Meaning of Entrepreneur and Entrepreneurship

Every business enterprise begins with a person who is willing to spot an opportunity, take a risk on it, and put together the resources needed to convert that opportunity into a working business. That person is called an entrepreneur, and the whole activity of doing this is called entrepreneurship. The word 'entrepreneur' comes from the French word 'entreprendre', which means 'to undertake'. Historically the term was first used for a person who undertook the risk of a military or commercial venture on behalf of someone else; over time its meaning narrowed to the person who starts, organises, and runs a business enterprise, bearing its risk in the hope of profit.

An entrepreneur may be defined as an individual who conceives a business idea, assumes the risk and uncertainty involved in starting and running an enterprise, mobilises and organises the factors of production (land, labour, capital, and enterprise itself), and innovates in order to convert the idea into a going concern. The entrepreneur is thus the person — the human agent who notices a gap in the market, believes an idea is worth pursuing, and is prepared to stake time, money, and reputation on making it work.

Entrepreneurship, by contrast, is not a person but a PROCESS. It is the dynamic, ongoing activity of identifying a business opportunity, assembling the resources required, and creating value by setting up and running an enterprise around that opportunity. Entrepreneurship covers everything the entrepreneur does from the moment an idea first occurs to the continuous work of running, adapting, and growing the enterprise afterward. Put simply: the entrepreneur is the doer, and entrepreneurship is the doing.

This distinction — person versus process — is one of the most frequently tested ideas in this chapter and is examined in detail later in this chapter (see 'Entrepreneur vs Entrepreneurship').