Search:
Recent Posts
Categories
Archives
I own a business so I’m an entrepreneur…right?
I’ve made the case before that the word “entrepreneur” is an abused term misunderstood by most people. I keep coming across people and their blogs who claim to be “entrepreneurs”. In most cases I would beg to differ (but hey, who am I anyway?). I work in a start up and I consult on the side. I would say that neither of those things make me an entrepreneur although my consulting practice is, by definition, a small business. I’m just starting to podcast and expect to soon be paid for doing that podcast. That probably doesn’t make me an entrepreneur. I teach entrepreneurship and that certainly doesn’t make me an entrepreneur.Â
I would say that there have been times in the past when I have been an entrepreneur and I would like to think of myself as an entrepreneur. I certainly think like an entrepreneur - there is an entrepreneurial mind frame that never leaves.
Below are several types of businesses. In your expert opinion, is the owner or founder of the business an entrepreneur or not?
- Dry cleaner with a one store operation that the owner does not intend to expand
- Pre-revenue Internet company building revolutionary search technology that could unseat Google
- Franchise owner (single or multiple operations) Â
- Non-franchised ever expanding gas station and convenience store company
- Podcasting start up
- Management consultant
- Large commercial construction company
- Doctor in private practice
- MLM distributor
- Single mom doing eBay drop shipping for a living
There are a lot of smart people who read this blog. There are a lot of people who claim authority on what entrepreneurship is that read this blog. So what do you think? Tell me who is and who isn’t the entrepreneur and why. Or perhaps your opinion is being an “entrepreneur” has nothing to do with the type of business you own or run but instead its a time frame or some other factor.
Please let me know your thoughts in the comments.
Entrepreneurship is all about taking risks. If the dry cleaner is opening their store in a saturated market, or is taking risks to increase their sales, or the single mom on eBay.
I don’t think it can be defined by number of employees, size, technology or ideal growth: entrepreneurship is about taking risks in your own business.
Left by nick on 02/12/2007Hmmm, good question.
I’ve worked for several start-up companies and, I was on the founding team of one that was acquired by Eli Lilly. Since then, I’ve worked for established companies.
When I was at Amazon, they really, really pushed the fact that everyone is an intrapreneur. In fact, several people (me included) have created innovative products, processes, technologies, and solutions that were and are patent-able at Amazon. That’s the Amazon way — they really push ownership and entrepreneurship. Thoughts on that?
In many ways, your question is a metaphysical question that doesn’t really make its way into the dirt and sweat of everyday life. If we were to follow the pragmatic approach and look towards last things (fruits) instead of first things (axioms or definitions), then the question takes on a whole different flavor.
Whom do you consider an entrepreneur?
What attributes do they have that define their entrepreneurial nature?
How am I like them?
This is the pragmatic approach, looking towards fruits, rather than origins; this approach might get us sooner to “truth” rather than looking towards first things, which typically encourages tail-chasing with no conclusion.
Left by Pete on 02/12/2007@Nick:
Risk is the one factor that will always overshadow entrepreneurship but its not the only factor. Furthermore, entrepreneurship is not about risk - it’s about calculated risk.
I would also add that high risk doesn’t mean high return
Left by Chris Knudsen on 02/12/2007@Pete:
I think intrapreneurship is more about corporate culture and innovation than anything else.
To answer your questions - I’m not sure I know anymore. At this point in my life I think that the purist form of entrepreneurship are the guys who start up original ideas, run them, sell them and start the process over again. However, there are still many holes in this idea as well.
I like your approach to the question.
Left by Chris Knudsen on 02/12/2007@Chris
I think you’re right, but I think it is worth saying that while high risk doesn’t mean high return, low risk rarely results in high return. All calculated, of course.
I decided to ask Google, and I think it came up with something good:
“Innovator. One who recognizes opportunities and organizes resources to take advantage of the opportunity.” from http://www.onlinewbc.gov/docs/starting/glossary.html
Left by nick on 02/12/2007@Nick:
I guess to figure out if that is true you have to define risk.
I’m working with a company now that has developed a really cool product. They have distribution lined up and a very eager untapped market. Basically all they have into it is time. However, the idea is truly amazing (and I don’t say that about ideas that much). I could see this company getting a nine figure exit within 18 months of launch.
If that works out (and its all subjective) they initially had very low investment and risk yet the return (even if its a low eight figure buy out) potential is huge.
