What is an entrepreneur?

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Every second week, Miriam will be bringing you discussions from the field of innovation and entrepreneurship. This week, she gives an overview of the most common thoughts on what defines the entrepreneur.

The admiration of the entrepreneur has been well documented since the early 18th century. He or she represents qualities such as initiative, hard work, great ideas, team building and leadership. However, there have been, and still are, disagreements of what constitutes an entrepreneur. Does an entrepreneur mean creator of a startup, or does one have to have a groundbreaking idea to qualify? A popular view is that entrepreneurs are people who run their own companies, especially small businesses or large ones that once were small. Several researchers of entrepreneurship have argued that although this is often the case, there are other characteristics that are more important, characteristics that more accurately describe the entrepreneur.

Richard Cantillon, an Irish-French economist, was the first to define the term. He regarded the entrepreneur as a risk taker, a person who buys at certain prices in the present and sells at uncertain prices in the future. Frank H. Knight and Peter Drucker were in line with this view. They emphasised that entrepreneurs are willing to risk their career and financial security in order to pursue an idea. In other words, the entrepreneur is a bearer of uncertainty.

The Austrian-American economist Joseph Schumpeter disagreed. For him, the entrepreneur was an innovator, while the capitalist was the risk taker. In the Schumpeterian view, entrepreneurs come up with new ideas or inventions and use these to form high-growth businesses. In the first part of Schumpeter’s career, he focused on the individual entrepreneurs and their importance for the economy. Later, he put more emphasis on research and development within big organizations. This supports the modern idea that entrepreneurship is a mindset, rather than a process initiated by an individual.

However, the entrepreneur is still mostly regarded as a person who is self-employed. Rory MccGwire, founder of The Marketing Donut, stated that “an entrepreneur is someone who, rather than working eight hours a day for someone else, would prefer to work 18 hours a day for him or herself”. Justin Bariso added that the entrepreneur normally has “half the pay, twice the stress, but ten times the fun”.

Miriam Øyna

Miriam is Incubate’s innovation columnist. In her free time, she is dancing ballet, eats marzipan and comments on other people’s language. She is a typical eternal student, with a Bachelor degree in Journalism, a Master degree in Society, Science and Technology and has now embraced Business Economics.

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