Imposter syndrome. Self doubt. The urge to give up. You’ve likely experienced these feelings at some point in your working life. If you’re lucky, you’re surrounded by people who affirm your talents. But what if you’re a company of one?
Since the beginning of time entrepreneurs have taken on risk, invented new technologies, and supported their communities—often alone on their uncertain path. But the rewards outweigh the risk for these innovators and dream chasers. They’re building a future on their own terms. And, they’re giving back: in 2022 alone, entrepreneurs in Shopify’s ecosystem contributed to 5.2 million jobs worldwide.
What is entrepreneurship? What makes a person an entrepreneur? Ahead, explore the meaning of entrepreneurship, what it takes to become a successful entrepreneur, and how you can leverage your unique strengths to establish a path to being your own boss.
What is entrepreneurship?
Entrepreneurship is the pursuit of starting, managing, and scaling a business. It involves combining innovation, skills, and vision to develop new products, services, or ideas that meet market demand and create value for a target audience. Those who choose this path often take on financial risks and require resilience and problem-solving skills. Entrepreneurship also applies to other types of self-employment, such as online content creators and consultants.
What is an entrepreneur?
An entrepreneur is someone who starts and runs a business, maybe taking on financial or personal risk in the process. But this description ignores the more nuanced aspects—the passion, the grit, the desire to bring ideas to life, the drive to solve a problem. Entrepreneurship is as much a mindset as a vocation.
The definition of an entrepreneur isn’t bound by a particular set of personal traits or actions. The term entrepreneur can be applied to a number of entrepreneurial ventures, from side hustlers and product developers to freelance writers and YouTube influencers. Anyone making money through independent pursuits can be considered an entrepreneur.
What is entrepreneurial mindset?
Entrepreneurial mindset is a combination of beliefs, knowledge, and a way of thinking that allows you to approach challenges, act on ideas, and balance risk. It can be achieved regardless of your innate strengths. Personal growth exercises along with trial and error will help build your entrepreneur muscle.
Why are entrepreneurs important?
Entrepreneurs are key players in the global economy. They are pillars of their communities, contributing to the local economy and helping other businesses thrive in their wake. New ideas often start with entrepreneurs who usually are more nimble than large corporations at reacting to trends and advances in technology.
This flexibility means small business owners can also adapt to sustainability trends more quickly, often making them leaders in their industries in areas such as energy efficiency and ethical manufacturing. Social entrepreneurship is another driver of change as business owners use their profits and platforms to support and bring awareness to social causes.
Pros and cons of entrepreneurship
In the entrepreneurship game, there’s no reward without risk. Those who understand business risk management have a better chance at reaping the rewards. When assessing whether entrepreneurship is an option for you, review the pros and cons before taking the leap.
Pros of entrepreneurship
- Gain work flexibility. Entrepreneurship means self-employment, which comes with the ability to set your own schedule and work where, when, and how you want.
- Make money doing what you love. Why wait until after work to do what you enjoy? Entrepreneurship opens doors to transforming a hobby or passion into a career.
- Be your own boss. Entrepreneurs have much more control of their businesses, with the ability to make decisions quickly.
- Maximize creativity. Without the barriers of bureaucracy common in large, mature companies, entrepreneurs can solve problems creatively and experiment often.
- Enjoy unlimited earning potential. The sky’s the limit when it comes to what you can earn, as you’re not bound by salary caps or bands common to some businesses.
Cons of entrepreneurship
- Take on financial risk. Becoming an entrepreneur means putting money on the line for your idea. If it doesn’t work out, you’ll be responsible to investors and lenders.
- Work long hours. Getting your idea off the ground often requires working long, hard hours while wearing many hats.
- Assume greater responsibility. As the leader of your own business, everyone will be looking to you for vision and direction, which can lead to personal stress.
- Face high competition. Entering any industry means catching up with those who came before you or beating other entrepreneurs to market with new ideas.
- Forgo the steady paycheck. While successful entrepreneurs may see a big payday, it won’t happen overnight. In the meantime, expect lean times as you invest your income into growing your dream.
As an aspiring entrepreneur, it’s important to weigh the pros and cons. Even the most successful entrepreneur has endured challenges. If you’re looking to turn an innovative idea into your own business, read ahead to discover the traits and requirements for finding success as an entrepreneur.
