Every entrepreneur is a business owner, but not all business owners are entrepreneurs. Well, most people don’t know this because they often use the two terms loosely. So, in this article, you will learn the difference between entrepreneurs and small business owners.
For instance, a small business owner may have fewer resources and generate less revenue than a medium or large size company. A small business owner doesn’t bring something new to the table; they take little or no risk and care more about profitability than providing solutions.
An entrepreneur, on the other hand, could be a small business owner. But they offer a product or service that solves a problem and disrupts an industry.
Entrepreneurs are risk-takers; they are innovators and problem solvers. Even though they want to make profits, it’s not their primary motivation. All they are concerned about is making a change and developing solutions to problems. And once they provide solutions, they will start earning exponentially.
So, here are some of the areas of difference between entrepreneurs and small business owners;
Areas of Difference Between Entrepreneurs and Small Business Owners
The biggest difference between entrepreneurs and small business owners is risk-taking. Entrepreneurs aren’t afraid to take risks. And sometimes, these risks pay off, and other times, they don’t.
Even though an entrepreneur may fail several times, they never stop taking risks. That’s because risk-taking is part of the appeal of becoming an entrepreneur.
You can’t succeed in your entrepreneurial journey if you aren’t taking risks. Several successful entrepreneurs you see today took great risks to get their businesses to where they are now.
But taking risks doesn’t mean you should run your business haphazardly and expect results. It involves planning and consistent efforts.
However, small business owners try not to take risks. They only run the business based on what they know. And they don’t try something new because of the unknown. That’s why small businesses’ growth is always limited; the owners don’t want the stress associated with risk-taking.
#2. Big Picture
This is also an area of difference between entrepreneurs and small business owners. Every entrepreneur sees the bigger picture of their business. They are futuristic and always develop a strategy that will help them achieve their long-term business goals.
The dream of every entrepreneur goes beyond profitability and community. They want to build a fortune 500 company from their small business.
Whatever business an entrepreneur runs, they always look at the bigger picture. It goes beyond what they want to achieve by the end of the year, and the revenue they want to make. It’s about building a world-class brand.
With these thoughts, entrepreneurs would be willing to take risks because they could see things from a broader perspective.
However, a small business owner doesn’t look at the bigger picture. They are more concerned about the day-to-day running of their business and satisfying their communities.
The height of a small business owner’s achievement is dominating the community in which they serve.
But when a small business owner starts looking beyond their community, they gradually become an entrepreneur.
Innovation is another area of difference between entrepreneurs and small business owners. A small business owner understands how their business works.
They know their business template and its day-to-day operations. There are established guidelines, and once they stick to them, their business will surely be successful in the future.
But that’s not how entrepreneurship works. As an entrepreneur, you must be innovative, creative, and smart. Otherwise, your business may not stand the test of time.
Entrepreneurs are creative; they think for their customers and always come up with the best ways to keep their audience engaged.
Several years back, there was a famous mobile phone brand – Blackberry. The brand had great potential and had a fair share of the mobile phone market.
However, they failed to repurpose the phone to meet the market trend. Blackberry got to its peak in 2013 with 85 million subscribers.
By 2016, the company reported a $670 million loss and exited the smartphone business.
In a nutshell, innovation is important in the entrepreneurial process. And any business that fails to innovate will be outsmarted by competitors in no time.
Scalability is another area of difference between entrepreneurs and small business owners. Every small business owner is emotional about their business. They won’t want to sell or hand over their business to another person until they are ready to retire.
It doesn’t matter how much you are offering. They love their business and aren’t willing to jump on the next big idea.
But that isn’t the case for entrepreneurs. Of course, one of their dreams is for their business to become a world brand.
But they may not be interested in the day-to-day running of their business. And most entrepreneurs don’t have any emotional attachment to their business. Most of them dream of selling their business one day and then jumping on the next big idea.
Don’t get me wrong, entrepreneurs and small business owners are both passionate about their company. But they do it differently.
For instance, a small business owner does what they do, and does not want to change the world or make a mark. Instead, they want to support themselves and their family.
However, every idea an entrepreneur is working on is tailored towards disrupting an industry, changing the world, making indelible marks on the sands of time, etc.
In a nutshell, money isn’t the primary motivation of entrepreneurs. All they want to do is make a change.
By now, I’m sure you understand the difference between entrepreneurs and small business owners. Even though they both run a business, their approach and motivation are different.