Myths about Entrepreneurs and Businessmen
Reading time –10 minutes.
Businessman and Entrepreneur is Not the Same
This article is about entrepreneurship and the main characteristics of people in business and entrepreneurs. You will learn a few myths about business people. You will also realize what different roles businessmen and entrepreneurs have in the market and how they act to reach their goals. Moreover, you will learn about a few great online courses for entrepreneurs.
Entrepreneurs and businessmen have pretty many things in common. Have you ever wondered what the differences are between them?
Entrepreneurs provide solutions for consumers, create jobs, and assist in developing a particular country’s economy. The businessman is responsible for a large part of the profits of his company.
- Have you ever given it a thought that there is a subtle difference between a businessman and an entrepreneur, although these two terms are often used interchangeably?
- Business people and entrepreneurs indeed have many similarities: both create jobs for unemployed, provide solutions to consumers, and contribute to the country’s economies;
- However, their activities vary in many ways: a businessman starts his business from the existing idea, whereas entrepreneur builds on his unique idea or concept; business is profit-oriented, in contrast to an entrepreneur whose focus is on people (consumers, public, employees, etc.); a businessman sees the world as an opportunity to make his living, whereas entrepreneur instead seeks to serve the world;
- If you understand the core differences between the two market operators, you can realize your talents and core competencies and capabilities and find a perfect fit for your employment.
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Business and Entrepreneurship Definitions
Companies are defined as organizations that engage in commercial, industrial, or professional activities. The term business also refers to an organization around a person who sells goods and services. Companies can operate as organizations with or without profit, carry out charity activities, or promote social responsibilities. The company’s size ranges from individual companies to international groups and from small companies to large corporations.
The term “entrepreneur” derives from the French verb “entreprendre,” which means taking on risks to make profits. Although the concept of entrepreneurship has existed for centuries, classical and neoclassical economists have excluded entrepreneurs from their formal models. They assumed that perfectly rational actors use complete information, leaving no room for risk – discovery. Economists never had a standard definition of entrepreneurship. It was not until the mid-twentieth century that they incorporated entrepreneurship into their model of economic activities.
What is a Business?
Video Source: https://www.investopedia.com/terms/b/business.asp
Schumpeter said that entrepreneurs, not just businesses, are responsible for creating new business models in search of profit. Kirzner saw entrepreneurship as the process leading to discovery, and Knight focused on entrepreneurs because he believed they were responsible for the risk premium in financial markets. All three thinkers were central to understanding the role of entrepreneurs’ “involvement in the development of the financial system and other areas of life.”
Who is an Entrepreneur?
Video Source: https://www.investopedia.com/terms/e/entrepreneur.asp
Main Differences between a Businessman and Entrepreneur
The words “businessman” and “entrepreneur” are often used interchangeably, and indeed, they have many similarities. Both businessmen and entrepreneurs create jobs, provide solutions for consumers and actively contribute to the economic development of a country. Yet, there are differences between the two types of activities. Businessmen work for a profit, whereas entrepreneurs are more concerned with changing the world.
Most business people do business to make a profit, earn a living, achieve their financial goals, and become their own boss. In business, you are focusing on financial returns. Businessmen take calculated and managed risks as they cannot afford to lose money or suffer bankruptcy. That is why, in business, you always do the math calculations.
In contrast, an entrepreneur is someone who conceives an idea or solution to a current problem that society is facing. An entrepreneur is an inventor of an idea, a creator of a new product. As entrepreneur, you strive to make a difference in the world, which is both your passion and ultimate goal.
Entrepreneurs are like skydivers and often don’t care about losing time or money to pursue a passion. Entrepreneurs do their best by completing the things they love the most, which leads to great success. If you do this with love, joy, and passion, you will receive extraordinary rewards.
Different Attitudes to Employees and Customers
Entrepreneurs are employers and managers. They hire employees and workers to grow the business. These are friends and managers, but not employers or managers in the traditional sense of the word. These peers and people will never treat you like a machine, and they help you to grow. Entrepreneurs don’t see customers as their source of income but rather view them as sources of fulfillment. Customers are the lifeblood for you and your company.
Entrepreneurs try to beat their competitors, but they also see cooperation, not competition, as a means to achieve specific goals. Most entrepreneurs need a good economy to succeed, especially in retail, franchising, and the financial sector. Losing money is one of the biggest worries for business people, but not for entrepreneurs. Entrepreneurs don’t really care about money because they can always start over again.
The Visions of the World Market
Business people spend time on marketing campaigns to promote their products. They always look at the clock as they don’t want to fall behind the schedule. These people are fast and always busy. Business people see the world as an opportunity to make their living: they consider the world as a duty rather than a chance.
Entrepreneurs resemble artists or scientists as they spend time perfecting their product. The product should be a masterpiece, and they need to bring it to the state of perfection. Entrepreneurs care about the success of their company and its stakeholders, such as employees, customers, families, friends, suppliers, partners, investors, etc. Entrepreneurs just do their job and let history determine their success.
Both entrepreneurs and businessmen pay important roles in the economic development of their countries. Below you can see the Key Differences Between Entrepreneur and Businessman:
Myths about Entrepreneurs
All myths are partly true, and myths about entrepreneurs are not an exception. For example, entrepreneurs love to deal with the unknown. They take uncalculated risks to retain and consider resources. However, not every entrepreneurial venture is a real breakthrough in terms of new ideas. For the most part, entrepreneurs start businesses without revolutionary inventions: most of them adopt a mix-and-match approach.
