A question asked recently in a group of entrepreneurs in Wuhan made me ask myself if I was a businessman or an entrepreneur. Someone asked “I need a short explanation of differentiating between Entrepreneur and businessman. Sometimes I feel hard to explain this to people. Help me define these two”.
Very often we get confused with the difference between a businessman and an entrepreneur. Often the two words are used interchangeably. Solopreneur on the hand isn’t a brand-new term but it has definitely become more relevant in recent years. As an increasing number of professionals choose to start a business with no intention of ever adding staff, solopreneur is likely a term that will only grow in popularity.
Let’s start by defining who a businessman, an entrepreneur and a solopreneur really are;
Who is a businessman?
A person who is engaged in carrying out any activity, related to commercial and industrial purposes. A businessman faces tough competition because there are hundreds of rivals already existing in the market undertaking the same business. Although the risk factor is low because he/she walks on a path that is already tested by the rivals so the chances of failure are relatively low.
Who is an entrepreneur?
An Entrepreneur is a person who conceives a unique idea or concept to start an enterprise and brings it into reality. He/she is the person who bears risks and uncertainties of the business. Entrepreneurs are known for their creative approach. They introduce innovatively and coordinate the resources. They offer such products and services which bring about a change in the world.
Who is a Solopreneur?
A solopreneur is also a business person who sets up and runs a business and is responsible for its failure or success. However, solopreneurs do something completely opposite to entrepreneurs they focus on self-management in the first place, so once there is a task to do, they roll up their sleeves and get their job done. Of course, even a solopreneur needs to delegate certain tasks at times. However, this is usually temporary and most done by outsourcing.
Now that we know who these three people are, let’s differentiate between them. I will group them into two by differentiating between a businessman and an entrepreneur and also differentiating between an entrepreneur and a solopreneur since often a businessman and an entrepreneur are used interchangeably and an entrepreneur and a solopreneur are also used interchangeably.
A Businessman vs. An Entrepreneur
What distinguishes a Businessman from an Entrepreneur is the mental model (way of thinking): a Businessman is more an ‘Analytical Thinker’ while an Entrepreneur is more a ‘Possibility Thinkers’. A businessman walks on the defined path, but an entrepreneur believes in making his own path, which becomes a guideline for other businessmen. Most of the people have a misconception that the terms businessman and entrepreneur, carry the same meaning, due to which they use them interchangeably.
- A businessman is a person who runs the business, undertaking an unoriginal business idea. On the contrary, an entrepreneur is someone who first initiates a product or business idea and thus the leader of that in the market.
- Businessmen take calculated and managed risks. They cannot afford to lose money and suffer from bankruptcy. That is why they always do the Math when it comes to business. Entrepreneurs are like skydivers. They take crazy risks. They often don’t care about losing time and money just to pursue their passion. But since they do it with love, joy and passion, they often gain extraordinary rewards. Entrepreneurs, since they do the things they love the most, they do it to the best of themselves, resulting to greater success.
- A business owner tries hard to beat his competitors and win the competition. He also considers cooperation rather than competition to achieve certain goals. An entrepreneur tries hard to beat his worst competitor – himself.
- Losing money is one of the biggest worries of businessmen. Most business owners rely on a good economy to start, operate and attain success in business, especially in the retail, franchising and financing industry. Entrepreneurs do not worry a lot about money since they can always start from a scratch. Some entrepreneurs don’t really care about money at all.
- A businessman sees the world as an opportunity. He sees it as an opportunity to make a living. He also sees it as an opportunity help the people living on it. An entrepreneur sees the world as a duty rather than an opportunity
An Entrepreneur Vs. A Solopreneur
The differences between solopreneurs and entrepreneurs can be subtle, especially since some entrepreneurs work alone until they can build their businesses enough to make a team. However, those who choose solopreneurship over entrepreneurship without plans to change have distinct differences. While there are a number of differences, the four major differences between solopreneurs and entrepreneurs are:
Entrepreneurs are all about the start-up process. It’s where they typically add the greatest value, because of their creativity and vision. But they don’t always stick around to run the business long-term. Once it’s running smoothly, they often exit to start another venture.
Solopreneurs, on the other hand, start businesses to fit their desired lifestyle and, in many cases, to pursue a personal passion. They have little interest in building an empire or a business they can sell off. They want flexibility and control, and they’re happy to stay focused on growing the company they started.
The role of an entrepreneur is often as manager, whether that entails managing human resources, finances, equipment, or other business assets. Entrepreneurs often delegate tasks they know are not their strength.
Solopreneurs are typically more technician, or worker, than a manager. They are very good at what they do and prefer to get the job done themselves. Rather than taking the time to explain to someone else how to complete a task, they’d rather just roll up their sleeves and do it on their own. Managing their time is their biggest challenge, and opportunity.
Entrepreneurs are more likely to create brands that are distinct from their own personal identity than solopreneurs, and that affects the marketing methods they rely on. Entrepreneurs are more likely to invest in advertising, email marketing, and to use more sophisticated marketing tactics.
Solopreneurs, who are more focused on getting the work done, have a harder time squeezing marketing in. They are also less likely to invest large sums in marketing campaigns, relying instead on networking, social media, and word-of-mouth.
Entrepreneurs generally work to create businesses that can easily ramp up or scale. They develop systems that enable the company to quickly expand.
Solopreneurs, however, are less interested in growth beyond what they themselves can handle. They’re less interested in scaling.
Solopreneurs are entrepreneurs, but their business methods are often different because of their focus, which is on building a successful business they can run themselves.
When you’re the boss of your own business, you have the freedom to choose what to call yourself being it a businessman, an entrepreneur or a solopreneur. So before you order that new sign or box of business cards, think carefully about how you want to present your business to yourself and to the public, now and in the future.