Types of entrepreneurs
Entrepreneurs can be grouped by their personality type, their entrepreneurial motivations, or the type of business they engage in. Aspiring entrepreneurs aren’t bound by the traditional definition of the term. Here are just a few of the types of entrepreneurship paths you can take.
Small business owner entrepreneurs
This classic profile that comes to mind when asked, “What is an entrepreneur?” The small business owner is often a solopreneur or leads a small team that runs a business of any kind, from a boutique legal practice to an ecommerce dropshipping store.
The innovator is an entrepreneur that brings a new idea, service, or product to market—or an improvement on any of those things. An innovative idea could spin into a new business venture or a patent, or be sold to another business.
These are self-employed entrepreneurs usually with deep expertise in a specific topic or industry. They are entrepreneurs because they work for themselves and get paid through client work, advising businesses and individuals on topics such as interior design or investing.
Many entrepreneurs get their start by running their own businesses on the side while working a full-time job. The motivation may be to pursue a passion project, make extra money, or test the waters with a small business idea before taking the plunge. Many successful entrepreneurs have built a full-time business venture out of a side gig.
Those looking to build their own business from a hobby or passion are often considered maker entrepreneurs. They are skilled at that craft that becomes a small business, making and selling handmade goods or creating online courses to teach DIY techniques.
The term “creator” today is most often used to describe online content creators, influencers, and personalities who make a living through self-employment. These entrepreneurs monetize their loyal audience through a number of means, including sponsorships, merch sales, and paid subscriptions.
Entrepreneur type quiz ⭐
What kind of entrepreneur are you? Tell us a bit about yourself to uncover your entrepreneur personality type and get advice specific to your motivations and strengths.
How do you become an entrepreneur?
If you’re interested in starting a new business venture, bringing a new idea to life, or taking the path to financial independence, you’ve already completed the first step! Your entrepreneurial mindset is kicking in, and you’re ready to take the next steps to becoming an entrepreneur.
First steps to starting a business
The best way to get started is to create a business plan. A business plan template can help you answer questions about the viability of your idea, how you will fund it, and the best marketing strategy to reach your target audience.
Once you’ve landed on your idea, established your business model, and identified your market, you’re ready to seek funding. Many use savings to start businesses on the side, but you can also consider crowdfunding, pursuing venture capital, seeking potential investors, or researching small business loans.
Depending on your business model, you may need to source inventory, secure a lease, hire staff, or develop a shipping strategy. The steps to getting started differ for each entrepreneur. After you’ve put together your brand strategy and built your website, you’re ready to launch and market your business to the world.
📕 Learn more: How To Start a Business in 11 Steps
Entrepreneurship requirements: what you need to get started
As an aspiring entrepreneur, it may feel daunting to take the leap into being your own boss. There’s a lot to learn as you build your business. But don’t worry if you don’t know everything about launching a brand or running a successful company. There are a few key elements to have in place—and the rest you can learn as you go.
You will need:
- An idea. Whatever your idea, be sure you can validate it through market research.
- Passion. Entrepreneurship can have its ups and downs. Make sure you believe in your idea and vision so you can see it through the bumps in the road.
- Start-up funds. Depending on your idea, you may be able to start a business from home with little upfront investment. Otherwise, find out how much you need to get your business off the ground.
- Willingness to learn (and fail). Many famous entrepreneurs don’t have degrees from business schools. And you don’t need one either. Be willing to learn from your mistakes and push through when you fail.
7 reasons to become an entrepreneur
Entrepreneurship is viewed by many as a preferable option to working for another company. While it often requires hard work, a certain amount of risk, and forgoing a steady paycheck, many find success in pursuing a passion or a world-changing idea. Here are just some of the reasons to become an entrepreneur.
1. Develop your skills
Entrepreneurs often start solo, meaning they manage every aspect of their business. Starting a business is a crash course in marketing, product development, customer service, web design, and more. The experiences in the first few months and years of running a business are priceless—and portable.
2. Build a business around a desired lifestyle
Business coach Nora Rahimian reminds her clients to build entrepreneurship around the life they want, rather than the other way around. One of the main benefits to starting a business is the flexibility it offers around working hours. “I can work at four in the morning. I take my dog to the park in the middle of the day. I can be responsive to what my brain needs from me,” she says.
