One could obviously characterize these as the local business owners or restaurateurs with which you are probably familiar, the people who are in business to have a business. I want to distinguish these from the entrepreneurs who are in business to make a living; these are the people who do what they love because it’s who they are. Knowing if YOU are this type of entrepreneur is critical to your success as that knowledge helps you identify where and how to engage your community. Your personal brand is your business; your customers come from your community.
Don’t misunderstand this approach to be limited to small business owners. Large companies can too have a business owner at the helm. Was Dell best characterized as such? How about Ford, when Henry Ford helped invent manufacturing? I’m sure you’ve heard of one of the most famous business decisions in history? Ford’s decision to raise the working wage of his employees. Hold on to that thought because it could be argued that Ford epitomizes the “business owner” but it could also be said that Ford epitomizes the 4th type. I didn’t say we figured out all the answers to this idea over coffee, only that it was a thought provoking conversation that I’d like to continue.
Many entrepreneurs start their own venture knowing (or believing) that they can make a good living. Is your motivation that living? You may be inventing a new piece of software or building a world class sales organization; regardless, if your interest is in paying yourself, have that conversation now.
By contrasting the two, we can better see how this likely is the root of success in entrepreneurship. If you are a venture capitalist, ready to invest millions in the idea behind the business founded by an entrepreneur seeking a comfortable living… what does that tell you? Of course, the “business owner” is also going to pay his or herself but the business owner is focused on owning that business; in spite of the costs or returns, it’s who he is. This entrepreneur does this for a living and that motivation drives the success of such ventures.
It might be said that consultative ventures are driven by entrepreneurs with this spirit; ventures wherein value can clearly be created, delivered, and returned. With such clarity, these entrepreneurs attract the right talent to their team, set clear expectations with clients and customers, and excel.
A step removed from the business owner making a living is the founder looking for a return. An exit. Most startups, perhaps, fall into this characterization: brilliant entrepreneurs who have identifies a market gap they can fill more efficiently than the incumbents and corporations now too slow to innovate. Build your MVP, grab a share of the market, and get the attention of suitors.
You might argue that this is the type of entrepreneur that encourages everyone else. These entrepreneurs show that it’s not only possible to be successful, it’s attainable. But again, weigh the pros and cons: if you are a VC looking to evolve an entire industry or you are the best data architect in your field, you may not want an exit; you may not want the work to cease before the potential you believe exists is fully realized. Are you as likely to be drawn to the entrepreneur who wants to get something in market and exit when sufficient value is created? No, because you fall into the forth category…
Imaging the reaction to market validation of something like twitter… sitting in a coffee shop and asking people if the venture was a good idea. Really?? Why would I share the nuances of my life in 140 characters or less? What’s the business model?? Have you ever thought of how Google started? Or go further back and explore why Jerry Yang and David Filo started Yahoo! Because they wanted to.
There is a class of entrepreneur that just wants to do. Raising capital is merely a means to that end, not validation nor even necessary, for most. These are the entrepreneurs who aren’t really even building a business so there is no business at which to fail, no market that needs to be found. They are the individuals who live and breath their livelihood; like the first group, they are their business, and yet, these aren’t of their business - their business is a side effect of their ambition. Of course, it’s easy to muddy the boundaries of these definitions; I’m sure could argue that Ford was just as much a 2, as a 1, or 4. Is Elon Musk, with his ambition for space, a four or a brilliant one who can’t help but create incredible businesses where gaps and opportunities, obvious to him, are clear?