What is an Entrepreneur?
So in my first business school class—International Entrepreneurship—the professor opened discussion with the question, What is an “Entrepreneur?” The discussion focused on a few theories—most of them in conflict with my own understanding of entrepreneurship. Other students focused on innovation and technology, on increasing profits, and elevating entrepreneurship to the realm of big business.
I held—and still hold—that entrepreneurship is mostly this: Being your own boss. That’s the main thrust of entrepreneurship. An expanded definition: Being your own boss, with your own money, and taking on ultimate risk for your ultimate gain.
Let me explain. An entrepreneur decides that he (or she) wants to be his own boss. I don’t have to answer to anyone else but myself. This entails investing your own, personal capital into a venture. Because whose ass is on the line? Yours. Why is this not a problem? Because if you risk your ass—and mostly your ass—then all the gains at the end of the day are yours.
Many people in class spoke of “intrapreneurship”—a concept which is etymologically unsound, but we’ll take it as it is. You work for a big company, say, IBM, and your boss asks you to take over a product line. It’s all yours—figuratively speaking. You build your team. You make lots of money. It’s a huge success.
But, sorry, buddy, you’re not an entrepreneur. You see, you still have a boss. You were told to do this. You were *allowed* to do this. Whose capital did you use? The company’s. What happens if you fail? You get your old job back. And in the end, if you’re successful, if you go gangbusters? Well, here’s your paycheck. Equity? Well, you get your stock options in the big company, thank you very much.
That’s not entrepreneurship. When you’re an entrepreneur, you initially answer to no one. It’s all you. If you fail at the initial stage, you lose your job. Then, you get investment, and you’re still (mostly) your own boss, and because of that you retain a percentage ownership in your product. If you fail? You lose your job. If you succeed, you make money. And not just your hourly wage. You get your equity—the value of your idea plus your blood, sweat, and tears. If you’re lucky, you make a ton. If you’re not so lucky, you should still make a lot.
And innovation? Sure, there’s usually some involved. Technology? Probably, but it’s not necessarily with computers. Great ideas don’t need computers. They need entrepreneurs, and that’s all.
My uncle went nearly 50-50 with my dad into a dry cleaning business. They put about $400K into it. They sold it for over $2M. They weren’t major innovators or technologists or geeks with laptops. Were they entrepreneurs? Damn skippy, they were.
Entrepreneurship has a sexy ring to it. Everyone wants to be an entrepreneur; everyone wants to be their own boss. But people slated for middle-management who want to foster their own entrepreneurial spirits? Come on. You’re just trendy hipsters trying to get a cool title to make yourself feel better for being someone else’s bitch. If I give you a lot of responsibility, the chance to build your own team, the freedom to make your own decisions, and capital to run a new idea? I call that “doing your job.” If you take all the responsibility, build your own team, make all your own decisions autonomously, and put in your own capital? You’re an entrepreneur then.
[Soap box discarded.]