So I think there may actually be such a thing as low risk high return.
We’ll see.
Left by Chris Knudsen on 02/12/2007I think most people are actually right in how they classify entrepreneurs. A quick “define:” search on Google shows most sources defining an entrepreneur as “someone who starts a business.” Under that simple, yet common definition, all of your examples could be considered entrepreneurs. I think sometimes we over-analyze the issue when we try to say who is and isn’t an entrepreneur. There are certainly varying levels of innovation and risk depending on the business situation and opportunity.
http://www.google.com/search?q=define:entrepreneur
Rather than simply classify people as entrepreneurs and non-entrepreneurs, to me it makes more sense to say, all business owners and innovators are entrepreneurs, but within the ranks of entrepreneurs, there are various types of entrepreneurs and degrees of entrepreneurship.
Left by Dave Bascom on 02/12/2007@Chris
But how often does that actually happen? I can think of very few. And I guess I am assuming that the cost, and specifically opportunity cost, of time is a big risk. Maybe that is just for me though, because I’m graduating and have nothing to fall back on for income during the time I am taking that risk.
Left by nick on 02/12/2007@Dave:
I like your approach and argument but, with all due respect, I think it might be too simple. Doctors in private practice and MLM distributors all “start a business” but I certainly would not consider them entrepreneurs.
Left by Chris Knudsen on 02/12/2007@Nick:
It doesn’t happen often but neither does the “take a big risk and have a big exit” deal either. Its all very rare.
Left by Chris Knudsen on 02/12/2007Entrepeneurship is a state of mind and a lifestyle issue. If by your actions you create and are responsible for a business entity that generates income, then you are an entrepeneur. The doctor, the MLM mom, the dry cleaner and all the rest are entrepeneurs. Each one of them goes home every night knowing that their business needs them to function. There are no paid holidays or vacation days or sick days. This level of responsibility, of ownership is what makes them entrepeneurs.
Left by Harvey G on 02/12/2007@Harvey:
Thanks for your comments and I like your blog. I think what you describe is a small business owner rather than an entrepreneur. To me, there is a difference. However, I don’t think its appropriate for me to go so far as to say you’re not an entrepreneur. If you believe you are then you are - my opinion doesn’t really matter.
Keep up the good work.
Left by Chris Knudsen on 02/12/2007I think you heard my opinions on it at Barbacoa that one day during lunch. I think defining what an entrpreneur is or isn’t is like high school kids creating some clique and trying to determine who’s a jock and who isn’t. That’s my two cents . . .
@Nick. I only say this so bluntly because I believe it so strongly but the low risk/high risk discussion has nothing to do with returns. Risk isn’t tied to returns. That’s gambling. Knowledge (or the lack thereof) is tied to returns.
That being said, low risk is what actually leads to high returns because when you seek to understand your markets, customers, product, competition, etc. as much as possible, you are minimizing risk to near zero. You want zero risk. Low risk is what leads a business to high returns.
When you take “high risks” without seeking as much knowledge as possible, your nothing more than a gambler.
Left by Russell Page on 02/12/2007Wow. I read my comment and feel like I was harsh. Tail between legs . . . my apologies.
Left by Russell Page on 02/12/2007For me, I will add my thoughts to those of Pete, Russell, Dave, and Harvey who I mostly agree with:
Entrepreneurship has lots of levels. I know that Doba customers that are looking at starting an online store feel just as much fear and risk and hesitation as any entrepreneur. Entrepreneurship is very real for them. Will they create a business worth Billions? No. Millions? Maybe. Change their life? Yes. What they do at the end of the day is the same as what I do: They take risks. They innovate. They create value. They have a shot at rewards. Are their potential rewards as high as mine? Possibly not. Is their risk level as high as mine? Possibly more. To not call that person, or most others on your example list, entrepreneurs is disingenuous. (I’ll give you the MLM deal, they’re just chasing wealth, not trying to create real value, they are NOT entrepreneurs). For most of the rest they’re living entrepreneurship, whether anyone else thinks it or not. They’re most likely not serial entrepreneurs. They are are their own level of entrepreneurship, and there are almost infinite levels. And like Russell said, does drawing the line of who is an entrepreneur who is not really accomplish anything? (it’s an interesting discussion nonetheless) That’s my $0.02, and my thoughts on this have changed over time (I was much more limited in my view), mainly from my experiences as an entrepreneur starting a technology company that provides services to other entrepreneurs—I see both sides.
