The Different Types of Entrepreneurship

When you think about starting a business, Elon Musk, Jeff Bezos, or Richard Branson may be a few entrepreneurship examples that spring to mind. While they each have successful businesses, those three aren't your everyday entrepreneurs — think of the average coffee shop owner struggling to get their new venture going or the would-be entrepreneurs who are monetizing a favorite hobby by making it a side-hustle.


Knowing what the different types of entrepreneurship are when you're setting up a new business can help you get your priorities straight. But the kinds of entrepreneurship that exist vary, so which one are you?


8 Different Types of Entrepreneurs


There are generally eight entrepreneurship types. Here's a closer look at each one to help you figure out which one fits you best.


1. Scalable Startup


A scalable startup is a rapid growth company that invests heavily to reach mass market adoption in a large total addressable market. Entrepreneurial resources usually come from venture capital firms that understand the vision and the potential for huge profits down the line. Typically, scalable startup entrepreneurship aims to identify any problems that exist in the industry and develop brand new solutions for them.


With this entrepreneurship type, you'll commonly see a scalable startup popping up out of the woodwork and suddenly everyone will be talking about it. The startup can generate a lot of buzz simply because of its unmatched use case. Finding product-market-fit is crucial to all scalable startups that want to be successful. Once realized, you can dedicate time and resources to research while continuously benefiting from economies of scale organically.


There’s no better example than Tesla to describe a scalable startup that challenged the status quo. What started as an underestimated electric vehicle alternative to traditional internal combustion engine vehicles went on to become an international, multi-billion-dollar spectacle.



2. Small Business Entrepreneurship


Small business entrepreneurship is when you decide to start your own business, but the opportunities for huge growth may be more limited depending on industry or geography. This type of entrepreneur includes mechanics who open their own shop or a consultant who has specialized skills in tax compliance.


In this case, you don’t need to be good at everything. You just need to know your own local market. Usually, a small business entrepreneur will have one storefront and a handful of employees to keep it running but they don’t intend to open 100 new locations per year like a chain store would.



3. Solopreneurship


A solopreneur is similar to a small business entrepreneur, but instead of hiring full-time employees to take a load off, they go at it alone. As a solopreneur, you are the founder, CEO, HR department, and sales team all rolled into one — in other words, full management is on you. If you are a solopreneur, you might sometimes hire outside help through freelancers for certain tasks you’re not skilled in, but other than that, you oversee all operations yourself.


A solopreneur will target a niche market in which they have expertise, and this also comes with a variety of benefits. You don’t have the same infrastructure requirements as another business venture would. Many solopreneurs can operate using a work-from-home model, so there’s no struggle with staffing costs and every ounce of profit made goes right into their pockets. You will tend to have a variety of skills as a solopreneur and it’s becoming ever more popular as an alternative to traditional employment. YouTube creators, craftspeople selling their artisan wares on Etsy, or personal accountants would all be classified as solopreneurs.



4. Innovative Entrepreneurship


Innovative entrepreneurship is the process of using creativity for problem-solving, improving business activities, or finding a brand new way of doing things. Many would-be entrepreneurs are actually positioned for this role by their employers, too. Innovative entrepreneurs think outside the box and use methods that improve customer experiences, lower costs, and keep employees happy. You take a conventional process and use innovative ideas to make it better.


Airbnb is a great example. Co-founder and CEO Brian Chesky and his team reimagined how people could travel. Now, people all over the world are contributing to an ecosystem where travelers can book unique accommodation options.


Google is another company that displayed innovative entrepreneurship, developing its creative workplace culture over the years. Not only did it banish the traditional suit-and-tie approach to business but it also pioneered a whole new wave of staff benefits. Gym memberships, gaming rooms, classes for music and sport, multiple dining options, and even bowling alleys and massages became part of the employee experience. This positioning set Google up to be one of the most sought-after places to work for, and it still maintains that characterization today.



5. Hustler Entrepreneur


By now, you’ll all have heard of side hustles — a useful way to make a little bit extra on the side. But hustler entrepreneurship is slightly different as you have the ambition to grow. You show a huge scope of unique talents as a hustler entrepreneur and you don’t mind getting your hands dirty to learn new things. You rely solely on your own capabilities.


