind he's already making a ton of money. The founder talked about his next three companies some emerging tech that he's studying how he's structuring his time to maximize learning while the non-compete clause runs his course. Same education similar intelligence completely different universe of thinking and this gap isn't just about ambition or work ethic it's about how these two people fundamentally view the world employees optimize for stability founders and entrepreneurs they optimize for optionality one trades time for money the other trades uncertainty for upside and this invisible divide determines who built wealth in today's economy and who remains perpetually stuck in the middle class regardless of their salary let me explain why because most people are hardwired to seek safety and it's not their fault it's how we're built our brains evolved in a time when consistency meant survival unpredictable environments they meant death now today that same evolutionary programming steers people towards the perceived safety of employment which looks like fixed salary clear job description defined working hours external validation someone else making big decisions that is employment and the entire structure of employment caters to our primitive need for certainty every two weeks money hits the account every year you get a performance review every few years you earn a promotion if you follow the rules right and this isn't just a preference it is deeply ingrained in our minds and most people never question this ingrained mindset as nval rava comp puts it earn with your time and you're trading a non renewable resource until you have no more time left and the employee mindset is just not optimized for wealth creation that's optimized for risk minimization and that is a fundamental trap because true security doesn't come from avoiding risk it comes from controlling your own destiny now founders operate from an entirely different paradigm employees they always seek to minimize downside but founders they're obsessed over maximizing optionality the ability to capture all these unforeseen opportunities if you watch any successful founder you're going to notice that they constantly are building multiple potential paths forward they create assets that can appreciate without the direct involvement they make bets that cost a little but could return exponentially and they explore all these adjacent possibilities and this explains why founders seem so comfortable with uncertainty it's not that they enjoy chaos it's that they see uncertainty as this playground for opportunity that others cannot perceive i remember talking to a founder who had just walked away from a three hundred thousand dollar per year job to start a company in a very unproven market and when i asked about risk he looked genuinely confused and he said the real risk would be spending the next twenty years building someone else's dream while my skills grow more specialized and less transferable every single year so he wasn't being cavalier about all the challenges ahead he was simply recognized the truth than most people miss optionality is the ultimate form of security in an unpredictable world now let's put some math behind this the math behind these two mindsets creates entirely different financial outcomes and trajectories so if we look at the employee equation and the input is say 40 hours per week that's your time the output is linear compensation because salary plus like a modest bonus there's a ceiling depending on the industry position and company performance and there's zero ownership ownership is 0% or negligible equity that you really can control now the founder equation while the input is value creation which is uncapped the output is exponential returns because you have an ownership stake the ceiling is unlimited and the ownership is significant and it's a significant stake in the outcome and this structural difference is mathematical difference is why employees hit wealth plateaus while founders can see geometric growth even high paid employees doctors lawyers executives they reach points where their time simply cannot be valued any higher they're still trading hours for dollars just at premium rates meanwhile founders can create systems that generate value whether they're working or they're not their compensation isn't tied to their time but to the value of what they've built now a great mark Cuban quote the captures this is that the only difference between a rich person and a poor person is how they use their time time spent building assets is fundamentally different than time spent earning a wage now if the founders path is so clearly superior for building well why does never want to take it and the answer is very simple fear and not just any fear but very specific types of fear that paralyze most people first kind of fear is fear of a regular income employees are addicted to the predictability of a regular paycheck the thought of months without revenue terrifies them even if the long-term math works in their favor i've seen people turn down business opportunities with 10x their salary potential because they could not stomach the thought of three lean months to fear of public failure employment offers anonymity in failure if your project fails at a big company very few people outside of your team are ever gonna notice now entrepreneurship means failing in the open with your name attached and for a lot of people this social risk is more frightening than financial risk and three the fear of autonomous decision-making most people secretly prefer being told what to do making high stakes decisions without perfect information is emotionally taxing now employees can always put in the boss the company or even quote unquote the system when things go wrong founders own every outcome the good and the bad and these fears aren't rational assessments of risk they're emotional responses they prevent people from seeing entrepreneurship clearly because the biggest barrier to building well isn't lack of opportunity it is a psychological resistance to uncertainty i want to tell you a quick story about Jeff Bezos he famously distinguishes between one way and two way door decisions what does this mean first of all just to give you some context this is a great idea to help you understand uncertainty and risk and sort of get rid of some of those fears that you have so what is a one way door and what is a two way door so one way door decisions cannot be reversed once you walk through that door you can't go back two way door decisions can be undone if they do not work out you can always return to where you started now most people mistakenly if you want to partnership as a one way door they believe that