The Definition of an Entrepreneur (and How to Become One)

If you’ve ever been unhappy at a job working for someone else, chances are you have probably at one point thought about going into business for yourself. If that’s the case, you may have heard the word “entrepreneur” before. 

Since the entire purpose of this site is to talk about all-things-entrepreneurship, I figured it’d be a good idea to start by establishing a baseline definition for the word when it is used across content on this site. 

What is the Definition of an Entrepreneur?

There is no one-size-fits-all answer to this question, as the definition of an entrepreneur can vary widely, depending on who you ask. However, as a general definition, most people would probably agree that entrepreneurs are people who start, manage, and take on the risks of running a business as a way to fill some kind of need or solve a problem that business owners or consumers have.

While that may adequately describe the “mechanics” of being an entrepreneur, there’s definitely more to it.

As individuals, entrepreneurs often share certain key characteristics, such as creativity, being extremely passionate about their work, having a strong work ethic, and having an ability to see opportunities in situations where others may only see risks.

Here at Entrepreneur for More, we’ll define entrepreneur using a combination of the two parts.

For the purposes of this website: 

  • An entrepreneur is defined as a creative, passionate, and dedicated individual who sees the opportunities contained within challenges and takes on the risks of running a business to fill a need or solve a business or consumer problem. 

Why Do People Become Entrepreneurs?

Good question! People become entrepreneurs for a variety of reasons. Some people become entrepreneurs because they want more freedom in their lives, while others want to make an impact on society. Often, people become entrepreneurs because they need to make money and don’t want to deal with the constraints of a 9-5 job.

Entrepreneurship can be a great option for those who need flexible hours or are frustrated with the corporate environment and want to succeed on their own terms. 

Many people with health challenges have found entrepreneurship to be a great option for them because it allows them to work when they are able to. 

Small Business vs. Entrepreneur: Is There a Difference?

There is often some confusion between defining a small business and an entrepreneur. Yes, the two are related, but they aren’t the same thing. 

A small business is referring to the business itself. You can set your business up as a sole proprietorship, a partnership, a corporation, or other legal structure, but what officially defines you as a “small” business varies based on your industry, your number of employees, and your average annual revenue. The U.S. Department of State has a helpful article that can explain a bit more here: https://www.state.gov/what-is-a-small-business/

An entrepreneur, on the other hand, often refers specifically to the individual person that has an idea and takes steps to execute on that idea, usually to disrupt the current market with a new product or service.

What you end up doing on your entrepreneurship journey is really going to depend on YOUR goals. 

Do you want to start and run your business for the foreseeable future, or, do you want to start a business (or multiple businesses) with the end goal of being able to scale up and potentially sell for profit? 

For example, you may want to take the road of small business entrepreneurship, which involves opening a business without planning to turn it into a large conglomerate or open a series of chains. Or, you may want to pursue large company entrepreneurship, which is where you start and run one or more large companies. 

These are all things to consider as you get on your way. 

What are the Characteristics of an Entrepreneur?

Being an entrepreneur is not easy. Full stop.

Entrepreneurship involves a lot of hard work, dedication, and risk. But, if you have the right mindset and attitude, anyone can become an entrepreneur.

Not sure if you’re ready to be an entrepreneur? Here are 6 key characteristics that entrepreneurs need to possess:

  1. First and foremost, entrepreneurs need to be able to evaluate risks and make calculated decisions. This is especially important when starting a new venture. As with any new undertaking, the risk of failure is high, but so is the potential for success.
    • This may sound scarier than it actually is! If you are good at making pro and con lists and can make a decision based on that information, you’ve already got this skill.
  2. Second, entrepreneurs must have a clear vision for what they want to achieve and how they plan on achieving it.
    • The word “and” here is critically important. Yes, you have to know exactly what you want or where you are going. However, your vision remains a vision unless you have a PLAN for how you’re going to get there. Think of it like taking a road trip somewhere you’ve always wanted to go, but without a map. Do you think you’ll get there? Maybe… but probably not in the most effective or direct way.
  3. Third, entrepreneurs must be passionate about their idea in order to turn it into reality.
    • Ask yourself: what is the WHY behind what you want to do? If it doesn’t excite or inspire you, it’s going to be much harder to sustain in the long term, so choose carefully! 
  4. Fourth, entrepreneurs need to be flexible, creative, and open to change and adaptability.
    • This one can be challenging, but it’s critically important to understand. The business world is always changing, and so it’s essential that entrepreneurs are able to pivot and keep up with the latest trends and changes in the market. If you are a naturally curious person and love to learn or create new ways to do things, you’ve already got this skill. 
  5. Fifth, entrepreneurs need to learn how to network and build relationships with potential clients or customers. 
    • Nobody succeeds alone – even if you’re an introvert! Ultimately, your business exists to help people. Getting comfortable with meeting with and speaking to people about your business and how it can help your ideal clients achieve their goals will serve you well in the long run. 
  6. Finally, entrepreneurs should be committed to taking ACTION, even before they believe they are ready.
    • The world of business can be extremely competitive, and the adage of “the early bird gets the worm” is still true. As mentioned above, a big part of entrepreneurship is taking risks. For example, if you’ve got an idea that can solve a business or consumer problem in unique way, you need to make moves to get it out there quickly …before someone else does. 

