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What Is an Entrepreneur?
An entrepreneur is an individual who creates a new business, bearing most of the risks and enjoying most of the rewards. The process of setting up a business is known as entrepreneurship. The entrepreneur is commonly seen as an innovator, a source of new ideas, goods, services, and business/or procedures.
Entrepreneurs play a key role in any economy, using the skills and initiative necessary to anticipate needs and bring good new ideas to market. Entrepreneurship that proves to be successful in taking on the risks of creating a startup is rewarded with profits, fame, and continued growth opportunities. Entrepreneurship that fails results in losses and less prevalence in the markets for those involved.
The word entrepreneurship is a general term that can mean a lot of things to different people. This is why I have decided to write on this topic ‘What type of a person is an entrepreneur?‘ to enlighten my readers on who an entrepreneur is, what type of entrepreneur you might be, what qualifies you to be an entrepreneur and the functions/roles of an entrepreneur.
An entrepreneur is generally defined as an individual who organizes or operates a business or businesses.
Here is my elaborate definition:
An entrepreneur is an individual who sets up business or businesses, identifies and solves problems, is creative, innovative, opportunist, risk-taker, self-starter, and open-minded with the hope of making a profit from the enterprise.
The major types of entrepreneurs include; social entrepreneurs, serial entrepreneurs, and lifestyle entrepreneurs.
1. Social Entrepreneur
This is an individual who pursues innovative solutions to social problems. A social entrepreneur adopts a style of which he/she can use to create and sustain social values. Most social entrepreneurs engage in non-profit activities and are overwhelmed by social responsibilities and conscience. They are primarily motivated to improve socio-economic well-being, educational, health, fundamental, environmental, and health conditions of others.
The goal of social entrepreneurship is to create a benefit to society and humankind. They focus on helping communities or the environment through their products and services. They are not driven by profits but rather by helping the world around them.
2. Serial Entrepreneur
This is an individual who CONTINUOUSLY comes up with new ideas, start the business and often times sell to investors or shareholders. Serial entrepreneurs start-up several businesses with little intention to operate any of them for a long time. They are high-risk-takers with lots of unique ideas and are not always interested in a career with a particular business/company. 10 top serial entrepreneurs according to Forbes include Craig McCaw, Josh Kopelman, Steve Blank, Wayne Huizenga, Michael Rubin, The Samwer brothers, Lyndon Rive, Omar Hamoui, Niklas Zennstrom and Janus Friis the Skype pair, Andy Bechtolsheim.
This is an individual who creates profit from personal passion. He/she put their lifestyle ahead of every opportunity. While most entrepreneurs are motivated to build a business to a certain stage and sell to shareholders or investors, the lifestyle entrepreneur chooses to build a business they are passionate about and grow the business into a long term, residual income that is sustainable. Most lifestyle entrepreneurs are completely self-employed; this is to allow them time to set up their projects. In a nutshell, a lifestyle entrepreneur is an addict of whatever they find themselves doing, they do it so well, commit their time, resources and energy to see their project completed. Examples of a lifestyle entrepreneur according to eCommerce rules include; Tim Ferriss, Pat Flynn, and Chris Guillebeau.
A person who buys the products from someone else then sells them directly to the customers is known as a trading entrepreneur.
It plays the role of middle man as it does not manufacture anything, and he does not have his factory. He takes 100% of finished items from factories and sells them to the customer who comes to his shop.
Such an entrepreneur is also known as the dealer, relater, middleman, and wholesaler between trader and manufacturers.
A person who prepares items from raw materials is known as a manufacturing entrepreneur.
First, he goes to the market and surveys or sometimes gets the previous study’s report. Then he goes for things which are high in demand nowadays.
Once he has decided everything he will prepare in his factories, he starts gathering raw material. Similarly, he imports heavy machinery. In the last, he sets up a factory and hires some workers.
Then workers start working and prepare demanded products from the raw material and sale theme to the wholesaler. Thus, they do not have direct relations with customers.
If a person has a tiny business and there are only a few members that are helping him in running it, he is known as a small business entrepreneur
Such person does not aim for big houses, cars and an elite lifestyle instead they work to earn bread and butter. So, they can afford the expense of their children’s education and give them a modest lifestyle.
Such small businesses are very common, for example, clothes shops, shoe shops, hairdressers, and small grocery shops. All these are an entrepreneur, but they are working at a small level.
A person which company is working on a considerable level and earning a high amount of profit is known as a large company entrepreneur.
Such companies have a set of rules and regulations for hiring people; thus, before hiring anybody, they take his interview and make sure he is eligible for this job.
Thus there is a team of professionals that is working. They keep increasing the revenue of the company by bringing innovative things and ideas. Such companies make excellent strategies and do next-level marketing.
