Making the leap from employee to entrepreneur isn’t as simple as quitting your job to start a business. There’s so much more involved. While we’ve covered some of these considerations in this publication, it’s worth noting that no single article can fully prepare you for the transition. A lot of what you’ll learn comes from experience, shaped by the unique challenges of your chosen industry.

That said, there’s one critical element that applies universally to anyone making this shift: mental preparation. Employees and entrepreneurs live in vastly different worlds. A stable job offers a sense of security—a steady paycheck, minimal risk, and benefits you can count on. Even if the company you work for fails, your losses are often limited to your job.

Contrast that with entrepreneurship, where you often put everything (time, money, and energy) on the line. The stakes are high, and the odds? Not exactly in your favor.

Approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.

— U.S. Bureau of Labor Statistics

Entrepreneurship comes with financial instability, especially in the early stages. There’s no steady paycheck, and your savings often become your primary funding source. Add to that the pressure on your relationships and the inevitable self-doubt, and it’s clear why mental resilience is crucial.

As Elon Musk bluntly puts it:

Being an entrepreneur is like eating glass and staring into the abyss of death.

To help you prepare mentally for this challenging but rewarding journey, here are three essential tips:

1. Seek Mentorship

A business mentor can be a game-changer when transitioning from employee to entrepreneur. As defined by the U.S. Chamber of Commerce, mentors are experienced industry leaders who guide aspiring entrepreneurs as they grow their businesses.

Mentors help you navigate the uncertainties of entrepreneurship, pointing out potential pitfalls and providing valuable insights you might otherwise overlook. Their experience makes the switch less daunting by preparing you for challenges before they arise. And the best part? You have someone to turn to for advice whenever you’re stuck.

Pick out associates whose behavior is better than yours, and you’ll drift in that direction.

— Warren Buffett

If you don’t already have a mentor, consider attending networking events or industry meetups where you can connect with successful entrepreneurs.

2. Network with Like-Minded Individuals

Networking is another critical step. Industry events provide an excellent opportunity to meet other professionals and exchange ideas. These gatherings often feature successful entrepreneurs and mentors as speakers, giving you the chance to learn from their experiences.

Surrounding yourself with like-minded individuals can also influence your mindset. Being in the company of successful entrepreneurs allows you to absorb their habits, strategies, and perspectives, which can significantly increase your chances of success.

Success isn’t about the end result; it’s about what you learn along the way.

— Vera Wang

Whether it’s through networking events, online communities, or professional organizations, building a strong network is an investment in your future as an entrepreneur.

3. Build a Bulletproof Mind Against Failure

Failure is an inevitable part of entrepreneurship. Even the most well-thought-out plans can go sideways due to factors beyond your control. Accepting this reality doesn’t mean giving up—it means preparing yourself to face setbacks with resilience and learning from them.

Acknowledging the possibility of failure can help you approach it as a learning experience rather than a roadblock. Surrounding yourself with a strong support system—mentors, peers, and like-minded entrepreneurs—can help reinforce this mindset.

Remember, failure isn’t the opposite of success; it’s often a stepping stone to it.

Final Thoughts

Switching from an employee to an entrepreneur is no small feat, but with the right mental preparation, you can face the challenges ahead with confidence. Seek guidance from mentors, build a supportive network, and embrace failure as part of the process.

Entrepreneurship might feel like “staring into the abyss” at times, but for those who persevere, it’s also an opportunity to create something meaningful, impactful, and truly your own.