The Biggest Difference Between Being an Employee and a Business Owner
When I worked my first job out of college at an investment bank, I was told what to do.
Run this report. Create this model. Research this. Update that.
When I started my first business, nobody told me what to do.
Every day I got up, went to the computer, and had to decide how to spend my time.
If I spent my time well, the business grew. If I spent my time poorly, it didn’t grow.
This is the biggest difference between being an employee and a business owner – as a business owner, you decide how to spend your time. (You also can build a team to increase the leverage of your time.)
This is why time management is so important for entrepreneurs.
We All Have the Same 24 Hours in a Day
We all have the same amount of time every day to achieve our goals.
Regardless of your past, your current obligations, or anything that’s affected your life up until this point, when you get up in the morning, you choose how to spend your time.
Some people react to everything coming their way and let that dictate how they spend their time.
Others decide what’s most important and let that dictate their use of time.
There will always be way more to do than you have time available to do it in. You must decide what’s important in the long-term and short-term.
Prioritization is the most important skill of productivity.
What is most important to work on this year, this month, this week, today, and right now?
Discovering the answer to this isn’t easy. But, here is my best advice to use your time to create the most successful life possible.
My 5-Hour Workday
In 2011, I achieved my goal of becoming a millionaire by 25 only 2-3 years after starting my first business.
Today I own two 8-figure businesses with hundreds of millions of dollars in sales since their founding.
We have about 50 full and part-time team members between the two businesses.
While it wasn’t always this way, today I “work” about 5 hours per day.
My goal isn’t to work the least amount possible. My goal is to do the most meaningful work I can do, creating as much happiness for myself and others as possible (and, in business, to make as much profit as possible).
The average employee does less than 3 hours of meaningful work per day. So, even at 5 hours, I’m putting in 67% more work per day than most.
What matters is not the quantity of time you put in, but the quality of that time.
Here is my current schedule for almost every day of the workweek:
- Wake up around 7:00 AM
- Meditate and reflect on my previous day
- Work on my top priorities from 7:30 AM to 9:30 AM
- Take a break to stretch, talk with my wife, walk, and/or jump on my mini-trampoline
- Work from 10:30 to 11:30 AM (likely high-leverage meetings – see below)
- Take a break from 11:30 AM to 2:30 PM to workout and eat lunch
- Work from about 2:30 PM to 4:30 PM
- Clarify my top priorities for the next day
- Hang out with my wife and/or friends
I put in about 3 hours of high-quality work in the morning and about 2 hours in the afternoon.
During that time, I try my best to never check social media, the news, my phone, or even company email or Slack.
On the weekends, I follow a similar schedule, but only work a few hours in the morning (like I’m doing right now updating this post on Sunday at 9:49 AM).
While these are my normal “work” hours, I love learning, reading, and thinking. So while I’m not doing focused work, I’m usually doing one of those three which some would consider work (I consider part of my happiness).
Unless I’m working out, hanging out with my wife or friends, “working”, or on an adventure, I’m usually listening to audiobooks and coming up with ideas in my journal.
What’s Most Important to You?
My goal is to put in time every day moving toward what’s most important to me.
You can’t know what to do today if you don’t know where you’re trying to get to tomorrow.
If everything is equally important, there’s no way to decide what to do right now.
So, first, get clear on what you really want in the long-term (your big, life-defining world view).
For me, it’s to create happiness for myself and others.
Based on that overarching goal, I have 10 tactical goals related to money, relationships, and other achievements.
I’ve come to realize that the achievement of goals doesn’t make me any happier – the pursuit of those goals and the resulting growth along the way does.
So I set outcome-based goals to give me targets to shoot for, but the way I pursue those goals is what really matters to me.
Depending on your stage of development, your goals may be much simpler.
Maybe you just want to make money.
Maybe you want to quit your job and become a full-time entrepreneur.
Maybe you want to build a team that runs your business without your day-to-day management.
Get clear on what you want. Prioritization flows from clarity.
Know How You Spend Your Time Today
I’ve always had trouble gaining weight (yes, I know….no sympathy for me).
Years ago I decided to use a calorie tracking app called My Fitness Pal to track all the calories I consumed through eating and burned through exercising.
The reason I couldn’t gain weight was pretty clear.
I was doing a ton of exercise and not eating nearly enough calories.
