Why Becoming an Entrepreneur Might Not Be the Best Way to Earn More Money in Malaysia
Entrepreneurship is often portrayed as the ultimate way to financial freedom. You hear success stories of people who quit their 9-to-5 jobs and built million-ringgit businesses. Social media is filled with influencers promoting the idea of being your own boss and achieving financial independence through business ownership.
But the reality is far more complex. While some entrepreneurs do achieve massive success, many struggle for years or even fail entirely. If your goal is simply to earn more money and achieve financial security, starting a business may not always be the best path. In Malaysia, there are several reasons why traditional employment or alternative investments might be a smarter choice.
1. High Initial Investment and Financial Risk
Starting a business requires huge capital, whether you are opening a café, launching an e-commerce store, or developing a tech startup. Entrepreneurs need to cover expenses such as rent and utilities, especially in major cities like Kuala Lumpur and Penang, as well as equipment, inventory, website development, marketing, and employee salaries if they hire a team.
Many rely on personal savings, loans, or even credit cards to fund their ventures, which can be extremely risky. If the business fails, they may find themselves burdened with massive debt and no stable income. In Malaysia, SMEs (Small and Medium Enterprises) face a high failure rate, with nearly 50% shutting down within the first five years due to poor cash flow management, intense competition, and market saturation, according to SME Corp Malaysia. Without proper financial preparation, starting a business could lead to more financial struggles rather than success.
2. Unstable Income vs. Steady Salary
One of the biggest disadvantages of being an entrepreneur is the lack of a stable income. As an employee, you receive a fixed salary every month, along with potential bonuses, allowances, and benefits like EPF (Employees Provident Fund) and SOCSO.
On the other hand, entrepreneurs experience income fluctuations. Some months, you may make a good profit. Other months, you may struggle to break even. If your business does not take off, you might go months or even years without a proper salary.
Meanwhile, professionals in high-paying fields—like IT, finance, engineering, and medical industries—can earn RM8,000 to RM15,000 per month within a few years of experience. This provides a predictable income stream that allows for better financial planning, investments, and savings.
3. Market Saturation and Fierce Competition
Malaysia has a highly competitive market, particularly in industries like food and beverage (F&B), e-commerce, and digital services. New cafés and restaurants open frequently, but many shut down within a year due to high rental costs and operational expenses. In the e-commerce sector, platforms like Shopee and Lazada are flooded with thousands of sellers, making it difficult for new businesses to stand out. Similarly, many aspiring entrepreneurs venture into freelancing or digital services by starting agencies or consultancies, but they often struggle to secure clients due to competition from well-established firms.
Unless a business offers a truly unique product or service, competing against larger and more experienced companies can be extremely challenging. Even with strong branding and marketing, customer loyalty is difficult to maintain, especially in price-sensitive industries where consumers prioritize affordability over brand recognition.
4. High Stress and Poor Work-Life Balance
Many people start businesses believing they will gain more freedom and flexibility, but the reality is often quite the opposite. Entrepreneurs typically work longer hours than employees, juggling multiple responsibilities with little time to rest. Instead of the structured 9-to-5 schedule that comes with traditional jobs, business owners often find themselves working early mornings to handle supplier orders, staying up late to resolve customer issues, and sacrificing weekends to manage paperwork, marketing, and operations.
The stress of running a business can be overwhelming, as entrepreneurs must constantly deal with cash flow problems, hiring challenges, and customer complaints. This relentless pressure can take a serious toll on both mental and physical health, leading to burnout and exhaustion. Unlike employees who can clock out at the end of the day, business owners carry the weight of their company’s success or failure on their shoulders at all times.
In contrast, corporate jobs often provide essential benefits that support a healthier work-life balance. Employees in multinational corporations (MNCs) or tech companies, for example, may enjoy paid leave, medical benefits, and flexible working hours. Additionally, career progression opportunities such as promotions and salary increments offer financial growth without the extreme stress of entrepreneurship. Instead of burning yourself out trying to run a business, focusing on career development and salary negotiation in a stable, high-paying job might be a more practical and rewarding path to financial success.
5. The Myth of Job Security vs. Business Security
While it is true that job security is not guaranteed, employees who continuously upgrade their skills and stay relevant in their industry significantly reduce their chances of unemployment. A stable career in a high-demand field can provide consistent income, benefits, and long-term financial growth without the risks associated with business ownership.
In contrast, businesses can fail at any time due to factors beyond the owner’s control. Economic downturns, such as the COVID-19 pandemic, forced thousands of businesses to close, leaving many entrepreneurs struggling with debt and financial losses. Additionally, government regulations and policy changes can impose unexpected challenges on business owners, while disruptive technologies may render certain industries obsolete. No matter how hard an entrepreneur works, external circumstances can dramatically impact their business’s survival.
On the other hand, professionals who invest in high-demand skills—such as cybersecurity, artificial intelligence (AI), or digital marketing—can always find new opportunities in the job market. Employers actively seek skilled professionals, and those who continuously develop their expertise can transition into new roles with ease. If financial security is your primary goal, focusing on a stable and growing industry is often a more reliable path than starting a risky business with uncertain outcomes.
6. Alternative Ways to Earn More Money Without Starting a Business
If your main reason for considering entrepreneurship is to increase your income, there are many alternative ways to achieve financial success without taking the risks of starting a business.
Climbing the corporate ladder is one of the most traditional methods of increasing your income over time. By focusing on high-paying industries such as finance, IT, and healthcare, you can build expertise and position yourself for higher-paying roles. Taking on leadership positions or pursuing specialized training can also set you apart from others in your field. Additionally, if you decide to switch jobs, negotiating for a better compensation package is crucial to ensure you’re being paid what you deserve for your skills and experience.
Real estate investment is another way many Malaysians grow their wealth. Buying property, especially in high-demand areas, allows you to rent out homes or apartments, generating steady passive income. Real estate, when managed correctly, can be a reliable source of income without the need for day-to-day involvement in a business. It also has the potential to appreciate in value over time, further increasing your wealth.
Investing in stocks, particularly blue-chip stocks or Real Estate Investment Trusts (REITs), is a popular strategy for generating long-term returns. These investments can offer a good balance of stability and growth, providing both capital appreciation and dividend income. Many companies in Malaysia pay dividends, which offer a consistent stream of passive income, allowing you to benefit financially without actively managing your investments. However, it is important to plan carefully, conduct thorough research, and consult licensed financial professionals before venturing into stock investment, as it carries higher risks.
For those looking to supplement their income, freelancing or starting a side hustle can be a great option. Whether it’s writing, graphic design, or coding, freelancing allows you to earn extra money while still maintaining a full-time job. This flexibility can be a great way to increase your earning potential without giving up the security of your primary salary. Side hustles can eventually evolve into full-time businesses, providing even more income opportunities in the future.
Conclusion
Entrepreneurship is not a guaranteed path to wealth. It requires significant investment, involves high risk, and often comes with stress and unstable income. While some people thrive as entrepreneurs, many find that a well-paying job, smart investments, or freelancing provide better financial security with less risk.
If your main goal is to earn more money, focus on building a high-paying career, making smart investments, and creating additional income streams before taking the leap into business ownership.
Starting a business is a personal decision, but it is important to understand the risks and alternatives before jumping in. Make sure you have a solid financial plan before taking the plunge! If you are facing a temporary financial setback, consider EM Loan for a hassle-free and convenient solution instead of rushing into the tough decision of becoming an entrepreneur.
