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What is an "entrepreneur"?

Small Business And Entrepreneur Basics

William A. Cohen (Author & Founder, Institute of Leader Arts) gives expert video advice on: What is an "entrepreneur"?; What are the skills I need to be a successful entrepreneur?; What are the key steps to being a successful entrepreneur? and more...

What is an "entrepreneur"?

An entrepreneur is someone who takes responsibility for a business, manages it and builds it. Sometimes an entrepreneur purchase the business and sometimes they start it. It doesn't make any difference. They're responsible for that business. I like to add one thing to the common definition and that is that they have some vision about where that business is going to go. You can be a small business person and start a restaurant and that can be entrepreneurship. If you have a vision for building that restaurant or expanding it in some fashion, you're an entrepreneur. I add vision to the basic definition of entrepreneur.

What are the advantages and disadvantages of being an entrepreneur?

Disadvantages? Well, I have to tell you that there are some, but I'll go with the advantages first. You're your own boss. You're running the show. You say you don't like how much they're paying you? They're not paying you enough? It's okay: from now on you set the salary. So you're running the whole thing, and that's a good feeling. It's your control and your baby. You can watch it grow. Those are a lot of the advantages. Now, the disadvantages: Well, you may have to meet a payroll. Being responsible means you are responsible, and as I said earlier anything that can go wrong will go wrong. That's not just a saying, that happens. And so you're responsible for everything, and you have to figure out ways to do things that maybe you've never done before. And if things go wrong, you get hit for it. If you make a mistake, if you lose a good person because you lost your temper with them, make a mistake, a financial... man, you feel it. And by the way, I forgot to mention the long hours, that's a disadvantage. Now on the other side, I have to tell you too that the advantage is, well, you can become a Donald Trump, or better.

What are the skills I need to be a successful entrepreneur?

With small business and entrepreneurial basics, the more skills you have the better you have at becoming a successful entrepreneur. I mean that's why I say when you're talking about a particular business, it helps if you like it and know something about it. That's good, that's a skill, but everything that you can bring to the table is an advantage. Persistence is very important and you have to be a self starter. The alarm goes off in the morning, you know you have to get up and go. People say well I'm not a good sales person, you can learn to be a good sales person. With all these things, I don't think there is anything that you cannot learn. There's very little that you can't do which you can't at least improve on, so even though you enter things and may say “I don't know how to do this” or know how to, you can learn. You can do it and you can develop.

Do I need a Master's in Business Administration to be an entrepreneur?

No of course not - in fact I have to tell you this; I had a guest speaker one time who was a sucessful entrepreneur who did not have a Bachelors Degree, and during the break hes says confidently "I don't want my kids going to college." I said "why not?" He said because it teaches them in a certain fixed way. I don't believe that. I think that the more you learn the better, but you dont need a Bachelor's Degree; you dont need any degree, and I can give you a number of examples of really successful entrepreneurs that just never did go to school. One comes to mind Joe Cosby, who's a good friend of mine; in fact we even did a book together. He's a guy that, he sold like two million ant farms. It's a product that was sold in the early 60s. Still people know, "an ant farm? oh yeah, I've heard about the ant farm." These are ants in a toy container. Joe had no college at all; he made millions of dollars and then went back to school and got a masters degree. Mary Kay Ashe, another woman who did a wonderful job. Started out Mary Kay Cosmetics, she's the one who gave away the pink cadillacs and all these things. No education whatsoever, she did these things none whatsoever, except self taught. so long anwer to short question "Do you need a master's. No if you need specialized knowledge you can get it from somebody. You can buy it' you can buy consulting or whatever you need; you dont need it yourself. you have it? Wonderful, good, like I said it doesn't hurt you or anything. You don't need it though.

What is a "small business"?

With small business and entrepreneurial basics, a small business is any business that doesn't dominate its particular market, institute or segment. If you had a launderette for example, that's a small business. Now, if you start building that launderette and it becomes the number one laundry in your city, then it's a different light. It's very difficult to define what small business is in lot ways, I can't define it, but I know one when I see one. The US Small Business Administration, for example, they have certain criteria and they say if you have so many people and so much money, this is a small business. So, you can have all kinds of artificial definitions put on it. But basically, if it's not dominating any particular segment, then it's a small business.