Not all entrepreneurs are the same. Using the insight of Steve Blank, perhaps the modern day father of entrepreneurship, and a few other industry experts, we have identified five predominant types of entrepreneurship:
Let’s explore these in more detail.
Workin’ hard or hardly workin’? (Source)
An overwhelming number of entrepreneurs are classified as small businesses. These businesses are predominantly focused on making enough money to look after their lifestyle, feed their family and make some sort of profit along the way. They don’t intend to take over a specific industry and, because they aren’t intended to scale and attract venture capital, they usually end up funding their business through friends, family or small business loans. They tend to be a one-woman or -man show, and while they might not be on the front page of the latest Forbes magazine, they certainly play a prominent role in the development of a local economy.
What is venture capital? Firms or funds provide financing to small firms that are still in the early stages of development but have high growth potential (and often high risk).
There’s no reason you can’t enjoy your job! (Source)
An increased number of startups are blurring the lines between passion and profession. Lifestyle entrepreneurship tends to be adopted by individuals who turn their passion, such as surfing, into a profession, providing surf lessons to locals and tourists. Not only does this form of entrepreneurship afford them an opportunity to make some money, but they get to do what they love on a daily basis.
Scalable startups start small, but know they can grow (Source)
Unlike small businesses, scalable entrepreneurship involves starting a company knowing from its very inception that it could change the world. They tend to attract funding from venture capitalists and commit to hiring the best and brightest minds. Their focus is on developing a scalable business model that will require more funding to enable them to expand rapidly.
Social Entrepreneurship word cloud (Source)
Unlike other types of startups, social startups tend not to be driven by profit. Instead, they establish their business with the intention of solving social problems or effecting social change. Social entrepreneurs apply a business-oriented focus to their startup and are as passionate and focused on success as any other entrepreneur. While profit isn’t the driving force behind these ventures, that doesn’t mean they don’t welcome wealth creation as well.
Regardless of whether you’re focused on becoming a social entrepreneur or building a company that gets sold for billions and listed on the stock exchange, the only way you’ll be able to start this journey is by identifying a burning opportunity and finding an idea that is desirable, viable, and feasible. Somewhere in the middle of these three requirements sits an innovative idea that will hopefully help you launch your business.