(Tip: If you want to lose weight, track your calories consumed and burned using an app like My Fitness Pal for 7 days. What you find might surprise you.)
If you want to improve your productivity, you have to know where your time goes now.
We all think we’re productive, but that’s often not the truth.
We waste a lot of time doing stuff that doesn’t really matter.
So track your time for three full weeks. Track every minute of every day.
I’ve done this 5 or 6 times over the past few years. It’s not as painful as it sounds.
Create a spreadsheet that has these columns:
- Time entry #
- Time start
- Time end
Then, starting on day 1, record how you spend your time.
For example, an entry could be something like this:
- Time entry #: 1
- Time start: 7:00 AM
- Time end: 7:15 AM
- Duration: 15 minutes
- Description: Woke up, fed dog, made coffee
(This is literally how I start almost every day.)
You don’t need to record every time you go to the bathroom. What’s most important is you record how you spend your time working.
- Time entry #: 2
- Time start: 7:15 AM
- Time end: 8:00 AM
- Duration: 45 minutes
- Description: Analyzed
- Facebook advertising campaign for business to see why it’s losing money
If you start a task, add a time entry. If you stop it to check social media, add a new time entry.
You start to see really quickly if you’re bouncing around between too many tasks.
At the end of the three weeks, categorize how you spent your time using categories such as email, social media, meetings, project A, project B, etc.
Then, determine which items you can eliminate because they don’t need to be done at all.
Next, determine which you can delegate to someone else because they don’t need to be done by you.
Lastly, decide what you want to devote more time to in the future.
Use this data to plan your time going forward.
I recommend doing this three-week time tracking process once every 6-12 months.
How to Get More Out of Every Hour You Work
It’s said that it takes about 20 minutes to get in the groove doing focused work.
If you work for 15 minutes and then get distracted by an email notification, (1) you never really got into the groove with what you were working on and (2) it will take you another 20 minutes of uninterrupted time to get back to where you left off.
When I wrote a lot of the sales copy for our information product launches, people were amazed at how I could produce such a high volume of well-performing copy in such a short amount of time.
One day I wrote 100 sales emails in a few hours for a launch that produced about $10 million in sales in two weeks, much of which was driven by those emails. (Some copywriters charge $100 per email, so you could say I wrote $10,000 worth of copy in a few hours.)
How did I do it? “Speed writing”?
It’s amazing what you can get done if you completely shut off everything else and work for dedicated chunks of time.
Shut off every single notification and get rid of every distraction possible including:
- Extra stuff sitting on your desk
- Extra tabs open in your browser
- Icons on your computer desktop
- Phone notifications (ALL of them)
- Email notifications
- Slack or other chat notifications
If possible, I also recommend hanging a sign on your door to let other people in your house know this is focus time for you.
I have a “Do Not Disturb” door hanger I put on the outside of my home office door when I do my most focused work so my wife knows when I need some uninterrupted time. It may sound a bit extreme, but it’s better than the alternative of me not being fully attentive to her when she comes in because I’m completely focused on something important.
Then, set a timer for 25-50 minutes. I use a cheap kitchen timer from Amazon.
During the 25-50 minutes, only focus on one thing. You should have zero distractions to interrupt you, so the only interruption should be you deciding to jump to something else.
If you have trouble with this at first, use shorter time periods (such as 20 minutes).
When the timer goes off, take a break.
If you worked 25 minutes, take a break for 5 minutes.
If you worked 50 minutes, take a break for 10 minutes.
During the break, don’t do any work. Ideally, don’t do anything on your phone or computer (other than maybe listen to some music).
I prefer to get up and do some stretching or jump on my mini-trampoline which is believed to have some health benefits related to your lymphatic system.
To me, it’s just a fun way to get out of my head and into my body (the best kind of work break).
Repeat this process as many times as your schedule allows.
I put in completely focused, uninterrupted time every single morning before the “normal” workday starts.
Then, it’s usually time for meetings…
Meetings as a Source of Leverage
Warren Buffett, Founder of the $500 billion company Berkshire Hathaway, is said to have weeks on his calendar that are completely empty (no scheduled appointments) other than “Tuesday: Haircut Day”.
If Warren Buffett can run a $500 billion company with such few calendar commitments, I think we can all be a little less overcommitted.
I try to have the least amount of scheduled appointments on my calendar as possible.
I hate typical meetings. Most are a waste of time.
