Entrepreneurship is the in thing. Recently everyone is an entrepreneur. Starting a business? You’re an entrepreneur. Buying a business, you’re also an entrepreneur. Selling a product from another company where you have zero ownership or input, marketers also consider you an entrepreneur. Have you recently been downsized from a company and unable to find work? Entrepreneur. You get the idea. Personally I do not believe that everyone is an entrepreneur. There may be some confusion between the terms income, business, and entrepreneurship.
Income is money flowing to you, your household or your business. It can come from a variety of sources such as a job, a newly created or acquired business, or from an investment. On the other hand, a business rules out employment as a source of income, and is money received from a newly created or acquired entity. I would argue that some businesses are created and managed by entrepreneurs, while other businesses were at one time created by an entrepreneur, but may now be operated by a manager.
This brings us to entrepreneurship. There are at least a few items that make an entrepreneur unique:
1. Problem Solving: The ability to identify and overcome challenges quickly.
2. Value Creation: The ability to create value from nothing.
3. Means of Survival: The willingness and ability to live solely off the income from their newly created business or businesses.
4. Independent: Not well suited for employment.
5. Passion: Lack focus, but not persistence.
6. Optimistic: Impulsive and compulsive.
7. Choice: Willingly engages in entrepreneurship.
I will address each of the following in greater detail.
Above all, entrepreneurs are superb problem solvers. They are quite skilled at identifying a problem within their current life experience (either personal or professional) and devising a solution to assist them with overcoming the problem and expediting their workflow. Most times this is not motivated by money, and resulting businesses or products are generally a by-product of a solution created to assist the entrepreneur with making their life easier. The creation and building of a business is simply the identification and solution of successive challenges. Entrepreneurs solve problems as simply as many individuals perform routine tasks.
True entrepreneurs have a knack for creating something from nothing. They are fountains of ideas, and not only have the ideas but are able to execute these ideas (or at least some of them) successfully. An entrepreneur may not be able to successfully scale a business or idea on their own, but they are skilled at taking a blank piece of paper or screen, creating an idea, and building a repeatable business model around it, even at small scale. I have personally experienced repeatable business ventures being launched from idea formation to first revenue in as little as two days.
In my mind value creation is one of the key differentiators between entrepreneurs and business owners or managers. Skilled entrepreneurs have the ability to create revenue from nothing, the majority of business owners or managers do not. This is not to downplay the skills required to own and operate a business, they are just different from the skills and traits needed to successfully start and launch a business. Value creation is what separates the wheat from the chaff in terms of entrepreneurship.
Means of Survival
Given the choice between a comfortable salaried position and an uncertain, risky, and uncomfortable new venture, the entrepreneur will choose the new venture every time. The entrepreneur not only has the ability to survive off their own creations, but prefers to do so even when offered potentially less risky, comfortable alternatives. The rationale behind this choice is that entrepreneurs enjoy the process of creation and the subsequent generation of income resulting from these activities. More importantly, entrepreneurs place a premium on independence and will not usually trade independence for comfort. One possible exception may be in the instance of receiving an opportunity to work alongside or under a respected entrepreneur with greater experience or skill than the entrepreneur in question within their shared field. Even then, this decision is not motivated by income, but instead by experience.
The survival aspect of entrepreneurship rules out “forced entrepreneurship” as entrepreneurship. This is not to say that a forced entrepreneur cannot evolve into a true entrepreneur, but the very act of being dislocated from employment and forced into a new venture does not make an employee an entrepreneur. Entrepreneurs survive and prosper off the income of their creations.
Because the entrepreneur places a high value on independence and the creative process, they often make poor employees. This is not to say that entrepreneurs perform work tasks poorly, quite the opposite; it is that they are unable to take orders or direction from others, at least over prolonged periods of time. Because entrepreneurs are accustomed to creating their own income and business, and operating at the front of an organization, they tend to not wait around for the direction or approval of others. Given the knack for problem solving and creative ability inherent to entrepreneurship, they generally do not need the direction or approval of others as required by many employees. This entrepreneurial trait can make it very frustrating for a non-entrepreneur to manage the activities of an entrepreneur and the relationship will not likely last for long. In fact, entrepreneurs will often rebel at any indication of direct control.
This is not to suggest that entrepreneurs do not have jobs. There are situations where entrepreneurs are serving as employees. However, these employment relationships generally do not last long and the entrepreneur may just enter such an arrangement as a means of overcoming a short term crisis when no other alternative is available. As a result, entrepreneurs are better suited for gigs or independent consultant type arrangements with a fixed duration.
Entrepreneurs generally do not make good team players. Because of their independent nature and inclination to drive activities ahead without approval or guidance from others, they generally tend to prefer operating on their own. Entrepreneurs do join and participate in teams and other group activities, but it is rare. Entrepreneurs generally will only team together with others should the other potential team members bring a complementary capability (skills, relationships, or resources) to the table, and if their personalities gel. Entrepreneurs will not join a team simply for the sake of joining as is typical of many others outside of entrepreneurship. Entrepreneurs are builders, not joiners.
Entrepreneurs are passionate individuals. This passion fuels the energy required to overcome gravity in the early days of an idea. Passion enables the entrepreneur to create something new from nothing, launch the idea into a product, monetize the launched product, and overcome the successive challenges they will undoubtedly encounter along the way. This can be a long and arduous process which will result in despair at times. Sufficient passion provides the momentum necessary to push on through to the other side of the trough of despair to the light of success.
Hand-in-hand with passion is a lack of focus typical of entrepreneurs. Entrepreneurs enjoy the act or creating, or starting things. Once one stream of income is up and running, it is time to start another, and another, and another. Entrepreneurs enjoy focusing on a passionate idea, but equally enjoy the thrill of launching a new idea. Passion fuels progress.
Entrepreneurs are impulsive, yet compulsive. From the perspective of the entrepreneur, every idea is a great idea and chances of failure are slim to none. Failure is not an option, at least not show stopping failure. Coupled with the impulsiveness of the entrepreneur is the near single-mindedness of seeing an idea through to completion. From idea, though launch, and with each successive challenge, the entrepreneur is overly optimistic at the continued success of their venture. Entrepreneurs are passionate optimists.
In the end it all boils down to choice. The entrepreneur chooses to be an entrepreneur. They choose to create. They choose to survive off the fruits of their ideas – whether those ideas are profitable or not. They are lone wolves by nature and do not often defer to others. They have a seemingly inexhaustible passion for their pursuits with a brilliant optimism throughout their activities. An entrepreneur is an entrepreneur by choice.
These aspects are, in my opinion, what it truly means to be an entrepreneur. Those who walk down this path are entrepreneurs and live the entrepreneurial lifestyle.