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People enter entrepreneurship with the mindset that their creation will “change the world.” The question is: what is the cost of changing the world and, more importantly, who pays?
Even fictional heroes need to plan their budget accordingly. There’s a reason why our most recognizable superheroes — the Tony Starks and Bruce Waynes of comic book fame — are all accomplished, generationally wealthy billionaires who have plenty of time and money to deal with bigger, more mundane problems. Also Mission Impossible The IMF team was hired specifically to stop the bad guys and get a big chunk of change. Everyone wants to be a hero, of course. But the fact of the matter is that no one can afford to save the world for free.
Truly passionate entrepreneurs can find themselves struggling when it comes to monetizing their efforts, especially when their primary goal is not profit. When the harvest is for the greater good, whether for the gain of one person, the community, or humanity as a whole, altruistic entrepreneurs find themselves immobilized when forced to put a price on their creation. The various scenarios in which an entrepreneur could work for free:
- Family or social obligations: The desire for support and sharing, combined with the informal nature of such relationships, can lead to scenarios in which work is severely undervalued or undercompensated.
- Passion projects: When an entrepreneur is deeply invested in the outcomes of a project, he or she may prioritize its completion or overestimate its impact without immediately thinking about the financial costs of the effort.
- Beta testing: Offering services for free for a case study or as a beta test could be a way for entrepreneurs to demonstrate results and capabilities to win long-term business.
- Build skills and experience: Growing one’s skills and gaining valuable experience can easily incentivize an entrepreneur to work without compensation as an apprentice or mentee, especially when it also offers a path into a new industry or network that is typically not accessible to them.
- Market penetration: Offering free trials and sample work can help individuals and new businesses enter a new market, launch a new product, and attract a hard-to-reach customer base.
The list of reasons why an individual might work for free is exhaustive and can include many other incentives such as strategic partnerships, philanthropic contributions, and even educational purposes. The 2021 Volunteering in America Report found that 60.7 million adults (23.2%) volunteered 4.1 billion hours. For an entrepreneur, unpaid or low-paid work, while full of potential, requires a slice of the entrepreneur’s most precious resource: time.
Related: The only 2 good reasons to work for free
As a currency in its own right, time is paradoxically unlimited and yet finite for the entrepreneur. The essence of the entrepreneurial spirit – ambition, passion and a relentless drive – can veer into murky waters if left unchecked, especially when commitments continue to pile on top of one another.
Many business owners work 60+ hours each week serving customers, juggling business operations, managing employees, volunteering, and balancing family and friendship obligations. But doing all this is not worth a medal or the front page of the newspaper. In a survey of startup founders around the world, Startup Snapshot found that 72% of founders experience mental health issues: over 37% suffer from anxiety, 36% experience burnout, and over 81% report of feeling the need to hide stress, fears and challenges from others. Superheroes rarely take into account the toll their battles take on their psyche, and even entrepreneurs can overlook the mental and emotional toll of their endeavors.
Another unintentional dark side of entrepreneurial hero work is one that many so-called “value” workers have faced in the past: the more you do, the more you are expected to do. Many customers, eager to benefit from the dedication and helpfulness of budding businesses, often feel free to cross boundaries, contacting at all hours and expecting immediate responses. How many times has a customer called at 10pm, or on a weekend, expecting an urgent job to be completed without complaint or, more importantly, without additional compensation? For new entrepreneurs who put customer satisfaction first, this could be a sincere occasion of joy. But in trying to build a reputation that shatters expectations, the question arises: when does ambition become an exploitable liability rather than an asset?
For an entrepreneur, how one’s time should be allocated is a decision that must be made with careful consideration, and for any initiative to continue to have a real and notable impact, it must also be financially sustainable. Time, effort and resources are all unique and just as valuable to a growing business as the passion that fuels it.
Related: Entrepreneurship Can Be Exhausting: Try These 3 Strategies to Restore the Joy.
To better navigate the relationship between generosity and professional standards, entrepreneurs can adopt strategies that respect both their intrinsic value and their entrepreneurial spirit, while still safeguarding their personal well-being. Here are some suggestions:
- Outline your program: There are only 24 hours in a day without a time turner. Therefore, it is crucial to set limits regarding specific times you are available for various types of work, including unpaid projects. The goal is to help manage expectations and prevent overcommitment.
- Set clear boundaries: Be honest about the value and/or cost of your time. Communicate clearly when work is offered as a favor, as part of a strategic partnership, or with the expectation of future reciprocity. Even between friends, a clear contract or agreement can help prevent future misunderstandings.
- Prioritize time management: Use time management tools and techniques to ensure time is allocated efficiently. Not all free work offers the same return in terms of exposure, experience or business potential.
- Appropriately evaluate your work: Understand the market value of your services and strive to maintain that standard. It’s always easier to start with a higher price that has a broader scope and lower the price than to start with a price that’s too small.
- Keep your contribution threshold under control: Regularly evaluating your contribution threshold helps keep an eye on the entrepreneur’s capacity. Driven by passion and motivation, a regular check-in offers a moment of reflection to evaluate whether the time, energy and resources used are in balance with the benefits received. An imbalance can manifest itself in financial difficulties, lack of personal time, or decreased passion for work.
Balance is key to sustaining the impact and viability of your efforts. When it comes to the success of any venture, entrepreneurs need to be comfortable in the space between fervor and practicality. Mastering these dueling motivations is crucial; Recognizing the true value of one’s efforts ensures that the vision does not just survive the early stages of motivation-driven growth, but thrives with sufficient fuel and funds, without compromising the entrepreneur’s mental, physical and emotional well-being in attempting to change the world.
Generosity in pursuing a vision should never overshadow an entrepreneur’s professional value. Time and energy are not infinite, but rather finite.