In this way, a hustler entrepreneur has to be adaptable and shows similar characteristics to a solopreneur — you take on a huge amount of responsibility yourself to get work done. Grit, hard work, determination, and stopping at nothing to get a job done are what really make a hustler entrepreneur stand out though.


You will take advantage of your own expertise to scale a business as a hustler entrepreneur, opting to do the majority of work yourself rather than getting a loan or other assistance. First, you start small, growing incrementally to become a larger company. Once your business is built up to a satisfactory point, you can begin to take the foot off the accelerator.



6. Imitating Entrepreneur


The imitating entrepreneur takes a copycat approach. You use someone else’s idea for your baseline but you make improvements to differentiate your product or service. You simply use other business ideas and strategic methods as inspiration, with the ambition to create a better company yourself. Some of the most successful entrepreneurs of our time have used this strategy for decades.


A classic example of imitating entrepreneurship has been portrayed perfectly in movies such as ‘The Social Network.’ The biographical drama tells the story of CEO Mark Zuckerberg's early days with Facebook. He actually drummed up his social media business based on the idea of the Winkelvoss twins who attended the same university.


Another telling tale brought to cinemas is that of ‘The Founder.’ It dives into the origin of McDonald’s, once a small-time business owned by two brothers which slowly was modified by Ray Croc to become a global success.



7. Buyer Entrepreneur


Buyer entrepreneurs utilize existing wealth to create further business opportunities. ‘Buyer’ refers to the process of purchasing other existing businesses. A buyer entrepreneur will target companies that have already proven to be successful or that are deemed to have future potential.


With major multinational corporations, it is often used as a method to expand footprints, acquire unique intellectual property assets, or act as a way to enter brand new markets. That being said, buyer entrepreneurship is visible on a smaller scale too. For example, a buyer entrepreneur in the real estate industry would purchase a new property to increase their total income. Similarly, a chef could choose to buy an existing restaurant for remodeling. Or a buyer entrepreneur in the ecommerce space could buy an existing Shopify store to save themselves work.



8. Social Entrepreneurship


Social entrepreneurship takes self-indulgence and personal gain out of the equation. It focuses on delivering real-world solutions for systemic social problems. Entrepreneurial activity has the overarching goal not to make a profit, but to give back to specific groups that will benefit from its efforts. An example of social entrepreneurship is the ‘Bill and Melinda Gates Foundation.’ The primary concern is the well-being of others, with an emphasis put on tasks such as sustainable economic growth and healthcare access for those in poorer regions around the world.



Fine-Tune Your Entrepreneurial Venture or Business Ideas with Noumena


You might be at the start of your entrepreneurial career or you’re looking to grow exponentially. You can use Noumena’s Capital Quotient (CQ) service to assess your business health and fund out where you can improve. Just beginning? No worries. CQ provides you with the business planning resources you need to get up and running.


Regardless of what point you are at, the Noumena app is a place for you to discuss your entrepreneurial journey. Noumena is a freelancers-only social finance app that allows you to meet like-minded people and discover brand new ideas you had never thought of before! Sign up right now to find out how you can build a better business.



References:

  1. https://www.investopedia.com/terms/e/entrepreneur.asp#:~:text=Small%20business%20entrepreneurship%20is%20the,example%20of%20small%20business%20entrepreneurship

  2. https://blog.hubspot.com/sales/solopreneur#:~:text=What%20is%20a%20solopreneur%3F,related%20to%20their%20business%20alone

  3. https://www.indeed.com/career-advice/career-development/innovative-entrepreneurship#:~:text=Innovative%20entrepreneurship%20is%20the%20practice,their%20competitiveness%20in%20the%20market

  4. https://www.indeed.com/career-advice/career-development/types-of-entrepreneurship#:~:text=People%20who%20are%20willing%20to,takes%20to%20achieve%20their%20goals

  5. https://www.protocol.com/bulletins/google-massages-return-to-work