Entering into the corporate world has many perks, such as getting hands-on experience and training, honing essential skills, and learning how a business really operates. All of this is great, but at some point in life, you might think that you are more suited to become an entrepreneur because that is more your style.
So if you are an aspiring entrepreneur, you ought to learn as much as you can to get some insight and knowledge before dipping your toes into this world. In this article, we will share everything you need to know about entrepreneurs, including:
- The definition of an entrepreneur
- Types of entrepreneurs
- Characteristics of an entrepreneur
- Necessary skills an entrepreneur needs
- Pros and cons of becoming an entrepreneur
Whether you already have a great idea in mind or not, this article will help you get a better understanding. Let’s get started!
Definition of an Entrepreneur
In simple words, an entrepreneur is someone who starts a new business venture while tackling the various risks and challenges associated with it, and in return, they make profits. The whole process of setting up a business is defined as entrepreneurship. Another definition of an entrepreneur is a person who brings an innovative idea, solution, procedure, or service into the market.
Entrepreneurs play an essential role in a community (or even a country) by using their skills to introduce new ideas. They also have a vital part in boosting the economy and providing job opportunities to many people.
What Does It Mean To Become An Entrepreneur?
Once the business is established, an entrepreneur continues to play an active role in its operations. Entrepreneurs usually finance their business through loans or savings. This means that every entrepreneur should have a strong knowledge about finance and how to invest their money the right way in order to prevent major losses and debts.
Becoming an Entrepreneur
There is no single correct answer to how a person can become a successful entrepreneur. However, the following steps are typically involved in every entrepreneur’s journey:
- Come up with an innovative idea that would appeal to the market.
- Gain knowledge about the various business-related fields, such as finance, management, economics, and marketing.
- Create a business plan and evaluate the source of finance for your startup.
- Set up the basic platforms for brand awareness and marketing, such as social media networks.
- Recruit members to plan, manage, support, and maintain your business.
- Create diverse strategies for launching a brand, retaining, and gaining customers.
- Expand into new areas and different product lines to earn more profits.
As the company begins to grow with time, entrepreneurs must be involved in creating strategic long-term and short-term plans for growth and development. Most entrepreneurs also focus on honing their interpersonal, professional, academic, and technical skills by pursuing higher education, such as a Master of Business Administration (MBA) degree.
Four Types of Entrepreneurship
Anyone who is interested in starting their own business should consider what type of venture they want to set up. The following are the four basic types of businesses an entrepreneur can have:
Small businesses represent the majority of entrepreneurial ventures. It could be any company – a restaurant, a small retail outlet, or even a salon. Small businesses are usually opened without the intention of establishing into a conglomerate, franchise, or a huge chain. For example, a single grocery store around the corner of a street is a small business. Creating a chain of the same store around the country is not. Small business owners generally use their own savings to set up and run the operations of their business and only earn money when their business succeeds.
Scalable startups are far less common than small businesses, although they tend to get a lot of attention. This type of business starts off small, even smaller than a small-scale business. For example, scalable startups may start inside a garage or in the attic and then turn into giant companies (read: Apple). They are merely great ideas that need a little push to become something great.
So how do they grow? Outside third parties, such as financial investors, usually invest in the idea until it becomes something much larger and eventually scales up to become a large corporation.
Sometimes, many entrepreneurs are already working for large, well-established organizations. Imagine that you work for an automobile manufacturer. You conduct thorough market research, and you conclude that there is a very high demand for mini cars. You also realize that the company you work for has the necessary knowledge, potential, equipment, resources, and processes to manufacture a mini car. So you pitch the idea to your boss and request funding for this project. If you get the required approval, you will officially be a player in the world of entrepreneurship and pave your way forward throughout your project.
Social entrepreneurship is the fourth type of entrepreneurship that provides pioneering solutions to community-based issues. Social entrepreneurs bring about positive changes in society by taking risks and putting forth their ideas. They launch organizations that are mainly about creating change and influencing people and don’t really focus on generating profits. For instance, social changes may mean environmental changes, societal changes, racial or gender equality, or philanthropic activities. Social entrepreneurs usually set up their own websites or start their companies using social media platforms by going viral.
