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5 Differences Between Freelancing and Owning a Business

By: Usman Raza


Differences Between Freelancing and Owning a Business

There is a big difference between freelancing and having a business of your own. Although both invest in resources, require planning, getting leads, developing a skill, and are in need of ideas, there are major differences between these two entities.


Many businesses need the expertise of freelancers; name the type of office work you need, and freelancers can deliver that work, such as:

And these are just the most common industries that hire freelancers; the list just goes on much longer.

Owning a Business

On the other hand, as a business owner, you may be the one in need of freelancers. You may be a professional or an owner of a:

Virtually, almost every business that is web based would be in need of freelancers.

The Top 5 Differences

There are many factors you have to look into to determine the difference between the two.

Sustainability and Profitability

There’s no denying that freelancers may earn a heap depending on the years of experience, quality of work, professionalism and so on. If you start young, then you can take advantage of your youth in this industry to earn and save up.

On the contrary, a business can be more profitable in the long run, especially if you have a good marketing scheme. If you offer products or services where the demand is just steady or goes up, you can definitely forecast your business’ profitability.

Also, your business can grow old with you and can continue generating money even without you. Meanwhile, freelancers need to work and deliver–otherwise, they will not get paid for the service they provide.

Who’s the Boss

As a business owner, you know you are the boss. Also, you manage people, you implement in-house rules and apply labor laws, and you finance the salary of your employees. You may be the boss and the owner but you still have to deal with all these things.

However, seasoned, experienced and smart freelancers can actually have the upper hand between them and the client. Freelancers who have been in the industry for quite some time have already built their confidence in terms of their clientele.

They can be in control of the situation. They can provide insight, influence clients, demand on their rate, determine their schedule. In some cases, a freelancer can bring their work anywhere in the world and their client doesn’t even have to know. What is important is for them to deliver what needs to be done.

At times, freelancers can also terminate their contract with their client. Basically, as a freelancer, you can choose your clients. Sounds like a boss, right?

Skills and Ideas

Freelancers look for clients based on their skillset. Skills also determine their earning potential. On the other hand, owning a business is in need of continuous flow of ideas, especially if the business is not doing well.

The marketing aspect of the business can never be stagnant. It has to ascertain the trends in business marketing if it’s applicable for the company or not. It is where advertising comes into play because this is the powerhouse of marketing.

Business thrives through ideas while freelancing survives with skills.


Owning a business can be likened to parenthood. It needs to be meticulously taken care of after conception until it is fully established. In other words, you really have to invest time in your business, especially in its initial phase. Most of the time, owning a business means that you have to work longer hours and the only luxury of time you have may be a couple of hours of sleep.

In contrast, most freelancers can determine their own schedule. They can work at their own pace—without compromising on the deadline of their work. On certain jobs, clients do not tell freelancers to be on time or to work on specific hours, not unless your work requires interaction.

End Goal

This is really the “make it or break it” factor. It is to leave a legacy or not. It is where you need to decide if freelancing or owning a business can actually upgrade your life in the long term.

Certain questions are needed to determine if this will give you financial freedom. Both freelancing and owning a business are profitable in their own ways but between the two, owning a business is surely sustainable.

You can be your own boss with either having your own business or freelancing. Although, with freelancing, depending on the job, you do have time freedom.

Freelancing and owning a business can work hand in hand for an individual. If you are younger, you can start with freelancing using your skills because you can earn as much while you have freedom of time. It can give you enough time to develop yourself in the process of having your own business. Whether you like it or not, when the time comes to retire, you still need to consider your finances.

If you think you can still work as a freelancer at a very ripe age, you can do so. However, if you opt to have a more fluid and passive income, having your own business can definitely do this for you. Both entities have their pros and cons but ultimately, either one can be very beneficial.

Published: January 22, 2020

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usman Raza

Usman Raza

Usman Raza is a CEO of Usman Digital Media and co-founder of Christian Marketing Experts, content marketing specialist at webdaytona.com. He has been writing for magazines and newspapers since 2001, and editing and managing websites since 2006. Usman has a BA in Business Development, Philosophy, and English. A generalist, his most covered topics are business and technology. When not working, he’s probably spending time with his family.

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