Q.Who is an entrepreneur? Explain the meaning of the term.

An entrepreneur is the person behind a new enterprise, and the term captures three ideas at once.

The word comes from the French entreprendre, 'to undertake'. The entrepreneur innovates, organises the factors of production, and bears risk and uncertainty.

Meaning. The word entrepreneur comes from the French entreprendre, meaning 'to undertake'. An entrepreneur is, quite literally, one who undertakes a venture.

The three core ideas.

1. Innovation — the entrepreneur spots an opportunity others miss: a new product, a cheaper method of production, a new market or a new source of supply.
2. Organisation — the entrepreneur brings together the factors of production (land, labour, capital and knowledge) and coordinates them into a productive unit.
3. Risk-bearing — because the outcome of a new venture cannot be known in advance, it is the entrepreneur who accepts the possibility of loss in the hope of profit.

Related terms. The entrepreneur is the person; entrepreneurship is the process of setting up and running the enterprise; the enterprise is the business unit created.

Confusing 'entrepreneur' (the person) with 'entrepreneurship' (the process) or 'enterprise' (the business unit). Also, describing an entrepreneur as merely an investor or a manager — the distinguishing features are innovation and risk-bearing, not just providing money or running operations.