💡 Tip: Love to travel? Start a seasonal business that lets you take months off at a time. Have a family? Set your work hours around your kids’ baseball games and spring break.
3. Generate a sustainable income
The early stages of running a business may result in mixed success, but pushing through is a great way to build a long-term, sustainable income source. This is especially true for those slowly building a business on the side as they transition out of full-time work.
Diversifying income is a central pillar of the FIRE movement, a popular saving and investing strategy for financial independence. Many entrepreneurs pursue a business idea for the promise of retiring early or the unlimited salary potential of being your own boss.
4. Call the shots
Getting a seat at the table can be tough in a corporate environment, but as your own boss, you call the shots. Those with leadership skills and strong opinions thrive as heads of their own companies. Entrepreneurship gives you the freedom to build the company, products, and team culture you want.
You run your business your way, making decisions on everything from how you raise money to the values that guide your brand to the flow of day-to-day operations.
5. Positively impact your community
Entrepreneurship drives job creation and economic growth in communities, and the success of one business can have a ripple effect to others in the area. Studies show that for every $100 spent at small retail businesses, $63 is circulated back into the local economy (versus $14 for multinational chains). And, in the US alone, more than 1.1 million jobs are created by entrepreneurs in their communities. Promoting economic development through running a successful business helps others do the same.
6. Promote social change
As consumer trends skew more and more toward support for sustainable business practices, small businesses are in a better position to get on the right side of history. Startups are nimble enough to make ethical and sustainable choices from the get-go. History shows that entrepreneurs create change because they are seen as leaders in their communities.
Social entrepreneurship is a rewarding endeavor for those with a passion for a cause or a desire to make change in the world. Small businesses can make a big impact, steering trends that pressure established firms to follow suit.
7. Define success for yourself
A successful entrepreneur isn’t always defined by monetary success. In entrepreneurship, you set your own goals and your own measure of success. Maybe success to you means brand recognition, market share, customer loyalty, or your ability to support a charitable cause.
What are the characteristics of successful entrepreneurs?
While there are certain traits that are common to many successful entrepreneurs, no two are created equal. Every personality type demonstrates strength in specific areas, each with a unique superpower that defines how they run and think about their businesses.
Top entrepreneur traits include:
Meet a few successful business owners who embody these traits.
Discipline: Cassey Ho
After moving across the country, Cassey Ho began filming workout videos to connect with her old students in California. Within months, her YouTube channel, Blogilates, started growing. Her new fans were demanding t-shirts and merch to support her channels.
After a few false starts and battling copycats, Cassey launched her DTC brand, POPFLEX, selling fitness gear and workout outfits directly to fans, and through an exclusive partnership with Target.
Vision: Emily Miller
Emily Miller’s passion for breakfast led her to imagine a cereal brand designed for millennial and Gen Z customers. While the cereal industry is dominated by large legacy brands, her vision for a cereal line that would speak to her target audience translated into sales. Emily had confidence in her vision, bringing OffLimits to life through a series of inclusive mascots. “Embrace being creative and weird. Take an approach of, ‘If you don’t like it, we don’t care,’” Emily says.
Passion: James Hoffmann
James Hoffmann describes his interest in coffee as a “full-blown obsession.” His career began when he was demonstrating espresso machines at a department store. From there, he struck out on his own, opening a roastery, acquiring a café, and launching a YouTube channel that now boasts almost two million subscribers.
Risk tolerance: Sonja Detrinidad
Sonja Detrinidad left a long career in the mortgage industry to take a chance on her business idea. With stress from her professional life mounting, Sonja took up gardening as a hobby, documenting her plant sourcing missions on social media. When her humorous and candid content went viral on TikTok, she quit her job to launch Partly Sunny Projects. “I thought, ‘Who’s going to want to buy plants during a pandemic?’” she says. “And the answer was: everyone.”
Self reliance: Natalie Gill
Natalie Gill started her fresh flower business from her apartment, relying on savings to bridge the gap after quitting her full-time job. She survived on little sleep and, at times, an $11 per week food budget. “I remember eating a lot of rice and beans,” she says. “I was only spending money on flowers, flower tools, and education, and business expenses.” But she persevered through the toughest points of her journey to build Native Poppy, a successful multi-location retail business.