McDonald’s didn’t invent the cheeseburger, Starbucks didn’t invent coffee, and Google didn’t create the Internet, but these companies are entrepreneurial by their nature. Most entrepreneurs are young, inexperienced people who pursue their passions. Entrepreneurs often leave their home countries to gain valuable experience in their field of interest.
They do extensive research before taking the first step to create a new concept or a product. However, they may take risks depending on the potential offers to raise capital. Funding is the most crucial prerequisite for the set-up of any enterprise, and entrepreneurs often start with sufficient money. Some entrepreneurs fail to raise enough capital from outside sources if they cannot prove their credibility.
Being a Successful Entrepreneur Means to Have a Good Intuition and the Ability to Change
Becoming an entrepreneur is not rocket science, but why do some entrepreneurs grow while others fail? Today entrepreneurs can raise funds thru start-up investments, venture capitalists, and even private equity firms.
There is no single way to succeed, and entrepreneurs do not necessarily know whether a particular idea or innovation is viable or not. Successful entrepreneurs trust their gut instincts, make quick decisions, and follow a lengthy process of market research to implement their ideas into life.
Entrepreneurs focus intensely on opportunities and do not bother about non-strategic activities and distractions. Entrepreneurs are positive thinkers: they tend to learn from mistakes rather than “crying over spilled milk”. It is about focusing on the important, and not just the urgent matters, including the ability to prioritize tasks. If you want to succeed in the business world, you have to accept that you may fail and that it may cause you a lot of suffering.
I think it is better to recognize the mistakes, correct them and move on with your life. To lead a successful company, you need to think fast, stay open-minded, pursue an agile management style and embrace continuous learning while adapting new information as it becomes available. When something goes wrong, entrepreneurs are not afraid to change lanes and do something else. This may seem like a fickle change of heart to your employees, and it means acting quickly.
The reward equation in the business world is linked to innovation. Business is a combination of innovation and risk-taking and the ability to adapt and change. You have to know who you are, talk to your customers, and interact with other players. Entrepreneurship does not occur in a vacuum; many role players influence its activities from the beginning of the life cycle. The success of the business in the complex ecosystem is directly related to an entrepreneur’s ability to solve problems and boost a company’s growth trajectory.
Money Management Rules
Successful entrepreneurs should be careful with money as it is funds that keep a company afloat. Moreover, it is almost always more challenging to raise capital than one thinks. So, you shouldn’t spend your company’s money prematurely, especially in case of a sole proprietorship, or make the wrong tax decisions.
As entrepreneurs, we always want to have a full plate and still feel we can take on any task. But if we keep adding to our comprehensive range of dishes, they will eventually collapse under the weight of excessive pressure.
Collaboration Within the Company is Sufficient
Don’t let stubbornness stop you from asking for assistance. Don’t be afraid to assign tasks to an experienced employee who may complete the job better than you. It is essential for high growth and low growth potential companies, especially in their set-up stages. You never know when you might meet an ex-colleague or boss and seek their help.
If you are on a dead-end road and need to discuss things, a professional network of industry veterans can help. Many entrepreneurs hire people with similar experiences, but the trick is to find qualified employees and treat them right. Otherwise, people get bored with you and do not treat you with respect.
Musk wrote that it is essential to look at knowledge as a kind of semantic tree to make sure you understand all the details. You need to be aware of a company’s business plan, business model, and strategy before you get to other details. That’s not all Elon knows, but he realizes that it’s vital looking at all our knowledge as a kind of semantic tree and make it easy to understand, even if we don’t know some details.
10 Excellent Free Online Courses for Entrepreneurs
Please note that some courses are offered weekly, while others are scheduled regularly. You can register for scheduled classes at any time of the year or take courses on an individual basis at a later date:
- Essentials of Entrepreneurship: Thinking and Action
- Developing Innovative Ideas for New Companies: The First Step in Entrepreneurship
- Entrepreneurship 101: Who Is Your Customer?
- Degreed’s Entrepreneurship Learning Pathway
- How to Build a Start-up?
- Thinking Outside the Box: Creative Entrepreneurship
- DQ101: Introduction to Decision Quality
- Design Thinking for Innovative Problem Solving: A Step by Step Project Course
- New Venture Finance: Start-up Funding for Entrepreneurs
- Fundamentals of Entrepreneurship: Pitching Your Business and Yourself
Although an entrepreneur and businessman may seem to play similar roles, there is a significant difference. An entrepreneur becomes a businessman in the long run. The fine line between them both is that the entrepreneur is always the market leader, while the businessman is a market participant.
There are 10 differences between businessmen and entrepreneurs:
- The exclusiveness of the idea;
- The way they treat employees;
- The purpose of doing business;
- The way they see the competition;
- The degree of risks taken;
- The way they treat customers;
- What they think of money;
- How they deal with time;
- How they see the world;
- How they define success.
To sum up, the businessman focuses on coordination, cooperation, and resources, while the entrepreneur is a market participant and market leader in his own business. Your gut instincts, innovative approach, flexibility, efficient time management, and the right support system will help you become a successful entrepreneur.
Most of us usually notice the similarities between both entrepreneurs and businessmen. Still, there are significant differences that we considered today. If you struggle between these two ways of career, you should, first of all, make yourself some acquaintances in both spheres. People can share some valuable tips and their own experience in various professions with you. Visit the courses or seminars to decide what interests and suits you best. For example, you can find some of them in the article above.
No matter what option you choose, you should continuously develop your hard and soft skills. To lead a successful company, you need to think fast, stay open-minded, and embrace continuous learning while adapting new information. Also, don’t let stubbornness stop you from asking for assistance. It is essential for high growth.
Join the list in the comments section below and add tips and tricks for money management, business administration, and financial planning.