They’re unorganized, they lack purpose, and most could often be replaced by a well thought out email or Google Doc.
However, done right, meetings are a great use of leverage, especially if you have a team.
How do you turn a meeting that’s a complete waste of time into one a high-leverage tool for time management?
First, limit the number of people in attendance to the absolute minimum.
Even in Slack, which we’ll talk about shortly, I’ve been known to get quite upset when there are unnecessary people getting pinged all day long in channels they don’t need to be in.
Meetings are no different. If someone doesn’t absolutely need to be there, tell them not to attend.
Extra people in meetings is a waste of their time and yours.
Second, make sure there’s a clear agenda and purpose. If the person calling the meeting isn’t willing to write down and share the purpose and agenda for the meeting, don’t attend, it’s clearly not that important.
Third, make sure the same purpose can’t be accomplished with a well thought out written communication such as an email or shared Google Doc.
If one person can take the time to clearly communicate the same information by sending an email, letting the other people read it when it’s most convenient to them, it’s a way more efficient use of time.
If you have 5 people in a meeting with an average annual salary of $100,000 each, assuming a 40 hour workweek, every hour spent in a meeting with those 5 people costs $240 (($100K / 52 weeks in a year / 40 hours per week) x 5 people).
If one person can spend one hour writing a clear summary of the same information that would have been shared in a meeting and everyone else can spend 15 minutes reading it, you just saved about $140 (($100K / 52 weeks / 40 hours) x (1 hour to prep + 1 hour combined everyone reading it)).
If this happens once a day, every workday, you save over $36,000 per year in lost productivity ($140 x 5 days per week x 52 weeks per year).
Meetings allow you to share your viewpoints, get information fast, and collaborate quickly. But make sure each meeting is necessary, has a clear purpose, and only includes people who must be there.
I currently have about 18 hours of total meetings per month to run my two 8-figure companies.
Once we hire a marketing person for one of the businesses, my time commitment related to meetings for that company should be less than two hours per month.
My goal is to spend less than three hours per week in regularly scheduled meetings.
The Secret to Cutting Your Email and Slack Messages by 95%
I’ve seen business owners with tens of thousands of unread emails in their inboxes.
Right now, I have two.
What’s the difference?
I religiously unsubscribe from everyone’s emails and filter everything out I don’t need to see.
Every email that hits my inbox is directly for me and, other than maybe 1-2 emails a day, something I want to see.
But what’s the real secret to receiving less emails?
Don’t send emails (or Slack messages) unless you absolutely have to.
For every email you send, you increase the volume of emails you receive in return.
This includes brand new emails you compose and emails you reply to.
The fastest way to receive less emails is to send and reply to less emails.
If an email doesn’t absolutely need a response, don’t respond.
If someone wants something from you and the house won’t burn down if they don’t hear from you, don’t respond.
Most things can wait.
The more and faster you respond, the more people learn to depend on you for answers rather than figuring things out on their own.
If someone can spend two minutes writing you an email and get an answer to a problem they’re trying to solve versus spend 30 minutes figuring it out on their own, they’ll email you.
Congratulations, you’ve turned yourself into an encyclopedia.
If that same person knows they won’t hear back from you at all, or at least not in the next 24 hours, they will learn to be more self-reliant and solve problems without you.
Voila! You’ve trained that person to become a better resource for you and your company.
This same principle applies to Slack and other chat tools.
I think Slack (and any company chat tool) is terrible for productivity.
Most people sit there with it open all day long waiting for it to ping. They call this “work” and do this instead of focused, productive creation for the business.
I haven’t been able to win the battle internally to completely quit Slack as a company, though we did downgrade to the free plan saving us $500 per month.
So I do my part and try to be as unresponsive as possible on Slack. I also try to message people the least amount possible, relying instead on the few critical scheduled meetings to communicate with those people.
On any channel, especially Slack, if it takes more than 4 written communications to solve a problem, I recommend jumping on a video call (e.g., Zoom).
Why I Don’t Have an Executive Assistant
I once read an article about a highly successful startup (I can’t remember which one and can’t find the reference – maybe Redfin?) in which the founders basically said they don’t have assistants because they wouldn’t know what to do with them.
The article said this company produced hundreds of millions of dollars in annual revenue.
Yet, here I was, thinking I was king of the mountain, with a much smaller company, feeling like I must have an executive assistant.