How to Become an Entrepreneur

Now that we’ve defined what an entrepreneur IS, let’s dive into the steps on how you become one! 

Have a Plan for Financial Stability

Many people have the misconception that in order to become an entrepreneur, they must first give up their day jobs and live off of savings or investment money. This isn’t always the case. In fact, it’s usually better if you have a steady stream of income while starting your business.

There are several ways you can plan for financial stability while launching your business. Personally, I’ve seen many entrepreneurs start their businesses as a side hustle while they continue to save and work at their full-time job. This can be a great way to test your idea without giving up your full-time income and benefits. 

Plus, if you’re already up and running your business as a side hustle, it can also be easier to transition into full time work as you’ll already have an existing foundation of processes and customers you can build on. 

Other options to secure funding might be to chat with family or friends to see if they would want to invest in your idea. You could also take out a business loan from a bank or lending institution. However, banks won’t just hand you the cash… you’ll need to be prepared with a business plan and a host of details before a bank or lender will provide you with funds. So while it’s possible, you have to have a plan in place first. 

No matter the path you choose, you’ll want to make sure you have enough cash on hand to sustain yourself. This means cutting unnecessary expenses and watching your budget carefully. If there’s one thing I’ve learned on this journey, it’s to expect the unexpected and plan for unforeseen expenses, because life can be full of surprises. 

Build a Diverse Skill Set

Building a diverse skill set is important for entrepreneurs. When you’re first starting out, you may be doing EVERYTHING yourself while you get things up and running. In order to be successful, it’s beneficial to adopt a lifelong learning mindset and study a wide range of skills so that you can learn how to run your business in the day-to-day. 

The great news is that attending college isn’t necessary for you to gain these skills. In fact, there are many other free and low-cost ways to learn what you need to know. 

For example, YouTube contains a treasure trove of FREE information and tutorials on just about anything you want to learn. 

Type your question or idea into the search box and see what comes up. Spend some time watching videos and putting what you learn into practice. 

Or, you can seek out your local library or county economic development authority. They may have free or low-cost trainings available in your area. 

Consume Content Across Multiple Channels

In order to become a well-rounded entrepreneur, it’s important to consume content across multiple channels. This includes blogs, podcasts, books, lectures, YouTube videos, and events. By doing so, you’ll learn about other entrepreneurs and leaders, as well as pain points in various industries. You can use these pain points as inspiration for developing your solution through entrepreneurship.

Identify a Problem to Solve… and Solve it!

When starting a business, it’s important that you clearly identify the problem you’d like to solve. This can be anything from finding a better way to do something, or, addressing an issue that other businesses have. The key is to find a problem that consumers are interested in and that you can solve in a unique way. 

Once you’ve solved that problem, think about how else you can be helpful to your ideal customer. How can you add value? Adding value demonstrates your expertise and builds trust with your customers. 

Having trouble coming up with the problem you want to solve? Try this exercise! 

Close your eyes and put yourself in the shoes of the person you’re trying to help. What is it they want? What are their pain points? What do they need help with? How can your business or solution be of service to them? What do they wish they had? What would make their day-to-day life easier?

Brainstorm, take notes, and do research on what’s currently out there. See how you can present a unique or better solution. 

Network Like Crazy

One of the best things you can do as an entrepreneur is network like crazy. Get out there and meet people in your industry, attend events, and reach out to mentors. This can be a scary step if you happen to be an introvert, but it’s a necessary one in order to let others know about your business!

If you’re not quite ready to go out and network with strangers, consider tapping into your existing network of friends and colleagues. Who do you know that is already doing something related to what you want to do? Ask that person out for coffee and connect with them about it.

