The term, entrepreneur has become overused. These days, almost everyone running their own businesses call themselves entrepreneurs.
Those who look to describe people who own their own enterprise will use entrepreneur and small business owner interchangeably.
In case you didn’t know, just because you run your own business doesn’t mean you are an entrepreneur.
Each phrase describes a different kind of person, and distinctive mind-sets about how they pursue their business.
In an article for Forbes, small business owner Gene Marks succinctly writes of his rejecting the entrepreneur label, and taking pride in the smallness of his business: “I am not a risk taker. I am not a dreamer. When I make an investment in a new product or technology it’s one that I’m able to lose without feeling it. My gambles are small. I think small. Therefore my returns are small. I am a business owner. I am a small business owner. And I’m fine with that.”
These characteristics highlighted by Gene Marks are the key differences between small business owners and entrepreneurs.
They are further explained below.
Read through, and let’s know which of the labels perfectly fits you.
Idea
Businessmen can make a business out of an unoriginal business or product idea. They enter into existing businesses, such as franchising and retailing. They choose a hot and profitable business idea regardless of whether it is their original idea or borrowed from someone else.
Entrepreneurs on the other hand are inventors and the first creators of a product. They come up with ideas that haven’t been tested, diagnosed, or worked through, and invests time, energy and money on it. A lot of times they don’t even know if their ideas are possible, which gets them even more excited.
Purpose
Most businessmen are doing business for profit, livelihood, for reaching their financial goals, and for becoming their own boss. Though, there are some business people who are not profit-oriented but people-oriented, that is, they are more concerned on the welfare of their workers and the satisfaction of their customers.
Entrepreneurs are more concerned on changing the world. They want to pursue their passion and achieve an ultimate goal. They are not keen on financial returns, rather they are focused on what they can offer to the world. Their purpose for entrepreneurship is simply to make a difference in this world.
Risks
The ability to stomach risk is a critical characteristic of the entrepreneur. They gain pleasure in pursuing gambles with higher chances of failure, with larger rewards that come with that risk being the motivation they need to pursue those options.
Small business owners would be better characterised as being risk averse. When faced with the choice between two options – a higher reward payoff that’s less likely, and a lower reward payoff that’s more likely – they will choose the safe option.
So, which of the categories do you belong? Are you an entrepreneur or a small business owner?
