Entrepreneur: Definition, Meaning & How to Become One

Aspiring entrepreneurs have no shortage of role models. Successful entrepreneurs and their business ventures have been making headlines for decades. However, it takes more than a business plan, necessary resources and an innovative idea to become an entrepreneur, let alone turn a profit. There are certain behaviors, attitudes and skills commonly found at the heart of entrepreneurs and their successful businesses.

According to the Cambridge Dictionary, the word "entrepreneur" comes from the French word entreprendre, or “to undertake." The idea of entrepreneurship is often credited to German-Austrian political economist Joseph Schumpeter. The definition of entrepreneurship is when someone starts their own business, especially when that business venture involves new opportunities, expected profit and risk-taking.

An entrepreneur is someone who organizes and manages a new business and assumes all risks of the enterprise. More generally, Harvard Business Review calls entrepreneurship the pursuit of opportunity beyond perceived barriers or constraints. Stanford University tags on the idea that an entrepreneur sees an opening in the marketplace and has the sense to seize it.

In short, an entrepreneur is the visionary businessperson and risk-taker who brings a business idea from ideation to reality or seizes a business opportunity despite any inherent obstacles and financial risk. The majority of entrepreneurs are self-employed, and many manage startups that are intended to grow in scale.

An intrapreneur has the characteristics of an entrepreneur but is an innovator who works within an established organization or company and therefore does not personally assume the financial risks of an entrepreneurial venture.

The Small Business Association, Stanford University and Harvard Business School Online outline several traits that echo among entrepreneurs:

• Risk-taking
• Urgency and persistence
• Ability to recognize opportunity and talent
• Focus and perspective
• Independence, collaboration and mentorship
• Creativity, curiosity and problem-solving
• Stamina and resilience
• Storytelling and sales pitch
• Basic business skills and excellent communication skills

Entrepreneurship involves an innovative idea or innovative product that takes creativity and curiosity to discover, nurture and develop.

An entrepreneur assumes financial risks and all other risks involved in startup costs and assuming responsibility for a new business venture. Because they are forging their path and will likely need to secure venture capital or angel investors, an entrepreneur needs to be independent, persistent and able to sell their story. Entrepreneurship isn't typically a 9-to-5 job. Starting a business often requires long hours and personal sacrifice.

As much as an entrepreneur needs independent thought, tolerance for risk and motivation, many also reach out to mentors and angel investors and seek out other support to help their new venture get off the ground.

Just as there are many different types of businesses, there can be various types of entrepreneurs and entrepreneurship. According to the University of Michigan, the four main types are:

• ‌Small business owners‌‌:‌ Entrepreneurs who are their own boss and have a business venture typically not intended to scale up or franchise
• ‌Scalable startup businesses‌: New products or business ventures designed to attract investors, reach new markets and grow quickly
• ‌Intrapreneurs‌‌:‌ Employees with an entrepreneurial mindset who develop new products or business strategies for an existing business
• ‌Social entrepreneurship‌: New business ventures intended to create positive social or environmental change
• ‌Serial entrepreneur‌: As the name implies, one who starts more than one new business over time

The types of entrepreneurs aren’t limited to any one list. Entrepreneurial drive, spirit and thinking come in many shapes and may be called by various names.

Some famous entrepreneurs include:

• ‌Bill Gates‌: Microsoft
• ‌Steve Jobs:‌ Apple
• ‌Mark Zuckerberg:‌ Facebook, Meta Platforms
• ‌Elon Musk:‌ Tesla and SpaceX
• ‌Jeff Bezos:‌ Amazon
• ‌Larry Ellison:‌ Oracle

These are just a few of the millions of entrepreneurs in the world. According to Global Entrepreneurship Monitor and Babson College, there are more than 580 million entrepreneurs worldwide.

The family-owned pizzeria down the street, the kids offering to shovel your driveway and the artist selling handmade crafts on an e-commerce site are also entrepreneurs. The U.S. Department of Commerce calls American entrepreneurial spirit one of the country's greatest assets.