You can also try Googling local business or entrepreneur groups in your area to see if there are message boards, social media groups, or in-person meetup events that you can join.

Even if you’re an introvert, it’s important to put yourself out there and meet as many people as you can. You never know who you might meet or what opportunities will come your way. 

Lead by Example

Being an entrepreneur requires a lot of hard work and dedication. However, it is not just about working hard; it is also about being a leader within your company – talking the talk AND walking the walk. 

Leaders inspire their team members to give their best and achieve great results. Some of the most successful companies in the world have had great leaders, such as Apple, Microsoft, and Disney. If you want to be successful as an entrepreneur, you must lead by example.

What are the Benefits of Being an Entrepreneur?

There are many benefits to being an entrepreneur. These include the ability to do what you love while generating income, the ability to choose when and how you’ll do the work, choosing who you’ll work with, learning a wide variety of useful skills, and the freedom to think independently and make decisions for yourself – without having to “ask” a boss for permission. 

Entrepreneurship provides a sense of control over your life and future that is often not found in traditional 9-5 work arrangements. 

For example, entrepreneurs can choose when they work in order to be more present with the important people in their lives. Whether it’s to be present with school-age children, to care for elderly relatives, to spend all day with your favorite pup or kitty, or to travel more – YOU GET TO DECIDE. 

What are the Biggest Challenges Facing Entrepreneurs Today?

Entrepreneurs will face a number of challenges along the way. 

One of the biggest challenges is finding the right market. Without a specific target audience in mind, it can be difficult to make headway in terms of sales and growth. It’s important for you to get crystal clear on who you want to serve and what it is you want to do so that you can attract your ideal customers. Don’t rush through this – it’s a very important step. 

Scalability is also a big challenge that entrepreneurs face. First of all, how much do you want to scale? Do you want to expand? Can your business grow with demand in this increasingly-digital age? Are you ready and able to adapt quickly to changes in technology and consumer behavior? What is your plan for getting your product or service in front of the right people? Will you need a larger facility or more staff? When and how will you obtain those goals? These are all important questions to consider. 

Another big challenge for entrepreneurs is securing funding. It can be hard to find investors who believe in your vision and are willing to put money into your company. And once you do find investors, you need to make sure you’re using their funds efficiently and meeting the agreed-upon milestones so that they continue to support you.

Employee retention is another obstacle that entrepreneurs often face. It can be hard to keep talented employees when there’s always the risk that they could leave for a better opportunity. It’s important to create an environment where people feel appreciated and challenged, while also providing them with the resources they need to do their job well.

What are the Secrets to Being a Successful Entrepreneur?

There aren’t really any “secrets” to being a successful entrepreneur, but I’ll share some of the things that I’ve learned along the way. Take what you like and leave the rest. 

For me, the most important thing is to have a passion and a strong WHY for what you do, and to never, ever give up on your dreams. 

Believe in yourself and your ideas and stay focused on doing the tasks that will bring results. Be tenacious and don’t give up when things go wrong. Remember that failure only happens when you give up and quit. 

Get crystal clear on your vision for what you want to achieve and be willing to work hard – harder than you ever have before – to make it happen. 

Write things down. Get yourself a planner and write out your goals and your WHY. Use organizational tools to help you maximize your time, efforts, and motivation to keep moving forward toward your goals.  

Ask questions. Reach out to your friends, colleagues, and others in your industry. And, once you become successful, remember to give back and help others who are behind you on the path. There’s enough room for all of us to be successful in this world, and nobody succeeds alone. We all win when we work together.  

Don’t just talk about it, BE about it. Anyone can think about becoming an entrepreneur, but the ones who are successful are those who DO something about it. Be action-oriented and focus on taking the steps that will move you closer towards your goals – even if you don’t feel “ready.”

The Bottom Line: Are You Ready to Be an Entrepreneur?

This question always makes me smile. Are we really ever ready for anything

Successful entrepreneurs are people who take action before they’re ready, as they are driven by their goals and desire to make an impact, and they don’t let anything get in their way.

When you get started, know that you’re going to make mistakes. All of us do. It’s part of the journey. If you are passionate about what it is you do and don’t let minor challenges derail your progress, you’ll do fine. 

Since you’re the leader in charge of your company, it’s important that you trust your gut and always keep an open mind to new opportunities that come your way. You never know which new door might open.

You don’t need a degree from a fancy university to become an entrepreneur. If you are willing to work hard and stick with it, you can achieve your goals and live the life of freedom, independence, and financial success that most can only dream of. 

Posted in

Entrepreneur for More