if they leave their job and fail they are ruined forever now the reality is that starting a business is almost always a two way door if it doesn't work the job will still be there your skills aren't going to evaporate and your network will not abandon you i know hundreds of entrepreneurs even those who have failed spectacularly landed on their feet often in better positions than when they started and even if you didn't fail sometimes they still go back to work CEO one of my good friends he built two companies exited now he's CEO of a publicly traded company at a very young age he wouldn't have got there if it wasn't for entrepreneurship and being able to fast track his skill development now for some reason people think that the skills that are developed while building something from nothing are i don't know not relevant but they are truly invaluable in the marketplace but the employee mindset it catastrophizes this risk it imagines homelessness and destitution if they're business or their venture doesn't succeed which is so not realistic the greatest risk is at homelessness it's not like it's going to happen the greatest risk is spending your one life in the safety of choices you know won't fulfill your potential that to me is so sad but i don't think people get it i don't think employees get it you get one shot at this now another thing that separates these two mindsets is one word ownership employees rent their careers founders own their future and this ownership it manifests in a few different ways there's financial ownership strategic ownership schedule ownership relationship ownership this is what entrepreneurship is you are not outsourcing your career your life to someone else you own in terms of financial ownership you own equity a piece of what you're building there's a strategic ownership you have to focus your energy on the highest leverage activities in terms of schedule ownership yeah you work intense hours but you control when and how you work and in terms of relationship ownership you decide who you serve and who you learn from and the cumulative effect of these ownership elements they compound over time and this creates this widening gap between employee and entrepreneur another navel idea on the topic is that you won't get rich renting at your time because you can't earn non-linearly and without ownership which is a key tenant in entrepreneurship you are building wealth in handcuffs and the hardest truth for most people to accept is that they are not embracing entrepreneurship because they are not ready to face accountability they're not ready to face ownership over their own life their own career employment it provides this very comforting illusion you know if i'm doing everything right if i'm not getting ahead it's because like the system is stacked against me right and this narrative protects your ego but it keeps people stuck now entrepreneurship it's scary because this trips away all these excuses the market doesn't care about your effort your intentions or your credentials it only rewards results and this is a uncompromising feedback mechanism which is what many people are desperate to avoid but it accelerates founder growth it accelerates entrepreneurship growth if you are comfortable leaning in and i've worked over my career with employees that are looking to advance in their career and i've worked with founders that are building companies and the contrast is just incredible employees want strategies to navigate office politics and impress their boss founders want their blind spots exposed they can eliminate weakness one seeks comfort the other seeks the truth and the moment you become genuinely willing to fail and take ownership and take accountability you have already succeeded at the hardest part of entrepreneurship so for everybody listening you have a choice before you this podcast was meant for both people that are working within companies right now and for people that are just deciding if they want to get started but you have a choice right you can be an employee or a founder you stand at a fork in your career road on one side you have a path that leads to stability linear growth lower peak stress and candidly a cap on your potential both economically and psychologically and on the other path you have volatility exponential upside intense challenges the opportunity to discover what you're truly capable of creating now neither path is objectively right for everyone but i want you to make the choice consciously not by default i want you to choose employee or entrepreneur employee or founder i want you to start to ask yourself do i want to optimize for stability or optionality am i willing to trade short-term comfort for long-term wealth can i handle periods of intense uncertainty for the possibility of breakthrough results am i building my life around avoiding failure or achieving success and your answers are going to tell you everything about which mindset you are currently operating from and what aligns with your true goals and by the way the choice that you make and change throughout your life and your career when you're starting out when you're young i think you should default towards entrepreneurship and founder because that's when you can take risk and there's not a lot to lose when you get a little bit older you have responsibilities maybe you can choose the other path of stability linear growth after you've tried entrepreneurship but please please please make a conscious choice don't accept the choice that your parents put in front of you that your friends put in front of you that your university or college or your high school put in front of you make a conscious choice because again you have one shot at this life and you understand that there are two paths in front of you and most people default can you imagine that they default their entire life to just what they've been told that to me is the saddest realization to wake up on your 90 and think what if i tried something different but you just never had the hutspa to go do it and i'm not going to lie to you the gap between founder and employee thinking it's significant it's not just about career choices it is truly about how you approach your entire life but i'm telling you it is worth going deep looking inside and thinking about which kind of life you want to have the end of the day the majority of employees they wait for permission the majority of founders granted to themselves two very different ways of living your life what's them thought into it because whether or not you wait for permission or you granted to yourself whether or not it's in business or just life those two paths and choosing which one you want to go on it makes all the difference