The difference between a Business Owner and an Investor

the difference between a business owner and an investor
Tired of reading, then listen.
The terms business owner and an investor, for a long time, have been inappropriately used in the context of what they rightly qualify which has led many to front a false identity.

Many people in the business world are often confused that being a business owner automatically qualifies an individual to be addressed as an investor. It is a big misconception, and today’s article would indeed give clarity to their disparity.

Being a business owner and an investor falls into two separate business quadrants therefore, different skills are required to perform well as a business owner and separately as an investor although, share a few similar skills. Leadership (the ability to work with and lead people), being a good listener and a good master of words, having technical skills of business, like marketing strategies, management, negotiations, accounting, production, sales, and the ability to read financial statements are core skills of a successful business owner while high risk-taking, flexibility, smart and calculated personal decision making, confidence, and persistency are core skills of an investor.

Arguably, both a business owner and an investor need to master unique skills such as negotiation skills, risk-taking, financial forecast, and market prediction. These are all key to the success of any business. In other words, an investor needs a successful business to expect a good Return on Investment (ROI) therefore, an investor must find a good businessman that ticks the assurance box and, it takes a good businessman to find one.

The language of a businessman and an investor are different from one another. The former is directly involved in the day-to-day running of a business while, the latter is indirectly involved (that is, his actions are influenced by the day-to-day activities seen in a business). By professionally listening to the words of a business owner, you can decode the difference from an investor. While a business owner might say, “I need more than capable hands to run my company,” an investor might say, “I need to buy more stocks to improve my rate of return.” Can you feel the difference in the way they both sounded? These are two different approaches to maximize profit.

A business owner creates a system and hires people to run and manage the system to keep the business thriving thereby, accumulating wealth. An investor takes advantage of an already existing thriving system to accumulate wealth.
A business owner makes do of his time but majorly other people’s time and efforts to run a business to accumulate wealth. An investor makes use of money to make money. Investors don’t work for money; money works for them.

Furthermore, only successful business owners can develop into successful investors by developing business expertise to become better investors. Only investors are capable of investing in businesses of business owners. Investors invest in businesses with business systems that work and, in some cases, provide more than money; suggest ideas to improve the business.
With these clarifications, we assure that some, if not all disparities, have been addressed. Hopefully, people in the business world who are ignorant of this would know the category they fall in and develop the core skills and techniques needed to thrive. A successful businessman doesn’t have to be an investor, but on the other hand, an investor must have depth knowledge of doing business.


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