An entrepreneur is a businessperson who creates and leads a new enterprise. Entrepreneurs are known for their risk-taking, innovation and creativity. They are also known for creating jobs and contributing to economic growth. Entrepreneurs are often found in a variety of industries including agriculture, manufacturing, retail and service.
The term entrepreneur is derived from the French verb, entreprendre, meaning “to undertake.” It was first used in academic literature by an economist in the early 1800s, who identified a willingness to take risks as one of the primary characteristics of entrepreneurs. Other scholars, such as Joseph Schumpeter and Israel Kirzner, refined the academic understanding of entrepreneurship in the 1930s. Despite the many different interpretations of this term, all entrepreneurs share a common desire to develop and grow businesses.
What are the different types of entrepreneurs?
The type of entrepreneur you are will influence how you approach your business. A successful entrepreneur is someone who can see opportunities in unmet needs or market inefficiencies and then act upon them. For example, Jerry Greenfield and Ben Cohen partnered their $8,000 in savings with a loan to lease a Burlington, Vermont gas station, buy equipment and make uniquely flavored ice cream. Their company, Ben & Jerry’s, now brings in millions of dollars per year. This is a classic example of a business that began as an entrepreneurial idea.
Entrepreneurs are sometimes described as visionaries, like Thomas Edison or Steve Jobs, who saw potential for innovative products that could change the world. Others are more opportunistic, seeing the chance to get into financial investments at a good price and then exiting at the right time when the investment reaches its peak value.
In addition to having an innovative product or service, entrepreneurs are often skilled at marketing and networking. They can find customers, attract funding, hire and train employees, and manage a complex supply chain. They are also responsible for planning and executing a successful launch.
Entrepreneurs are typically self-motivated and willing to work long hours to achieve their goals. They are also resourceful and have the ability to adapt quickly in an ever-changing business environment. Many entrepreneurs start small, financing their operations with their own money or funds from friends and family, a scenario known as bootstrapping. Those with the most successful ideas may be able to raise the needed capital through venture capital or angel investors, allowing them to scale up their operations.
However, a key challenge is balancing innovation with reality. It is important for entrepreneurs to design new products that are able to meet customer demand and provide a profitable return on investment. Otherwise, they can run into the “busy fool” problem where they spend too much time pursuing their dreams without enough profit to justify the effort. For more information about the different types of entrepreneurs, download BDC’s free Entrepreneurial Potential Self-Assessment. This tool will help you determine if a career as an entrepreneur might be the right fit for you.