Other helpful traits for entrepreneurs include perseverance, versatility, ambition, critical thinking, and attention to detail. Chances are you possess some of these qualities. Lean into the ones that make you unique.
Maybe you’re risk averse but have excellent discipline and attention to detail—your strength will lie in building a steady business with a solid safety net. Or maybe you’re not overly disciplined or focused on detail but you’re bursting with passion and vision—you’d make a great leader, bringing on skilled partners attracted to your ideas and enthusiasm.
5 entrepreneurship ideas for aspiring founders
Many entrepreneurs get their start by transforming a hobby or interest into their own business. Others stumble upon new ideas. And some are just born with it—an entrepreneurial mindset that drives them to solve the particular challenges of business ownership.
Would-be entrepreneurs can approach small business ownership in a number of ways. Ahead are a few ideas to get started.
1. Jump at the opportunity to invent something new
Opportunities are everywhere. Many new businesses come from the chance to do something completely new or put a creative spin on a classic. Look for opportunities in your daily life. How can you solve a common problem? Can you develop a product to simplify a task? Is there an underserved audience in a particular market?
👉 Start here: 7-Step Product Development Process Explained
2. Monetize your craft or passion
One of the most common inroads for aspiring entrepreneurs is focusing on what you do best, and building it slowly. You already understand the craft and the community that surrounds it—now turn it into a successful business venture. Consider how you might improve processes and scale handmade production. Think about the needs of your community and the problems you can solve.
3. Build an audience first, then become an entrepreneur
If you thrive in the company of people, start there. Use your natural people skills to build a following around your personal brand, grow an audience, and then monetize it. The growing creator economy has opportunities for charismatic young entrepreneurs to find niche audiences for content creation. Start a YouTube channel for craft tutorials, launch a comedy account on TikTok, or do beauty unboxings and reviews on Instagram. Monetize by selling merch or paid content to your loyal fans.
4. Build a business around a cause
If anything is going to tip you into the entrepreneurial pool, it’s your passion. Are there social or environmental causes that inspire you? There may be government programs or grants for a new business owner pursuing social entrepreneurship or launching sustainability initiatives.
5. Become an entrepreneur with a better way of doing things
The COVID-19 pandemic created opportunities to build new businesses around changing needs. Disruptors like Uber and Slack emerged from a recession. What recent events demand a new approach? How does the changing world present opportunities for a small business? Consider everyday items or processes and how you might evolve them to meet shifting consumer behavior.
The future of entrepreneurship
During the COVID-19 pandemic, entrepreneurial spirit surged. It offered a path for those looking to supplement loss of work, combat isolation or boredom, or react to opportunities created by changing consumer trends. And the definition of “entrepreneur” changed forever.
Technology has always propelled new forms of entrepreneurship. New and emerging technologies like AI may inspire fears around job loss, but these areas will likely open opportunities for new types of jobs—and more entrepreneurs.
Other social and economic shifts may necessitate diversified income streams, with more people pursuing entrepreneurship as a side gig. New career paths emerge constantly in the creator economy, too, with support roles like content consumers and creator managers offering more opportunity for those looking to make money online on their own terms.
Make your entrepreneurship dreams a reality
What is entrepreneurship? It’s whatever independence looks like for you. That might mean becoming self-employed as an online creator or starting your own small business. However you approach it, entrepreneurs create opportunities for themselves. With hard work and passion, you can design a future for yourself through entrepreneurship. It’s time to make your business idea a reality!
What does it mean to be an entrepreneur?
Being an entrepreneur means finding financial independence through starting a business or choosing another form of self-employment. An entrepreneur is often someone who takes on financial or personal risk to bring an idea, product, or service to market.
What skills do entrepreneurs need?
Skills that many successful entrepreneurs have in common are critical thinking, financial literacy, research skills, calculated risk taking, and people skills. Other skills can be acquired by trial and error while building a business.
What are the 5 types of entrepreneurs?
Entrepreneur types can be broken down in a number of ways. By personality type and motivation, entrepreneurs tend to fall into one of five groups:
What are the benefits of entrepreneurship?
- Develop your skills
- Build a business around a desired lifestyle
- Generate a sustainable income
- Be your own boss
- Positively impact your community
- Promote change through social entrepreneurship
- Define success for yourself
What are key elements of the entrepreneurial mindset?
- Creativity and innovation
- Motivation to succeed