What is entrepreneurship?
What’s an entrepreneur?
And what in the world is an entrepreneurial mindset?
In this post, we’re going to tackle the common questions people have about entrepreneurship. We’ll also look at well-known examples of entrepreneurs, entrepreneurship statistics you need to know and more.
Let’s dive right in.
What is Entrepreneurship?
At its most basic level, entrepreneurship is the process of starting or growing a new business and the risk — and reward — that comes with such an endeavor.
“Entrepreneurship refers to an individual or a small group of partners who strike out on an original path to create a new business. An aspiring entrepreneur actively seeks a particular business venture and it is the entrepreneur who assumes the greatest amount of risk associated with the project. As such, this person also stands to benefit most if the project is a success.”
What is an Entrepreneur?
An entrepreneur is someone who starts and runs their own business. They are typically creative, hardworking and not risk-averse.
Many entrepreneurs, such as Steve Jobs, Mark Zuckerberg and Jeff Bezos (more on them later), are responsible for groundbreaking products or companies.
What is an Entrepreneurial Mindset?
According to Wake Forest University:
“Entrepreneurial mindset refers to a specific state of mind which orientates human conduct towards entrepreneurial activities and outcomes. Individuals with entrepreneurial mindsets are often drawn to opportunities, innovation and new value creation.”
Here’s a simpler definition: An entrepreneurial mindset is a way of thinking that allows you to see opportunities where others may not.
This type of thinking is essential for anyone who wants to be successful in entrepreneurship.
What are the Types of Entrepreneurship?
According to the University of Michigan, there are four main types of entrepreneurship:
- Small Business
- Scalable Startups
- Social Entrepreneurship
Let’s briefly look at each:
1. Small Businesses
According to the U.S. Small Business Economic Profile, 99.9% of all businesses in the United States are considered small businesses.
These include mom-and-pop restaurants, daycare centers and self-employed freelancers.
2. Scalable Startups
A scalable startup is a company that has the potential (and desire) to grow rapidly. This type of company is usually (though not always) technology-based, has a business model that can be easily replicated, and is attractive to angel investors, banks, venture capitalists and so on.
Examples of one-time scalable startups include Uber, Airbnb and Pinterest.
Examples include Google (Alphabet), Flamin’ Hot Cheetos (Frito-Lay) and Post-It Note (3M).
4. Social Entrepreneurship
According to Duke University, “social entrepreneurship is the process of recognizing and resourcefully pursuing opportunities to create social value.”
In short, it’s a type of entrepreneurship that’s focused on solving social problems.
An example of a social entrepreneur is someone who starts a soup kitchen to help feed the homeless.
Another example would be someone like Scott Harrison, who founded Charity: Water, a non-profit organization that brings drinking water to people in developing countries.
What Skills Should an Entrepreneur Have?
According to Harvard Business School, there are six “must-have” skills every entrepreneur should possess:
- Basic Finance Skills — Can you budget? Perform risk analysis? Use Excel or Google Sheets?
- Networking — This is the process of building relationships with other entrepreneurs, both online and offline. Networking can be a great way to learn new skills and get advice from more experienced entrepreneurs.
- Speaking Confidently — No, mastering the art of public speaking isn’t a must for most entrepreneurs (though it certainly won’t hurt). But you need to be able to speak with confidence, both in person and on video.
- Accepting and Acting on Feedback — Are you open to feedback? Constructive criticism? And do you act on the advice given to you?
- Recognizing Patterns — Pattern recognition is an often overlooked skill for portfolios, but it can often be the difference between a successful entrepreneur and one who has plateaued.
- Maintaining a Growth Mindset — This is the belief that your abilities can be developed through effort, good teaching and learning from mistakes. This type of mindset is essential for anyone who wants to be successful in entrepreneurship.
How Do Entrepreneurs Develop Skills?
Google is packed with tips for developing entrepreneurial skills — some that are specific (“go to events and workshops in your industry”), some that are too vague (“be a visionary!”).
Here are a few enlightening ones:
1. Refine Your Interpersonal Skills
“Be confident, friendly and approachable,” recommends Hult International Business School.
“Practice these things daily and they’ll become habitual.”
