What Is Entrepreneurship? A Guide

An entrepreneur is a person who starts a new business. Entrepreneurship is the process of starting and running that new business. In this article, we’ll discuss different types of entrepreneurship, the mindset that helps entrepreneurs succeed, and how entrepreneurship fits into our society and economy. We'll also go over ways you can explore entrepreneurship, whether you want to start your own business, discover career potential, or apply it to other areas of your life.

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What is entrepreneurship?

In addition to the practical aspects of starting a business, entrepreneurship can also be thought of as a mindset and lifestyle. To succeed in entrepreneurship, you need to keep learning, take action to achieve your goals, foster your passions, and connect to a sense of purpose.

Typically, two major characteristics of entrepreneurship are risk-taking and forward-thinking.

Risk-taking is the awareness that even though your business may not turn out the way you expect it to, you’re willing to make the effort anyway. Often, this willingness comes from weighing the risks against the potential rewards. Risks include losing money or competing against similar, more well-known brands. Rewards might include monetary profit and making a positive impact on others.

Risk-taking is inherent in any new business venture because businesses operate amidst some level of uncertainty. For example, market research may predict certain consumer behaviors, indicating a need for your service—but upon launching your business, you may realize the need wasn’t as great as expected.

Forward-thinking is tied to innovation. Many times, entrepreneurship is fueled by the idea of creating a better future. Consider these examples:

• A new product that could change the way people interact with the world

• A new process that changes the way businesses interact with consumers

• An improvement to the way a business operates within an established industry

• A mechanism that can make business better

Many business owners adopt a level of foresight about their business's potential to succeed. One thing that sets successful entrepreneurs apart from other business owners is the degree to which they consider the larger implications of their innovation style.

Types of entrepreneurship

Entrepreneurship can be further segmented into different categories that describe the organization or innovation driving the business. Four common types of entrepreneurship are small business, scalable start-up, large company, and social entrepreneurship.

Small business entrepreneurship

Small business entrepreneurship takes place on a localized level, without the expectation of wide-scale expansion. Examples of small business entrepreneurship would be opening a local restaurant, gift shop, or furniture restoration business.

Scalable start-up entrepreneurship

Scalable start-up entrepreneurship is a business largely guided by the idea of innovation that begins on a small scale with long-term plans for widespread growth. Examples of successful scalable start-ups include companies like Meta or Lyft.

Large company entrepreneurship

Large company entrepreneurship is a business sect launched within an established business. This can occur either with an acquisition of another business or the creation of a new internal division. Examples of large company entrepreneurship would be Disney’s acquisition of Pixar or Google launching Google Maps.

Social entrepreneurship

Social entrepreneurship places a heavy emphasis on creating societal change. The overall goal is to benefit humankind and our way of life, and it can occur on a local or global scale. Examples include Seventh Generation, a company guided by environmental responsibility, or Grameen Bank, a microfinance institution that provides collateral-free small business loans to fuel socio-economic development.

The importance of entrepreneurship

Entrepreneurship is important to society because it helps drive innovation across industries and different areas of life. In general, entrepreneurship moves us toward an improved state of being. Basically, when entrepreneurs take on risk, they can enhance their own lives and offer benefits to customers, employees, and communities.

As a business function, entrepreneurship also has close ties to the economy. Entrepreneurial innovations can fuel economic growth as businesses strive toward efficiency. As new businesses grow, they can promote job growth and create new opportunities for individuals to achieve career goals.

What is the mindset of an entrepreneur?

An entrepreneur mindset is a combination of attitudes, behaviors, and perspectives that can lead to success in the business world. This mindset includes risk taking and forward thinking, which we've already explored. Anyone can cultivate an entrepreneur mindset and apply it to business development or any area of life.

Let's look at some other components of an entrepreneur mindset:

Results oriented

Entrepreneurship works best when you set clear goals and know the outcomes you want to see in your business venture. That way, you can focus on the tasks and activities that will lead you to the results you want.

Visionary thinking

In addition to setting goals, entrepreneurs tend to envision the future and how their ideas can bring that vision into reality.

