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The New
Definition of Entrepreneur

Definition of Entrepreneur: How online and offline entrepreneurs differ and how they are the same is a compelling read. The new definition is surprising.

Most people think the definition is a person who has a profitable running business.

Risk is defined, from an entrepreneurial prospective, as taking a chance; either to win or to lose, or in this case to make money or to lose money.


The definition of entrepreneur is broad enough to include a phrase like, does not receive subsidized or free money to apply to the business undertaking. Sure an entrepreneur may take out loans or sell stock or a piece of the business to generate operational cash for his/her business operations, but this is eventually paid back to the bank or investor/stockholder.

I like the definition of entrepreneur to be simply stated: A person who starts and runs a business.

This definition does not imply that an entrepreneur is not one if the business fails or is one only is the business is successful.

Why?

Because, being an entrepreneur is an action.

It's an attempt at working toward a potential favorable outcome. If you fail, you were still working toward a positive outcome, but didn't make it.

Once you have the entrepreneurship bug, you may even want to try business opportunity.

Is the Definition Different when Applied to Online or Offline Businesses?

OFFLINE

Prior to the .com era, businesses were in offline or bricks and mortar settings. They had storefronts or offices.

An entrepreneur invested significant capital to start the business. These funds went for rent, advertising, utilities, staff and products.

In this model the definition of entrepreneur included not only the financial responsibility of cash flow, but also management of personnel, advertising, marketing and sales efforts.

In a small business, when it needed cash, the owner/entrepreneur took money from his/her savings. Often there was no salary, especially in the early years of start-up.

What the owner received as income may not have occurred until January or February of the following year after the books were closed and taxes paid.

Often the entrepreneur only made real money when the business was sold.

ONLINE

Within the last 8 to 10 years, the definition of entrepreneur has changed significantly.

The Small Business Administration estimates that 52% of all businesses are home-based, with most of those occurring online.

The landscape has now changed for the entrepreneur. The definition of entrepreneur still includes, a person who starts and runs a business, but no longer is there significant financial risk.

In fact, the risk factor has changed from financial investment to time investment.

Why?

  • The annual financial investment by an entrepreneur in an online business is usually $1,000 or less, usually less.
  • To build a Web-based business, a significant amount of time is required to build your website. Working either full time or part time, it may take you many months of sweat equity before any return is expected.
  • If you are selling down loadable products or tangible ones, your inventory cost is minimal and controllable.
  • The new entrepreneur has no rent, little, if any, advertising costs, no utility costs and no personnel costs. It's basically a one person or person and spouse/partner entrepreneurial effort. You accept all the risk (little), and keep all the profits for yourself. And, no matter if your a retiree , a stay at home Mom or a student, you can build a successful online business.
  • The new definition of entrepreneur means you are no longer a slave to your business, but now have family and social time to lead a much less stress-reduced life.
  • Your online service or product is available 24/7 and worldwide in scope. It works for you pretty much on "autopilot." After development of your online business, most entrepreneurs spend less than 3 hours a week maintaining it.

Yes, the nature of entrepreneur has certainly changed.

Entrepreneurship:
What hasn't changed?

The traditional offline, bricks and mortar business success was significantly determined by three elements: Location, Location and Location.

The concept might have been great, the product and service outstanding, but, unless store traffic was generated (mostly by location and the number of competitors of the business), success was highly doubtful.

The small business was limited by its neighborhood traffic or regional traffic, at most. Even being located in a large regional mall was no guarantee of success.


The same is true for the online business.

Nearly 99% of all websites do not generate traffic! That's a FACT! Yes, even if you pay a typical website development company to build your site, the same result--no traffic--is likely.

This FACT is the single hardest element for the new entrepreneur to get their mind around...and accept!

Why?

Generating online traffic is essentially the same as the old Location, Location, Location adage of the past.

Only on the Web, you have to be noticed by both humans and the search engines to achieve a page 1 or 2 ranking to get noticed by customers.

Let me ask you a question.

On the Web, do you go to page 3 and pages 4 through 16,684,092 to get the information you seek when visiting the Internet?

In reality 96% of web searchers only go to page 1 and less than 3% go to page 2.

This is why location of the Search Engines is so important.

I suggest learning how to judge any website builder you consider for your offline or online enterprise.


I trust this has been helpful.

Thank you for visiting The New Definition of Entrepreneur.


Helpful Professional Resources

The Entrepreneurs' Organization

The Family Firm Institute

International Franchise Association

Additional Entrepreneurship Articles


Suggested Home Business Ideas


 

 

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