Characteristics of an Entrepreneur
Not everyone is a natural-born entrepreneur. Although some of the characteristics might be present within you naturally, others are built with time through experience and learning. Here are some of the important characteristics of an entrepreneur:
Successful entrepreneurs are passionate about what they do. Whether it is a new innovative idea, an improvement of the existing idea, or a revolutionary service, strong and successful entrepreneurs believe in themselves and know that what they have to offer is a game-changer for the entire course of business. They also know how to communicate their passion to others and how it will benefit them in the long term. They are not afraid to bring their ideas forward and take risks to achieve something bigger.
As an entrepreneur, you will eventually have to strive to do everything better than your competitor, at least during the initial years. Even as your business establishes, you would still be interested in knowing what is going on in various departments, including marketing, finance, and accounting. If you are not aware of the basic business strategies and don’t have the necessary knowledge about finance or marketing, a business degree might come in handy. A specialized degree program will help you learn the basic aspects of running a business and may even be handy in bringing life to your dreams. Some business schools help to build a solid foundation that every entrepreneur needs, especially in today’s world.
Confidence and passion go hand in hand. They both are important traits of an entrepreneur. Successful entrepreneurs believe that they have what it takes to make their dreams come true and make their product successful in a market. This also means that they are not afraid of taking risks or trying a new approach if their initial plans don’t work out. Confident entrepreneurs have the ability to overcome challenges and stand strong in the face of adversity.
Entrepreneurs should be excellent planners. You might have heard of the saying, “nobody plans to fail, they just fail to plan.” This could not be truer for entrepreneurs. This implies that every entrepreneur should have a solid plan; it also teaches us that plans tend to change, and when they do, you should be ready to embrace new plans. Entrepreneurs need to be flexible enough to discard their original plan in exchange for a newer, better, and more practical plan.
This is another important characteristic of a successful entrepreneur. Being an efficient marketer involves many sub-traits, such as being an extrovert, which is something some entrepreneurs might not be very good at. Nonetheless, this skill can be learned and mastered easily.
One of the most important things that marketers need to possess is the ability to present an elevator speech. This means that they should be able to sum up the important aspects and benefits of the product or service they want to launch. A good way to practice this is by imagining that you are in an elevator with a potential customer, and you want them to take an interest in your product. And you only have about 45 to 50 seconds to pitch your idea.
Once you have prepared an effective and engaging elevator speech, use it to your advantage. Use it everywhere. For instance, talk about it with your friends, family members, community members, suppliers, customers, etc. Don’t shy away from calling or connecting with people who might be able to help you out. This way, you will develop confidence and even spread the word about your product.
An entrepreneur should know how to manage their money. You should know where you need to invest your money, what you need to purchase, and when you should avoid spending it. You should also have basic knowledge about accounting and financing so that you are able to keep track of your money even if you hand over the responsibility to someone else.
Entrepreneurs should be strong and never give up on themselves or their business. It is not easy to bring a new product or service into the market as there are many challenges and issues that every entrepreneur has to face. Even if you have a strong passion and you are very confident, there will be times when you might feel like giving up. This is when you have to build the strength to pull yourself back together and get back on track. You will have to use your knowledge, expertise, passion, and commitment to give it one more shot and start over.
Essential Skills Every Entrepreneur Must Have
Entrepreneur skills contain a wide range of skill sets, such as technical skills, interpersonal skills, leadership skills, creative skills, and business skills. Developing these skills is important because they can be applied to any job role within an industry and help you throughout your journey. For example, in order to be a successful small-scale business owner, you need to have expert business management skills. Or, in order to build successful teams, you need to work on your leadership or communication skills.
Entrepreneur skills can encompass both hard and soft skills. Since entrepreneurs have to take on various roles, they might need to develop different skill sets in order to grow and become successful. Here are a few examples of the common skills that every entrepreneur must have:
- Business Management Skills
- Teamwork and Leadership Skills
- Communicating and Listening Skills
- Customer Service Skills
- Financial Skills
- Analytical and Problem Solving Skills
- Critical Thinking Skills
- Strategic Planning Skills
- Technical Skills
- Time Management and Organizational Skills
- Branding, Marketing, and Networking Skills
How to Improve Your Entrepreneur Skills?
