Thinking of quitting your day-job to found a start-up? Don't, but read this first.
I have always found the dichotomy between a 'entrepreneur' and a 'salaryman' to be ambiguous at best. If I had to distill it, it would simply be 'price-setter' and 'price-taker'.
A salaryman is a price-taker. To be a salaryman, you are hired by a particular corporate entity, to wait on a monthly wage regardless of profit/loss, and perhaps a year-end bonus to reward you proportionally for the company's overall performance for that financial year. In large corporations, you will almost never gain access to stock options (or in funds, carry) at a starting position - only partners (sometimes, principals/VPs and below) will receive equity, that is, the portion of the profit pie. A salaryman waits month after month, year after year, for his bonus, raise, promotion. Rinse, repeat, perish. The upside of such a passive pursuit is possible the illusion of stability that brings - I say illusion, because stability is not necessarily less risky, especially in the context of a shrinking Japanese economy.
An entrepreneur (be it a tiny coffee-shop owner, or a billion-dollar unicorn) is a price-setter. An entrepreneur hires himself, issues his own equity stock and originally allocates the appropriate portion to himself, perhaps some to a co-founder, other team members. If an angel investor comes along, he may be 5-10% of the equity pie. He then creates a product and sets a price for it, be it $19/mth for a SaaS offering, or free user subscription but sell-side consultancy services from the user data he accumulates. Whatever. He (together with his self-assembled team) is wholly responsible for the success of the company. To make this understanding of price-setter even more complex, the definition of success may usually be mean ultimately being profitable to the layman, but - surprise, surprise - that is not necessarily the case for a startup. There are many stages a startup undergoes, be it surviving the J-curve, getting product market fit to finally fit and getting traction on the way, scaling aggressively beyond the first market, or monetizing the existing pool of users. Tesla was (and is still) hardly profitable, and kept registering loss annually, but they were growing massively. As a startup, we look at acceleration more than destination, momentum more than position. Because of that, equity represents more than (eventual) profit, in a more philosophical sense it boils down to ownership and a stake in the new path you are blazing for your team.
Essentially it all boils down to this thought experiment. If you are hired by Large Conglomerate X and paid $100 every month, and if you have registered your own Company Y and got a contract with X to provide consultancy service/product offering at $100 every month, do you see a difference? What is the difference?
Let me leave you for now with the following resources. Perhaps you might think about embarking on this price-setting journey in due course:
Y Combinator How to Start a Startup — http://startupclass.samaltman.com
Y Combinator Startup School - https://www.startupschool.org/latest
Paul Graham Essays http://www.paulgraham.com/articles.html
If you've churned (pun unintended) through all of these, and still are reporting for work at 9am, ping me and let's talk.