Such company owners are very ambitious, and they do not work only in one cycle. Instead, they have big dreams, and they work hard to achieve them. Any small company having an ambitious owner can become a large business.
A person whose aim is not to earn money but is also very passionate about bringing new things that can make the lifestyle of humans better is known as an innovative entrepreneur.
They always discuss different ideas with their teammates and think about how they can better use the technology, how natural resources can be saved
You must have seen that solar panels are now manufactured on a large scale to use solar energy to the fullest. Similarly, entrepreneurs are investing a large amount of money to see if there is any planet where life is possible.
For example, Microsoft and Amazon were small, but now they are working on a very large scale.
People who do not have enough capital but start from a small business and work hard to make it a large company are known as hustler entrepreneurs.
Such persons are very hardworking, strong, and brave. They do not have fear of anything, and they are always ready to face difficult situations. Moreover, they work day in and day out.
Their complex works help them grow the business, and one day, they are counted as prominent business entrepreneurs. Thus, it is not necessary only a wealthy man can be a well-known company entrepreneur.
Any ordinary but hard-working, courageous man having an ambitious and innovative mindset be a prominent businessman.
A person who uses other people’s ideas as essential then tries to make them better is known as an imitator entrepreneur.
Such people are brilliant as they do not work hard, but they learn from others’ mistakes and run their business successfully without specific innovations.
So if you want to stand somewhere between hustle and innovator, be a hustler, and you will not have to invest a significant amount of time. Moreover, there are almost no chances of loss in such businesses.
A person who buys a pre-established business is known as a buyer entrepreneur.
For buying a business, you must have a large amount of money. Once you buy a business, you can change the management or company’s working structure.
Similarly, you can introduce new strategies for the betterment of weak areas of business.
Such businesses are not risky because you bought successfully and established businesses and do not even have to work very hard. But if you do not have leadership qualities, you will lose the company soon.
A person who researches a lot before investing money in any business is known as a researcher entrepreneur.
Such people are not hasty, but they work with proper planning and spend a lot of time researching the product they will launch and making sure they will benefit from it.
Similarly, they take sessions and research everything about a business owner and try their best to know all qualities of a successful businessman.
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13. Internet Entrepreneur
An internet entrepreneur is essentially someone who operates their businesses online. Compared to traditional business owners that require huge capitals, shop houses, ready-made products, and staff management, online entrepreneurs seem to have an inherent advantage when it comes to business management and start-up costs.
However, an entrepreneur doesn’t necessarily take on a greater than normal financial risks in order to do so, especially in the age of internet. Online opportunities are aplenty.
More often than not, depending on a a single day job for income is more risky than becoming an online entrepreneur.
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14. Cryptopreneur
The word Cryptopreneur is derived from cryptocurrency and entrepreneur. In other words, cryptopreneur means crypto investor. A cryptopreneur is a person, group of people, or organizations, who believes in the cryptocurrency revolution blowing around the world and thereby taking advantage of the investment opportunity it offers as a means of creating more wealth.
So you have got the answer of what are the 14 types of entrepreneurs
Qualities of an Entrepreneur
To be an Entrepreneur, you must possess most of these qualities;
“An entrepreneur is an individual who sets up business or businesses, identifies and solves problems, creative, innovative, opportunist, risk-taker, self-starter, and open-minded with the hope of making a profit from the enterprise”. – Francis Nwokike (Founder, The Total Entrepreneurs)
After retiring her professional dancing shoes, Judi Sheppard Missett became an entrepreneur by teaching a dance class to civilians in order to earn some extra cash. But she soon learned that women who came to her studio were less interested in learning precise steps than they were in losing weight and toning up. Sheppard Missett then trained instructors to teach her routines to the masses, and Jazzercise was born. A franchise deal followed. Today, the company has more than 8,300 locations worldwide.3
Following an ice cream making correspondence course, two entrepreneurs, Jerry Greenfield and Ben Cohen paired $8,000 in savings with a $4,000 loan, leased a Burlington, Vt., gas station, and purchased equipment to create uniquely flavored ice cream for the local market.4 Today, Ben & Jerry’s hauls in millions in annual revenue.
Although the self-made person has always been a popular figure in American society, entrepreneurship has gotten greatly romanticized in the last few decades. In the 21st century, the example of Internet companies like Alphabet, formerly Google (GOOG), and Meta (META), formerly Facebook, both of which have made their founders wildly wealthy, have made people enamored with the idea of becoming entrepreneurs.
