Years ago there was a joke circulating about a statement allegedly made by a past American President: “the problem with the French is that they don’t have a word for Entrepreneur”. All jokes aside, what does the term entrepreneur really mean? Yes, its origin is French; however, that is just the start.
Marion Webster’s dictionary defines an entrepreneur as……one who organizes, manages, and assumes the risks of a business or enterprise.
Going back as far as the 18th century, when the agrarian society moved forward to a capitalist model, we saw the emergence of the Merchant Class. These were the shop owners who began as individuals selling their wares. Over time the scope of the word has continued to change.
Here is a chronological list of definitions going back to the middle of the eighteenth century.
• 1734: Richard Cantillon: Entrepreneurs are non-fixed income earners who pay known costs of production but earn uncertain incomes.
• 1803: Jean-Baptiste Say: An entrepreneur is an economic agent who unites all means of production – land of one, the labour of another and the capital of yet another and thus produces a product. By selling the product in the market he pays rent of land, wages to labour, interest on capital and what remains is his profit. He shifts economic resources out of an area of lower and into an area of higher productivity and greater yield.
• 1934: Schumpeter: Entrepreneurs are innovators who use a process of shattering the status quo of the existing products and services, to set up new products, new services.
• 1961: David McClelland: An entrepreneur is a person with a high need for achievement. He is energetic and a moderate risk taker.
• 1964: Peter Drucker: An entrepreneur searches for change, responds to it and exploits opportunities. Innovation is a specific tool of an entrepreneur hence an effective entrepreneur converts a source into a resource.
• 1971: Kilby: Emphasizes the role of an imitator entrepreneur who does not innovate but imitates technologies innovated by others. Are very important in developing economies.
• 1975: Albert Shapero: Entrepreneurs take initiative, accept risk of failure and have an internal locus of control.
• 1975: Howard Stevenson: Entrepreneurship is “the pursuit of opportunity without regard to resources currently controlled.”
The above definitions provide a philosophical dimension to entrepreneurship and illustrate how society has viewed entrepreneurship over the years. When embarking on a new venture, considering what it means to be an entrepreneur can provide personal insight into the way we see ourselves and our businesses.
Are you the entrepreneurial type? Start now by taking this entrepreneurial self assessment tool offered by The Business Development Bank of Canada. Check out our other resources or give us a call at the Halton Small Business Centre at 905-825-6000.