There are different ways to improve and work on your entrepreneurial skills. For instance, you could take up a course, attend seminars, or participate in workshops. You can consider the following actions to build or improve your entrepreneurial skills:
- Take up a course, diploma, or degree
- Attend events, workshops, or seminars
- Connect with experienced and professional mentors
- Work on your leadership skills
- Learn how to manage your finances and investments
The Pros and Cons of Becoming an Entrepreneur
After graduating from college, the next step is figuring out what to do. You can either enter into the corporate world and get a great job or you could launch your own business and become an entrepreneur. You are obviously reading this article because you aspire to become an entrepreneur. Whether you want to start a business on the side or start freelancing, there are benefits and drawbacks to choosing entrepreneurship. Here, we will discuss some of the pros and cons of becoming an entrepreneur.
One of the best things about being an entrepreneur is that you have freedom and independence. You get to do your own thing and enjoy running your business your way with your set of rules and regulations. You don’t have to report to anyone or be accountable to anyone for your actions because you are your own boss.
With all of the extra responsibility, you also have extra flexibility to work at your own pace. Many people like the idea of entrepreneurship because they can work where they want, whenever they want. For example, you can even work for your business at your very own local coffee shop or at the comfort of your home.
Many individuals want strong control over their work and don’t really work well under a boss or supervisor. Becoming an entrepreneur can be beneficial for anyone who wants more control and authority over their work. However, taking control of your venture and lifting it up requires immense hard work and efforts, but at the end of the day, you make your dreams come true, and that reaps its own rewards. Having control and influence over the direction of your business is ever so important and is one of the most exciting aspects of becoming an entrepreneur.
Instead of making others rich, you make your own profits that slide into your own pockets. This means that the success of your business is basically your own success that allows you to grow more. This can also motivate you to develop more and getting better results. It automatically opens up many opportunities for success and steers you in the right direction.
The future of your entire business is in your hands, including the next steps, long-term plans, new products, future objectives, etc. This also means that if there is a setback, you will be risking your savings, time, and effort to bring your business back on track.
Being an entrepreneur is not easy, and it can surely take a toll on anyone. It takes a lot of effort to get a business up and running, and it takes even more effort to make it successful – especially during the initial years. It can be difficult for a single person to carry all of the weight, and no matter how exciting it may seem, it can be equally exhausting.
The idea of running your own business can be different from what you might think. For instance, you might have to stay up late at night, work over the weekends, and get no breaks. Being an entrepreneur has its own unique challenges that you will only be able to understand once you become one.
Are Entrepreneurs Born or Made?
Nobody is born with all of the essential traits that an entrepreneur should have. There is no ‘one-man band’ in becoming an entrepreneur, and most of the traits are learned with time. Besides, there is always room for improvement no matter what career you choose.
Is It Better To Be An Entrepreneur or An Employee?
Honestly, it all depends on the type of business you run or the type of job you have. On average, most entrepreneurs are happy with their business because of the success rate and the profits they generate. On the other hand, people who have a 9-5 job can also be happy if they love what they do and have more control and authority over their work.
Is It Easy To Be An Entrepreneur?
No. becoming a successful entrepreneur is not a piece of cake or a walk in the park, and it is definitely not for everyone. It often takes years of hard work, patience, endurance, long work hours, and a lot of pitfalls to become successful. Not everyone has the guts to endure the challenges and the heartaches, especially individuals who tend to give up easily and run out of patience (or money).
Why Do People Become Entrepreneurs?
Some people take up the journey of becoming an entrepreneur to bring their ideas to life. They make it their life’s purpose and mission to recognize their talents and make a difference in society. Entrepreneurs have the need to succeed and control their own path. Besides, not everyone is well-suited for a regular job.
Is Entrepreneur Magazine Any Good?
Entrepreneur magazine usually has good tips for startups and small-scale businesses. Some of the content is also directed towards huge enterprises and features stories about how a business grows. It is a good read for anyone who wants to learn from the success and failures of other businesses.
The Bottom Line
An entrepreneur is an individual who creates an idea or a product and turns it into a viable business to generate profits. It requires dedication, efforts, consistency, passion, and time and not everyone is cut out for the world of entrepreneurship. Entrepreneurs are highly-motivated individuals who are ready to take risks and accept challenges while having a clear vision in mind. They enter the market because they love what they do and want to create an impact in the economy as well as in the lives of their customers. The bottom line is that becoming an entrepreneur is not easy, but it is not impossible either. Good luck!