Commerce · Ch 24 — Types of Entrepreneurs
Why Entrepreneurs Are Classified
Why Entrepreneurs Are Classified
An entrepreneur is a person who identifies a business opportunity, organises resources, and takes the risk of running an enterprise for a return. Entrepreneurs, however, are not a single uniform group — they differ widely in the kind of business they run, the technology they use, what motivates them, how fast they grow, how open they are to change, and the region or community they come from. Classifying entrepreneurs into types helps students, policymakers, and support institutions understand these differences and design appropriate training, finance, and incentive schemes for each type.
There is no single classification that captures every entrepreneur completely — a single person is usually a mix of more than one type at the same time (for example, a person can simultaneously be an industrial entrepreneur, a technical entrepreneur, and a rural entrepreneur). Commerce textbooks therefore classify entrepreneurs along several independent dimensions, or bases of classification, each answering a different question about the entrepreneur:
| Basis of classification | The question it answers |
|---|---|
| Type of business | What kind of economic activity does the enterprise carry on? |
| Use of technology | Does the entrepreneur focus on technical/production skill or on marketing? |
| Motivation | What drove the person to start the enterprise? |
| Growth | How fast and how far does the enterprise expand? |
| Stage of development / attitude to change | How willing is the entrepreneur to innovate or adopt new methods? |
| Area or region | Is the enterprise located in an urban or a rural setting? |
| Special or contemporary categories | Does the entrepreneur belong to a socially or economically distinct group (women, NRIs, social-mission ventures)? |
| Ownership | Who owns and controls the enterprise — an individual, a family, or an institutional structure? |
This chapter takes up each basis of classification in turn, with the specific types that fall under it.