The problem with having an executive assistant is you need to come up with stuff for him or her to do. In my experience, that stuff is usually low-level activity I don’t want cluttering up my schedule anyway.
More emails. More calls. More meetings. More travel.
It’s great if you can have an assistant coordinate all that, but what creates the need in the first place?
I had a full-time assistant for about 5 years. Towards the end of her employment with us, as I became more focused with my time, I didn’t have much for her to do. We then moved her into different roles in the company because I no longer had much use for an executive assistant.
I didn’t have enough for her to do because most of what I needed to do to grow my business was handled by other people in the company (as it should be).
I prefer to solve the root problem. As Peter Drucker said, “There is nothing quite so useless, as doing with great efficiency, something that should not be done at all.”
Why are you getting so many emails in the first place you need an assistant to manage them? Maybe you’re a bottleneck for too much within your company. Maybe you just need to spend a few hours unsubscribing and filtering 90% of our emails out permanently.
Why do so many people need to schedule meetings with you? Likely because you haven’t properly delegated responsibilities to other people.
Unless your company is doing a few hundred million dollars a year in revenue, I think an executive assistant is a waste of money. It’s better to remove yourself from the operations of the company and empower your team to grow your business.
What About Personal Errands and Responsibilities?
I’m quite fortunate. My beautiful wife of 9+ years is incredibly organized and has likely never procrastinated in her entire life (unlike her husband).
She takes care of almost all of the scheduling, booking, and maintaining of our personal lives.
Callie pays the bills, hires people to fix stuff at the house, books our travel, makes sure we keep up with our friends, and manages a hundred other things in our life.
If you find personal responsibilities take up a large amount of your time, first, consider simplifying your life.
If you have a larger-than-necessary house, multiple homes, extra cars, a high-maintenance house, lots of personal obligations, too many clubs and committees, and overall too much personal stuff to manage, get rid of everything you don’t absolutely need.
I know an entrepreneur who lives here in Austin, TX, has lived in the same small apartment downtown for 6 years, doesn’t own a car, and spends most of his money hanging out with cool people (what he really likes to do).
His life is simple. Living in a small apartment means less stuff he can buy. Not owning a car means no car maintenance, no car storage, and no traveling too far to go shopping locally.
The simpler your personal life, the more time you have for what matters most to you.
Second, if you still have too much personal stuff to manage, hire a part-time personal (non executive) assistant too take care of grocery shopping, house cleaning, cooking, home maintenance, and anything else you don’t need to do yourself.
Some of the best money you can spend to increase your happiness and productivity is to get all of those things taken care of to free you up to grow your wealth.
Summary: The Simple Solution to Make More Money in Less Time as an Entrepreneur
I firmly believe that if you want to, you can run a successful, growing, multi-millionaire company in just a few hours a day.
Getting there in the first place, when you’re learning and figuring everything out the first time, is likely going to take more time.
But, once you’ve laid the foundation, the whole point of being a business owner is you get to leverage other people to grow your wealth and impact.
If you’re still working 12 hour days just to maintain a modestly-sized business (less than a few hundred million in revenue), you’re doing something wrong.
Here’s the solution to a bigger impact with your time:
- Clarify what’s most important to you (your big life-defining world view/goal) and 3-10 sub-goals
- Do a time audit (track your time each day for 7 days) so you can see how you’re spending your time now
- Review your time audit and determine (1) what you can eliminate, (2) what you can delegate, and (3) what you should spend more time on
- Work in 100% focused, single-task chunks of time (25-50 minutes)
- Make sure every meeting you attend is a source of leverage, not a waste of time
- Send less emails and Slack messages
- Before hiring an executive assistant, figure out what’s really causing the need for one and solve the root problem
- Simplify your personal life to free up more time
I want to be happy and create happiness for others. I want to build great companies and share what I learn along the way.
If this means I put in 5 hours of dedicated work per day, great. If it’s 8 or 9 or 10, and I’m loving every day, that’s great too.
Most of the time, I do what I love to do. I’m building, creating, leading, and contributing.
Our time is limited. Aim to spend it doing what matters.
Be happy. Create. Help others.
The best way to free up the most time as a business owner: This article has primarily focused on your time. No matter how efficient you get, you will miss the biggest time saver of all, building a team. Read this article to learn how to build a world-class team so you can finally work on your business, not in it >>