Leadership

Entrepreneurs are good motivators, decision-makers, and are proactive about setting the course for a business venture.

Read more: What Are Leadership Skills and Why Are They Important?

Resilience

The ability to rebound after setbacks, learn from each experience, and continue moving toward your goal is an important part of entrepreneurship.

Flexibility

As you navigate uncertainty in the business world, it's important to remain flexible rather than rigid in your approaches. There may be times when you may need to pivot or change course to stay ahead of the competition or meet unforeseen challenges.

Resourcefulness

Entrepreneurs have a knack for procuring the resources they need, including time, people, and money, to execute their ideas and, in many cases, finding ways to do more with less.

Customer focused

The needs of your customers should be at the center of any business strategy. That way, you can build lasting relationships and inspire customer loyalty, thereby helping your business thrive over the long term.

In considering entrepreneurship, think about how your business will impact the world outside of your immediate business processes. Broader perspective that incorporates the way your business will interact with your community, society, other businesses, and your industry at large is the difference between simply starting a business and taking on the mindset and behaviors of an entrepreneur.

How to explore entrepreneurship

Entrepreneurship as a mindset, lifestyle, and business endeavor is something that anyone can explore, no matter your background, education, or experience. Entrepreneurship can be a great way to explore your interests and career potential, even if you don't plan to start a business in the near future. Here are some steps you can take to explore further:

1. Cultivate an entrepreneurship mindset.

As we've discussed, mindset is a key part of what makes entrepreneurship a unique approach to business as well as life. Cultivating this mindset can help you achieve goals, handle setbacks gracefully, connect to your passions, and discover fresh opportunities everywhere you look.

2. Build entrepreneurship skills.

In addition to adopting the right mindset, building a powerful skill set and refining those skills over time can be useful in your entrepreneurship journey as you approach different situations. Some technical and workplace skills to prioritize include:

• Market research and analysis

• Project management

• Negotiation

• Financial literacy

• Sales

• Content marketing

• Tech skills

• ChatGPT prompting

• Using generative AI

3. Network with other entrepreneurs.

Networking and building relationships offer many benefits, including finding collaborators for different business endeavors, getting feedback on your ideas before you execute them, getting referrals, and discovering new resources and opportunities. To network effectively, consider attending business events in your area or joining a community of entrepreneurs to connect with like-minded people on an ongoing basis.

4. Collect helpful resources.

There are many resources that can make your entrepreneurship journey more rewarding, from ways to get start-up funding to courses you can take to build important skills.

To get started, check out some of our other articles on different business-related topics:

• Business Plan: What it Is + How to Write One

• What Is a Brand Strategy? + How to Create One

• 10 Small Business Bookkeeping Tips

• How to Start an E-Commerce Business

• The 4Ps of Marketing: What They Are and How to Use Them

• How to Create a Facebook Business Page: Step-by-Step Guide

5. Identify ways to apply your entrepreneurship skills.

Entrepreneurship offers many ways for you to explore your passions and potential beyond starting a business from scratch. Consider these ideas:

• Start a side hustle to earn extra money, such as selling your handmade jewelry or tutoring students.

• Land freelance gigs in your area of interest, such as graphic design or web development.

• Drive organizational change by taking on new projects and rallying coworkers around innovative ideas.

• Develop a personal brand on social media and connect your followers to brands you admire through influencer or affiliate marketing.

Read more: 15 Side Jobs to Earn Extra Money

Start your entrepreneurship journey with Coursera

One key to success in entrepreneurship is to never stop learning. Taking online courses can be a great way to pick up new skills and get inspired at your own pace. Sign up for one of Coursera's courses, designed to meet your needs:

For an introduction to entrepreneurship, consider SUNY's Launch Your Online Business course. It's free and can be completed in about three weeks.

To continue your journey toward entrepreneurship, consider the Entrepreneurship Specialization from Wharton. Through five courses, you’ll learn about the process of launching your own business with an entrepreneurial mindset.

Or, for even deeper learning, you may be interested in earning a Master of Science in Innovation and Entrepreneurship from HEC Paris.