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Seven Top Differences Between Entrepreneurs and Businessmen
Entrepreneurs and businessmen are more often than not interchangeably used. I too have been responsible for using one or the another at times. However, Personally i think that there is a significant difference between your 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 other hand follows a common path and takes lesser risk than a business owner.Let us look at some of the points where entrepreneurship is different from running the company.
Entrepreneur have been in the business of making new things The purpose of business is to recycle the products. Hence clients are more like trading. By trading I am talking about purchasing goods from one place and selling at the other. It may also involve manufacturing at some step but the fundamental principal remains the same. Entrepreneurs create new things. They identify an issue and try to create innovative solutions which help reduce or eliminate problems. Even if they do trading, they will apply innovative techniques to it. Allow me to give you an example. If an who owns retail chain is adding internet sales among his channel, he is just as being a businessman trying to find new methods for getting more business. However if he goes an creates an innovative product which never existed before, he's becoming an entrepreneur. Here, he has taken the risk upon himself. Entrepreneur's "Business" is exclusive An entrepreneur will not operate in areas where there is already an audience. He'll use his scarce money to explore new. He'll for example, go for new channels of sales( internet, m-commerce etc), innovative products ( a brand new software), innovative marketing techniques( viral marketing) etc. He side steps the market that's too competitive and works inside a niche area. Entrepreneur puts his own money first Since individuals are not convinced of his ideas, entrepreneur has to put his cash on the road first. He needs to show that an industry are available for these products he's creating. Then only he is able to get external finance. This is as opposed to a normal business, where it's known that market exists and therefore investors tend to be more prepared to invest in such businesses Entrepreneurs working with new innovative products have more breakout chances If the potential risks are high, so are the rewards. An effective entrepreneur reaps more monetary benefits than his business counterpart. A regular business with lower risk can get lower returns around the capital it invests. The surety of making money in regular business is in addition to that of entrepreneurship though. Entrepreneurs experience more uncertainty than regular businesses Entrepreneurship is definitely more riskier and uncertain than conducting a regular business. An entrepreneur faces the question just about every day about success of his product, price of developing the merchandise, customer's adoption, team motivation and everything else. There is uncertainty and un-evenness of sales. A normal business however has pretty much regular sales and is less uncertain than an entrepreneurial venture Entrepreneurs share businesses with team Entrepreneurs develop vision plus they cannot do it alone. So a business owner constantly must remind his team and himself by what they are creating and why it will work. A business owner needs to look for brand new ways to motivate the workers. The roles of employees change frequently in line with the perceived business conditions In business however, the roles of workers are same through the lifetime from the business Entrepreneurs share the success with the team Entrepreneurs don't have much cash to offer. So they offer equity for their employees. When the venture works everyone who has a shares becomes rich. One of the prime example is Infosys technologies in Bangalore. It has created a lot of millionaires just by distributing equities to 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 it.
I nowhere state that businesses cannot be entrepreneurial or the other way around but that there is 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 a lot more like a company.
