It is not uncommon to find people defining themselves as entrepreneurs, but it seems that they are often unclear on what makes them define themselves as so.
Are inventors and investors entrepreneurs?
Many inventors define themselves as entrepreneurs because they carry the creativity to come up with solutions to problems that others had thus far overlooked or were unable to solve. But often enough, those inventors fail to capitalize on their ideas, which can die on the vine quickly regardless of how powerful they are.
Many investors also define themselves as entrepreneurs, throwing capital around in hopes that some of it will land outsized returns by almost accidentally financing a good idea.
A true entrepreneur
To me, both pictures above fail to characterize a true entrepreneur. Let’s consider my preferred definition of entrepreneur: “An entrepreneur is someone who capitalizes on an idea.” Simple but powerful—let’s dissect it. First, it does not say that you have to invent anything. Yes, you have to start with an idea but it does not say it has to be yours! Recognizing a good, novel idea when you see one is half the battle. It also does not say you have to invest in it. It says you have to be able to capitalize on it—or create capital from it—but that can be achieved by aggregating funds from family, friends, and other investors to pursue the idea you identified.
Bringing together ideas and capital
Entrepreneurs need ‘inventors’ and ‘investors’ but they are a unique breed that bring together ideas (for emphasis: not theirs) and capital (for emphasis: not only theirs) with good (for emphasis: not great) execution and thus create capital and wealth from it. It wasn’t Warren Buffet’s ideas or capital that created Berkshire Hathaway. Or Bill Gates’ that created Microsoft. Or Steve Jobs’ that created Apple or Pixar Studios. Or Elon Musk’s that created Tesla or SpaceX. You get the idea. Entrepreneurs are rare, but what they have more than most is neither ideas nor funds—it is the drive to succeed.
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