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Entrepreneurship – a career path

Use this scenario to help young people to learn the differences between being an employee, a self-employed, a business owner, and an investor.

Description

When to use it:

  • discovering entrepreneurship as a career option;
  • learning the differences between being an employee, a self-employed, a business owner, and an investor.

Size of the group: 5 to 15 people

Age of the group: over 14 years old

Time:

Preparation: 30 minutes

Presentation: 60 minutes

Materials:

  • flipchart papers
  • markers

How:

Preparation:

  • Watch the video on cashflow quadrant here: https://www.youtube.com/watch?v=yywKO_xqXIY;
  • Prepare the story to use, and possible solutions for step 3., so that the participants can understand the difference between S and B quadrants.

Presentation:

  1. On a flipchart paper, brainstorm with the participants the potential sources of revenues / incomes they might have once they get out from school.
  2. Using the answers given by the participants, draw on a new flipchart paper, and explain the following cashflow quadrant (developed by Robert Kiyosaki):

    E

    (Employee works for others)

    B

    (Business owner – others work for him/her)

    S

    (Self-employed works for him/herself)

    I

    (Investor – money works for him/her)

  3. Split the participants in groups of five people, and tell them the next story, adapted from Robert Kiyosaki:

    “Once upon a time there was a little village, a great place to live, except one problem. The village had no access to water, unless it rained. However, close to the village there was a river that could be used as source for clean water. To solve this problem, the village elders asked different contractors to submit ideas to deliver water to the village on daily basis”.

    Each group of five people represents a contractor contacted by the village elders. At this moment the contractors are working people from the village who village elders thought they might be more entrepreneurial and help the village to find a solution to deliver water everyday, and come with their business idea.

    Ask the participants to work in groups and come with solutions to the village problem. After 20 minutes, ask each group to present their idea.

    From the discussions, or from the feedback you provide, two stories should emerge:

  • one is the story of a self-employed / a small business: for instance, the participants could say that they will work everyday in a business bringing fresh water from the river in buckets or other recipients; they will be working hard to deliver water to the city;
  • the second story is the one of a business owner, who decides, for instance, to spend some time to find some investors who will pay for building a pipeline system, and then to hire people to set up the system and to keep it running; and who is also interesting in developing the business to other villages and provide through the pipeline water to more villages.

Though this game, the participants should understand the main difference in vision between self-employed and business owner. At the same time, they also see what could be the role of an investor.

  1. Recap with the participants the quadrant, and insist in the presentation on the following characteristics, adapted from Robert Kiyosaki’s book: Rich Dad’s Cashflow Quadrant. Guide to Financial Freedom (2012).

An Employee might say: “I am looking for a safe, secure job with good pay and excellent benefits.”

A Self-employed might say: “My rate is $75 per hour.”  Or “I can’t seem to find people who want to work and do the job right.”  They are people who want to be their own boss, and they only believe the in the quality of their work. While employees respond to fear of not having money by seeking for security (a secure job), the self-employed persons respond to this fear by taking control of the situation and doing what they know best.

A Business owner might say: “I’m looking for a new president to run my company.” Usually they surround themselves with smart people from the other categories. To be a successful B, one should own or control a system, and to have the ability to lead people.

An Investor might say: “Is my cash flow based on an internal rate of return or net rate of return?”. The investor makes money with money, the money is working for them. Kiyosaki says that this quadrant is the “playground” of the rich.

Follow-up questions

  • What will be the quadrant that you see yourself in, based on your values / interests?
  • What do you think is the most important thing that you need to keep in mind the go from the E quadrant to the B quadrant?

(Here you can guide the discussion by explaining Kiyosaki’s point of view, who says that there are a lot of entrepreneurs providing superior products or services than those of multinational companies, however in order to compete or compare with a multinational corporation is important not to create better products, but better business systems).

Possible variations

For the step 3., you could use a different story, adapting it to the audience of the workshop.

Other resources:

Read how to attract business investors, when you want to become a business owner, here: http://www.iseeyou-network.eu/files/8514/5579/7112/Business_Angel_Attraction_Plan.pdf

Robert Kiyosaki, Rich Dad’s Cashflow Quadrant. Guide to Financial Freedom (2012).

 

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