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Aktuelle Version vom 13:20, 29. Jun. 2012

Seven Top Differences Between Entrepreneurs and Businessmen

Entrepreneurs and businessmen are more often than not interchangeably used. I too happen to be responsible for using one or the another at times. However, I feel that there's a factor between the way entrepreneurs run their venture and businesses run their operation. Entrepreneurship is all about assuming risk and accepting whatever rewards or failures that occur subsequently. A businessman on the contrary follows a common path and takes lesser risk than an entrepreneur.Let's explore some of the points where entrepreneurship differs from running the company.

   Entrepreneur have been in the business of making new things
   The reason for clients are to recycle these products. Hence clients are a lot more like trading. By trading I am talking about purchasing goods in one place and selling in the other. It may also involve manufacturing at some step however the fundamental principal remains the same. Entrepreneurs create new things. They identify a problem and try to create innovative solutions which help reduce and sometimes eliminate problems. Even if they do trading, they'll apply innovative techniques to it. Let me give you an example. If the who owns retail chain is adding internet sales as one of his channel, he's just as being a businessman trying to find new methods for getting good business. However if he goes an creates an innovative product that never existed before, he's becoming an entrepreneur. Here, he has taken the danger upon himself.
   Entrepreneur's "Business" is exclusive
   An entrepreneur won't operate in places that there's already a crowd. He will use his scarce money to understand more about new. He'll for example, go for new channels of sales( internet, m-commerce etc), innovative products ( a brand new software), innovative marketing strategies( viral marketing) etc. He side steps the marketplace that is too competitive and works in a niche area.
   Entrepreneur puts their own money first
   Since individuals are not convinced of his ideas, entrepreneur needs to put his cash on the road first. He needs to show that a market are available for the products he is creating. Then only he is able to get external finance. This really is as opposed to a normal business, where it's known that market exists and therefore investors tend to be more willing to invest in such businesses
   Entrepreneurs dealing with new innovative products have more breakout chances
   If the risks are high, so might be the rewards. A successful entrepreneur reaps more monetary benefits than his business counterpart. A regular business with lower risk will get lower returns around the capital it invests. The surety of creating money in regular business is more than that of entrepreneurship though.
   Entrepreneurs experience more uncertainty than regular businesses
   Entrepreneurship is certainly more riskier and uncertain than conducting an ordinary business. An entrepreneur faces the question almost daily about success of his product, cost of developing the product, customer's adoption, team motivation and anything else. There's uncertainty and un-evenness of sales. A regular business however has pretty much regular sales and is less uncertain than an entrepreneurial venture
   Entrepreneurs share business ideas with team
   Entrepreneurs build on vision plus they cannot do it alone. So an entrepreneur constantly needs to remind his team and himself about what they are creating and why it will work. An Entrepreneur has to look for brand new ways to motivate the employees. The roles of employees change frequently in line with the perceived business conditions In business however, the roles of workers are same throughout the lifetime of the business
   Entrepreneurs share the success with the team
   Entrepreneurs do not have much cash to provide. Hence they offer equity to their employees. Once the venture works everyone who has a shares becomes rich. Among the prime example is Infosys technologies in Bangalore. It's created a lot of millionaires simply by distributing equities towards the founders and employees from the company. A business on the other hand is less open to sharing equity with employees and would pay higher salaries to compensate for this.

david cerullo

I nowhere say that businesses can't be entrepreneurial or the other way around but that there's a significant differences between your way a entrepreneurial venture along with a business works. A company however may become entrepreneur by doing something innovative while entrepreneur can reduce the uncertainty when you are more like a business.