Unlike traditional professions, where there is often a defined path to follow, the road to entrepreneurship is mystifying to most. What works for one entrepreneur might not work for the next and vice versa. That said, there are seven general steps that most, if not all, successful entrepreneurs have followed:
This first step is not a strict requirement but is definitely recommended. While entrepreneurs have built successful businesses while being less than financially flush (think of Facebook, now Meta, founder Mark Zuckerberg as a college student), starting out with an adequate cash supply and ensuring ongoing funding can only help an aspiring entrepreneur, increasing their personal runway and giving them more time to work on building a successful business, rather than worrying about making quick money.
Once a person has strong finances, it is important to build a diverse set of skills and then apply those skills in the real world. The beauty of step two is it can be done concurrently with step one.
Building a skill set can be achieved through learning and trying new tasks in real-world settings. For example, if an aspiring entrepreneur has a background in finance, they can move into a sales role at their existing company to learn the soft skills necessary to be successful. Once a diverse skill set is built, it gives an entrepreneur a toolkit that they can rely on when they are faced with the inevitability of tough situations.
Much has been discussed about whether going to college is necessary to become a successful entrepreneur. Many famous entrepreneurs are famous for having dropped out of college: Steve Jobs, Mark Zuckerberg, and Larry Ellison, to name a few.
Though going to college isn't necessary to build a successful business, it can teach young individuals a lot about the world in many other ways. And these famous college dropouts are the exception rather than the norm. College may not be for everyone and the choice is personal, but it is something to think about, especially with the high price tag of a college education in the U.S.
It is not true that majoring in entrepreneurship is necessary to start a business. People that have built successful businesses have majored in many different subjects and doing so can open your eyes to a different way of thinking that can help you in establishing your business.
As important as building a diverse skill set is, the need to consume a diverse array of content is equally so. This content can be in the form of podcasts, books, articles, or lectures. The important thing is that the content, no matter the channel, should be varied in what it covers. An aspiring entrepreneur should always familiarize themself with the world around them so they can look at industries with a fresh perspective, giving them the ability to build a business around a specific sector.
Through the consumption of content across multiple channels, an aspiring entrepreneur is able to identify various problems to solve. One business adage dictates that a company's product or service needs to solve a specific pain point; either for another business or for a consumer group. Through the identification of a problem, an aspiring entrepreneur is able to build a business around solving that problem.
It is important to combine steps three and four so it is possible to identify a problem to solve by looking at various industries as an outsider. This often provides an aspiring entrepreneur with the ability to see a problem others might not.
Successful startups solve a specific pain point for other companies or for the public. This is known as "adding value within the problem." Only through adding value to a specific problem or pain point does an entrepreneur become successful.
Say, for example, you identify the process for making a dentist appointment is complicated for patients, and dentists are losing customers as a result. The value could be to build an online appointment system that makes it easier to book appointments.
Most entrepreneurs can't do it alone. The business world is a cutthroat one and getting any help you can will always help and reduce the time it takes to achieve a successful business. Networking is critical for any new entrepreneur. Meeting the right people that can introduce you to contacts in your industry, such as the right suppliers, financiers, and even mentors can be the difference between success and failure.
Attending conferences, emailing and calling people in the industry, speaking to your cousin's friend's brother who is in a similar business, will help you get out into the world and discover people that can guide you. Once you have your foot in the door with the right people, conducting a business becomes a lot easier.
Every entrepreneur needs to be a leader within their company. Simply doing the day-to-day requirements will not lead to success. A leader needs to work hard, motivate, and inspire their employees to reach their best potential, which will lead to the success of the company.
Look at some of the greatest and most successful companies; all of them have had great leaders. Apple and Steve Jobs, Bill Gates and Microsoft, Bob Iger and Disney, and so on. Study these people and read their books to see how to be a great leader and become the leader that your employees can follow by the example you set.
Given the riskiness of a new venture, the acquisition of capital funding is particularly challenging, and many entrepreneurs deal with it via bootstrapping: financing a business using methods such as using their own money, providing sweat equity to reduce labor costs, minimizing inventory, and factoring receivables.
While some entrepreneurs are lone players struggling to get small businesses off the ground on a shoestring, others take on partners armed with greater access to capital and other resources. In these situations, new firms may acquire financing from venture capitalists, angel investors, hedge funds, crowdfunding, or through more traditional sources such as bank loans.
A person is counted in a particular category of entrepreneurship based on the approach he uses for business. For example, if a person thinks about innovative business ideas, he is an innovative entrepreneur.
Similarly, if you are doing business on a small scale, you are a small business entrepreneur. All types of businessmen are working best and have their unique qualities.
Thus, by understanding what are the 14 types of entrepreneurs, you can assess your skills and find out what kind of business you will start.
Andries van Tonder
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Serial Entrepreneur/investor since 2013.
South Africa.
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