What Makes You an Entrepreneur?

08 Mar What Makes You an Entrepreneur?

Entrepreneurship is an attitude more than a skill or a profession.

The term “entrepreneur” is thrown around a lot so let’s start by defining it so we’re on the same page. The American Heritage Dictionary defines an entrepreneur to be “a person who organizes, operates, and assumes the risk for business ventures.” In other words, it’s the process of creating or seizing an opportunity, and pursuing it even though there is a risk.

The goals of entrepreneurs may vary but two of the most common are 1. The desire to build or create something out of nothing, and 2. Financial freedom.

Entrepreneurs have a different perspective on things. They want to create something. They seek out opportunities. They watch for “change” or how to improve something. And most importantly, they want to finally be in control of their futures.

To be successful, an entrepreneur understands that they need to be logical and not fall in love with an idea but pursue it only if it’s deemed viable and marketable with a good chance of success. After all, ideas are just that — ideas — until you decide to take action on them.

Here are some common questions I get about what makes an entrepreneur:

Is everyone who runs a business an entrepreneur?

Many may not consider the newspaper carrier, shoeshine person, or grass cutter, entrepreneurs, though these are often early pursuits of those with an entrepreneurial bent.

Does it matter whether the business is part-time?

Some part-time activities are basically hobbies, or undertaken to supplement income and that’s fine. However, planning for growth is what makes an entrepreneur different.

Your path might begin by earning a salary in the business you want to enter, while learning more about it. This time can be used to develop a support network, professional and personal, and generating ideas to “bounce off” people you respect.

At what point does self-employment become a venture?

The primary objective of many self-employed people is merely to employ themselves (and others if necessary) at a moderate to good salary; some are even willing to eke out a living to do what they enjoy. This approach is often referred to as a “lifestyle” business, and is generally accompanied by little, if any, plan for growth.

Would you consider a person who inherits a business an entrepreneur?

From the point of inheritance on, it is their own money and financial security at risk. They could possibly sell the business, invest the proceeds in blue-chip stocks, and live off dividends. Some might consider managing a personal stock portfolio for a living as an entrepreneurial venture.

Would a person who inherited a small or marginal business, then took it to new dimensions be considered an entrepreneur? The inheritor could have tried merely to keep it going, or even to pace the business’ decline to just carry them to retirement. In a family-held business, long-term success is often a central goal.

Are franchise owners entrepreneurs?

Franchises are generally sure things. For many, operating a franchise is an entrepreneurial effort that comes with built in support. That support can make the difference, for many entrepreneurs, in their chances for long term success, eliminating quite a few of the obstacles and hurdles faced by those that decide to “go it alone.”

These questions are intended, not to develop a precise definition of entrepreneurship, but to help us understand our attitude toward its many forms of expression. You may answer them differently. It all depends on what your entrepreneurial attitude is.

Okay, your turn. Tell us your thoughts on these questions (and my answers) below in the comments.

8 Comments
  • Kathleen Deggelman
    Posted at 15:17h, 14 March Reply

    Great post, Loral. You make a great distinction:

    “Some part-time activities are basically hobbies, or undertaken to supplement income and that’s fine. However, planning for growth is what makes an entrepreneur different.”

    This is something I see a lot in my industry, network marketing. You can definitely make some money on the side by dabbling and earn your product for free, if that’s what you want. The people who achieve the top ranks and make millions, though, are those who recognize the opportunity for massive leverage, and go for that!

  • Harmen Stevens
    Posted at 09:31h, 18 April Reply

    In the Netherlands, just north of where I live, people have defined the difference between an entrepreneur and a self-employed person by the number of personnel they have hired.
    I do understand where this idea comes from, but then what about people like me who like to hire out to self-employed people instead of paying up to 75% taxes on top of the wages we would pay our employees?
    Loral has a point on self-employed people with little or no plan for growth. Lacking a certain skill – we might call ‘entrepreneurship’ – will likely hold back the growth of a business in any country.
    Here’s my question: can you still be merely seeing yourself as self-employed when you have a team to run? Wouldn’t this be detrimental for the loyalty employees have for their bosses?

  • Juan sanchez
    Posted at 17:28h, 20 April Reply

    These are some very good points to ponder,I think that what Loral is trying to say is that it depends on the amount of effort that one puts into what we do to make money whether it is a hobby or a bussiness venture.

  • Kenneth Gill
    Posted at 13:52h, 22 April Reply

    “The American Heritage Dictionary defines an entrepreneur to be “a person who organizes, operates, and assumes the risk for business ventures.” In other words, it’s the process of creating or seizing an opportunity, and pursuing it even though there is a risk.” This definition sits very well with my understanding of an entrepreneur. So if it is a hobby or otherwise, once you begin to pursue it for reasons of making money or profit it now becomes a business venture. Great article.

  • Michael Medina
    Posted at 21:55h, 22 April Reply

    is it a good idea to be self-employed. being that there is little room for growth. or what mind set should one have if the fastest path to cash for now seems to be self employment.

  • Gary Barr
    Posted at 17:24h, 25 April Reply

    This clarification of entrepreneurship was very interesting and encouraging in my ultimate goal of changing my conditioning and looking at building my wealth so that I am not putting all my efforts into a company that is in the long run not going to take care of me. I have woke up after losing my job with Airborne Express since we depended on DHL to provide a future for all of us but in the end destroyed our limited future. I am excited about going forward for me and not others. I am struggling currently with brainstorming for a cash machine entity with most of my skill sets being people oriented and in the operations managment arena. Any suggestions on steps to determine how to select a good solid cash machine business?

  • Mynders Glover
    Posted at 09:31h, 03 May Reply

    Great insights in this post. I can’t help but reflect back on times in which getting my cash machine profitable had been a real mental challenge. And, never did it occur to me to quit and find a real “J.O.B.” Being n entrepreneur is that place where you stick with it and keep working on another approach until it works.

  • Enowr
    Posted at 17:47h, 13 May Reply

    Interesting…Good for you I have learned somewhat more.Thanks

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