The True Meaning of 'Entrepreneur'
You don’t need me to tell you that leadership and entrepreneurship are all the rage these days. It sort of makes sense since they go hand in hand: Entrepreneurs start businesses and leaders run them, right?
That’s what I used to think.
The problem is that entrepreneurs and leaders have another thing in common: Neither one is actually a job. And that might very well explain why Millennials have all the makings of a great entrepreneurial generation but have failed to deliver on that promise.
It was fascinating to see an infographic comparing The Case For and Against Millennials as the Greatest Entrepreneurial Generation. In addition to being the most educated and business-savvy generation, there’s been quite a groundswell of media hype linking Gen Y with entrepreneurship, at least in theory.
Unfortunately, the Millennial generation is also the most indebted, unemployed, and underemployed in decades. Not only has the labor force participation rate plummeted among that age group, so has entrepreneurship. If that’s news to you, you’ll find more on the subject, including plenty of links to the data here.
While economists and statisticians might come up with all sorts of theories and excuses for this extraordinary gap between reality and perception, I’ve got a somewhat different take. I don’t think a lot of people understand the true meaning of the word entrepreneur.
My go-to online dictionary describes an entrepreneur as “a person who starts a business and is willing to risk loss in order to make money” or “one who organizes, manages, and assumes the risks of a business or enterprise.” Note the common keywords business and risk. If there’s no real business or risk, you’re not an entrepreneur.
The problem is all the media hype. First, there’s the persistent entrepreneurial drumbeat, not to mention the common memes that corporations are evil and you won’t get ahead working for someone else. And the growing trend toward government safety nets among western countries certainly doesn’t hurt.
So instead of getting a job and building a career, large numbers of people are finding ever-more creative ways of hiding the fact that they’re unemployed, all the while telling themselves it’s OK since they’re entrepreneurs building their brand, platform, presence, following, or some other such nonsense.
Look, you probably don’t want to hear this but if I don’t tell you, who will? Entrepreneur is not a job. Leader is not a job. Social media guru is not a job. If there’s no real expertise, no real product, no real business, no real risk, and no real prospect for return on investment, you’re not working. And you’re not an entrepreneur, either.
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If you want to be an entrepreneur someday, here’s an equation you should print out and attach to your mirror, computer screen, smartphone, or wherever your eyeballs spend most of their time:
Entrepreneur + Capital = Products + Customers = Business.
Don’t take my word for it. Look at every successful entrepreneur on the planet. That’s the equation that got them there.
Evan Spiegel is the CEO of Snapchat. That’s his job. It’s a real company with a real product, real employees, and real investors. And I bet what he really identifies with is the cool ephemeral messaging app the company he co-founded came up with. Which is how they managed to attract hundreds of millions of extremely engaged users and raise more than half a billion dollars in venture funding.
John Mackey is co-CEO of Whole Foods. Healthy food has always been his passion but the way he built his company – to serve all its major stakeholders – is unique. He wrote a book about it called Conscious Capitalism. I seriously doubt if Mackey thinks of himself as a great entrepreneur but as the co-founder of a great company that showed the world a new and better way to do business.
I can go on but I think you get the point. These guys have jobs. Real jobs. They have products. Real products. And they have real companies that do real business.
If you want to be a successful entrepreneur, don’t start out wanting to be one. Start out with a customer problem and a product that solves it. Get capital. Make the product, market it, win customers. Someday you’ll wake up and realize what you’ve become: a guy who took a risk, started a business, and made money. An entrepreneur.
Steve Tobak is a management consultant, columnist, former senior executive, and author of Real Leaders Don’t Follow: Being Extraordinary in the Age of the Entrepreneur (Entrepreneur Press, October 2015). Tobak runs Silicon Valley-based Invisor Consulting and blogs at stevetobak.com, where you can contact him and learn more.