2. Volunteer to Lead
According to Forbes, “the ability to lead a team and stay organized is important when you become an entrepreneur.”
Look for opportunities around you where you can be a leader. This could be anything from coaching a baseball team to planning the next family vacation.
3. Face Your Fears
“The only way to chisel away at (and what scares you) is to expose yourself to it,” claims the team at MasterClass.
That means taking a public speaking class if you’re afraid of public speaking. It means pressing play and recording a video if you’re uncomfortable on camera.
In short, do what scares you. Eventually, those things won’t scare you anymore.
What Are Common Misconceptions About Entrepreneurship?
There are several misconceptions about entrepreneurship. These include:
- Entrepreneurship is only for people with great ideas — Anyone can be an entrepreneur, regardless of whether they have a “great idea” or not.
- Entrepreneurship is easy — Entrepreneurship is not easy. It requires hard work, dedication and perseverance.
- You need to be wealthy to be an entrepreneur — You don’t need to be wealthy to be an entrepreneur. Anyone, no matter their financial situation, can start a business.
What Are Some Entrepreneur Statistics I Need to Know?
There are LOTS of must-know stats for entrepreneurs. Here are ten:
- Each month in the United States, 543,000 businesses are created. And since, as we learned earlier, 99.9% of the businesses in the U.S. are considered small, that means approximately 542,457 small businesses are created each month.
- Almost 84% of entrepreneurs choose to work in an area where they already have experience.
- In the United States, one-third of entrepreneurs stated their businesses will be family owned or operated.
- GenX makes up 46% of small business owners. Boomers follow close behind at 41%. Millennials make up 13% and 1% of entrepreneurs are from GenZ.
- Today, there are 114% more female-owned businesses than there were 20 years ago.
- 65% of entrepreneurs say they chose entrepreneurship to have the freedom to work when and where they want.
- Over 54% of entrepreneurs in the U.S. have a bachelor’s degree or higher; however, only 9% of entrepreneurs have a bachelor’s degree in business.
- The average amount of start-up capital needed by a small business owner is $10,000.
- Approximately 35% of small business owners use personal funds to handle financial setbacks in their business.
- Over 67% of the world’s wealthiest individuals made their money as entrepreneurs and business owners.
What Are the Qualities of a Successful Entrepreneur?
There are several qualities that are essential for anyone who wants to be a successful entrepreneur. These qualities include:
- Being passionate: You need to be passionate about your business in order to be successful.
- Being able to handle failure: Failure is a part of entrepreneurship. You need to be able to learn from your mistakes and move on.
- Being flexible: Things will always change in business. You need to be able to adapt and change with the times.
Who Are Famous Examples of Entrepreneurs?
We’ll wrap things up by looking at a few of the many famous entrepreneurs who have made an impact on the world.
Here’s a small sampling:
1. Steve Jobs
Steve Jobs was the co-founder of Apple.
Before passing away in 2011, Jobs was responsible for many of the company’s groundbreaking products. A college dropout who became one of the most successful entrepreneurs in history, Jobs is remembered for his vision, creativity, and innovation.
2. Mark Zuckerberg
He started Facebook in 2004 while he was a student at Harvard University. Since then, Facebook has grown to over two billion users worldwide.
3. Walt Disney
Walt Disney was an entrepreneur who created some of the most beloved characters in history. He was responsible for creating iconic characters, such as Mickey Mouse and Donald Duck. He also founded the Walt Disney Company, which is now one of the largest media conglomerates in the world.
4. Jeff Bezos
Jeff Bezos was born in 1964 in Albuquerque, New Mexico, and graduated from Princeton University in 1986.
After working on Wall Street, he founded Amazon in 1994. Amazon started as an online bookstore, but soon expanded to sell a wide variety of items.
Today, it’s one of the most valuable companies in the world.
5. Thomas Edison
Edison also founded the Menlo Park research laboratory, where he developed many of his most famous inventions.
Wrapping Up This Entrepreneurship Q&A
The most pressing questions about entrepreneurship — asked and answered!
But that said…
Did I miss anything?
Do you have a question about entrepreneurship I didn’t cover?
If so, let me know in a comment below!
If I like it, I may just update the post to include it 🙂
But before you go…
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