P.S – for employees, I agree with Pete, you can be an intraprenuer (or some other term) that embodies the spirit of ownership of problems and innovation, but you are not an entrepreneur. If you were, you’d quite your job, sign up for Doba, and head into the unknown to create your fortune online.
Left by Jeremy on 02/13/2007@Jeremy:
“To not call that person, or most others on your example list, entrepreneurs is disingenuous.”
Who is saying they aren’t entrepreneurs? The only people I hinted to having any feelings of not being an entrepreneur were doctors and MLM’ers. It looks like you agree with that.
You exclude people in MLM’s (and so did I) but aren’t they taking risks? You say they are “chasing wealth” - no one else on that list is chasing wealth? How do you define “creating real value”?
You say there are “almost infinite levels” of entrepreneurship. MLM’s don’t fit in one of those levels? Wouldn’t an intrapreneur fit in at some level of entrepreneurship?
Left by Chris Knudsen on 02/13/2007Chris,
I am glad you post the question because it is something I have be wrestling with mentally for the last couple of weeks. A large percentage of my clients are start-ups or companies who are still run by their founders. Most I would consider entreprenuers. The question also interests me because I have started two law firms. One as one of four founders which grew to 10 employees and the other, that has gone from just me to 7 employees. Am I a small business owner, entreprenuer or both?
I posed your questions to 5 people at my firm. The answers were unanimous on 1. N, 2Y, 3. N, 4.-5. Y 9. N. The rest were a mixed bag. When asked why - each indicated that an entreprenuer should start rather then buy the business, and show creativity either in product, service or how the product or service is delivered.
The only reason any of this matters is that entreprenuer sound sexier than small business owner. In the long run, the only important longterm questions are 1) are you supporting yourself/family, 2) are you helping other people support themselves/their families, and 3) are you providing some value add to your customers and the business community in general.
Once you solve this question, you can help me explain to my employees what I mean when I tell them I want them to be entreprenuerial.
Left by Rand on 02/13/2007@Rand
“Once you solve this question, you can help me explain to my employees what I mean when I tell them I want them to be entrepreneurial.”
That is the best statement I have seen here and it perfectly illustrates the dilemma. I am starting to think its more a state of mind rather than what you do.
You’re an attorney? Good job and great comments!
Left by Chris Knudsen on 02/13/2007A successful independent contractor does not an entrepreneur make. Nor does someone who wants to be viewed as an “entrepreneur” by his/her peers.
Left by Blake Snow on 02/13/2007Blake:
You’re speaking Yoda on us. I’d like to hear more.
Left by Chris Knudsen on 02/13/2007“a person who organizes and manages any enterprise, esp. a business, usually with considerable initiative and risk.”
Entrepreneur
###############
2. Pre-revenue Internet company building revolutionary search technology that could unseat Google
5. Podcasting start up
6. Management consultant
10. Single mom doing eBay drop shipping for a living
Non-Entrepreneur
###############
1. Dry cleaner with a one store operation that the owner does not intend to expand
3. Franchise owner (single or multiple operations)
7. Large commercial construction company
8. Doctor in private practice
4. Non-franchised ever expanding gas station and convenience store company
Dishonest Scumbags
Left by Ryan Byrd on 02/13/2007###############
9. MLM distributor
@Ryan
I don’t think the MLM is the dishonest scumbag. In most cases the MLM distributors are very honest and nice people. They are usually only guilty of believing the lies told to them by their upline. It’s the founders of shady MLM schemes that really know what’s going on. They’re the real scumbags.
Left by Dave Bascom on 02/14/2007@Ryan
I also don’t agree that MLM’ers are dishonest scumbags. They’re just a little misguided.
Left by Chris Knudsen on 02/14/2007[...] Here’s a strange idea - listening also applies to reading. How often do we read into something that’s not really there? We often read something, misinterpret what was written and then make false assumptions about the author or his position. This happens to me all the time on my blog. Read this post then read the comments and, if you’re attentive, you will see people trying to interpret my position and then make comments about an assumed position that is never really given. Now, this could mean that I need to do a better job explaining myself or it could mean that sometimes we need to slow down and really ”listen” to the words on the page in front of us. [...]
Left by Chris Knudsen on life, business, and entrepreneurship » “Listening” to what we read on 02/16/2007