What Is an Entrepreneur?

What is an Entrepreneur?

Debated for many years, this vital question to the study of entrepreneurship continues to be criticised and analysed by some of the worlds leading researchers. The term entrepreneur comes from the French word entreprendre, which means to under take or to go between. Entrepreneurship did not really emerge into the UK until the Thatcher years (1970s) after the de-regulation of many of the country’s companies including

gas, electricity, water and the railways. It was almost an insult to be named an entrepreneur pre 1980s. However, by the 1980s, the way Britain was viewed from oversees altered and there became more focus on entrepreneurship and new venture planning within the economy.

In order to understand “what is an entrepreneur”, it is also important to establish “who is an entrepreneur.” By studying the personality, traits and psychology of an entrepreneur, one can help create a definition of the character of an entrepreneur and ultimately what an entrepreneur is.

There are many definitions of the phrase “what is an entrepreneur?” and many scholars have developed their own opinions, definitions and theories on what they believe to be an entrepreneur. Few studies have employed the same description of an entrepreneur. Looking online, Dictionary.com defines an entrepreneur as:

“A person who organizes, operates, and assumes the risk for a business venture.”

In one attempt at defining entrepreneurs, Peter F Drucker quoted:

‘The entrepreneur always searches for change, responds to it, and

exploits it as an opportunity.’

Roy Ash, co-founder of Litton Industries, added :

‘An entrepreneur tends to bite off a little more than he can chew hoping

he'll quickly learn how to chew it.’

Timmons cited that entrepreneurship is:

‘The pursuit of opportunity without regard to the resources currently under one’s control or influence”

Joseph Schumpeter’s definition of entrepreneurship mainly focused on innovation and the creation of new products, new markets, new production methods and new types of organisations, which he labelled as the business cycle. Schumpeter believed, that new innovation led to ‘creative destruction’, which caused old stock, ideas, technology and skills to become obsolete. However, he alleged that creative destruction would lead to continuous progress as a period of recession would lead to a positive boom period which would ultimately improve the standards of living for everyone involved. He cited that entrepreneurship occurs when there is a period of stability within the economy and the market. Schumpeter believed his version of an entrepreneur to be ‘heroic.’

It can be said that entrepreneurs tend to be motivated not only by financial rewards but by the independence of owning their own business too. It has been found that many entrepreneurs do not work well with others and find working alone a more rewarding and fulfilling experience. Nevertheless, there is still no conclusive, common definition that is standard in the field of entrepreneurship. These propositions do, however, figure greatly in the study of entrepreneurship and does provide the basic form and background when establishing who and what is an entrepreneur.

Known as the “fundamental attribution error,” it has been suggested that an entrepreneur who is successful has a number of personal abilities and characteristic traits that have led to their success rather than the ideas of luck and being in the right place at the right time. It follows that, developing a set “personality profile” is almost impossible, as each entrepreneur possesses characteristics that are different to each other and will all have different methods of achieving success within their own businesses.

‘A “psychological profile” of the entrepreneur assembled from these studies would portray someone larger than life, full of contradictions, and conversely, someone so full of traits that s (he) would have to be a sort of generic “Everyman.”

Hornaday in 1982 identified more than 40 personality traits associated with entrepreneurs. The most popular, however, included the need for achievement, risk-taking, the need for autonomy and independence and a high internal locus of control. It has also been established that entrepreneurs have a higher tolerance for ambiguity and stress. Studies however have found it difficult to link these certain traits to an entrepreneur’s behaviour.

It is also difficult to establish whether