I was recently asked, “what is entrepreneurship?” and “what does it mean to be entrepreneurial?” I’m curious how you’d answer those questions. Before reading on, take a minute to think about it. Hold onto that thought (write it down, if you can, before you move on).

I don’t remember my exact words but I said something similar to:

Entrepreneurship is commercializing a solution to a problem using resources effectively and efficiently. Being entrepreneurial means the active commercialization of a solution while consuming resources effectively and efficiently.

From Merriam-Webster, entrepreneur is:

“one who organizes, manages, and assumes the risks of a business or enterprise.” (Merriam-Webster, 2018) Entrepreneurship is the noun incarnation while entrepreneurial is the adjective version.

BusinessDictionary.com defines entrepreneurship as:

“The capacity and willingness to develop, organize and manage a business venture along with any of its risks in order to make a profit. The most obvious example of entrepreneurship is the starting of new businesses.” (BusinessDictionary, 2018)

Then, you have Harvard Business School (HBS) who uses the definition from Professor Howard Stevenson:

“entrepreneurship is the pursuit of opportunity beyond resources controlled” (HBR, 2018)

Let me parse out my definition to see how I got to it:

  • “commercializing”: The heart of an entrepreneur’s endeavor is making money and doing so at a scale that optimizes this.
  • “a solution to a problem”: Every innovation, idea, product, service should be in pursuit of addressing some problem. HBS’s Stevenson refers to this as opportunity. In layman’s terms, it’s “sale”.
  • “using resources effectively and efficiently”: I admit that this does not have to be a part of the definition. As I sat thinking about the definition I gave, there’s no rule to use resources like this. Entrepreneurs and startups can spend and drive up their burn rate all they want without a firm grasp of returns. That, of course, is not a smart way to build a business. Nevertheless I included this at first because it’s where my mind goes. There’s limited resources either money, time, or people.

Then, there’s the distinction of being an entrepreneur vs. being entrepreneurial. I look at entrepreneurs as the real risk-takers. They’re typically who I would also call the founder(s). Being entrepreneurial provides a broader stroke for those who do not take the initial plunge with the risks involved. However, there’s still a pursuit in commercialization, innovation (problem solving), and resource-consciousness.

Go back to those definitions you thought about at the beginning. Why’d you define those questions like you did? I’m curious – can you share your definitions in the comments below?

One of the biggest take-aways and “duh” lessons from my entrepreneurship professor at Emory was mitigating risk for customers – one of the greatest hurdles entrepreneurs face when selling. Risk, in this case, is tied to the buyer’s job security.
My recent conversation with the Managing Director of a venture capital firm reiterated the importance of mitigating risk for the buyer when assessing/ adopting a new solution. Consider this:

You’re the VP of information security at a Fortune 500 company, and setting up a new data farm. There’s a new startup touting impressive server performance and security layers at half the cost of IBM. However, IBM is one of the premier hardware manufacturers with thousands of customers. They’re reliable and have been around for decades. Who do you choose?

There are many answers you need before you can choose, but the gist is the inherent risk if $hit hits the fan. With a startup, you as the VP may be questioned for selecting a provider with little reliability history. In choosing IBM, much of the risk is shifted towards the large company. Should a server go down, you, personally, might not have been able to curb a catastrophe since IBM couldn’t even handle it.
In my experience with Body Boss, coaches weighed the risk of players not having access to their programs because of network connectivity issues vs. having reliable spreadsheet saved on the desktop that could be printed.
The VC recalled how many startups focus on either the benefits of their startups’ offerings OR risk savings opportunities. Strong startups and salespersons, however, discuss opportunities/ benefits AND risk mitigation (i.e. 99.99% server uptime, 99.8% fulfillment accuracy, etc.).
When you’re selling, approach empathetically and consider the risk for buyer.

What are your thoughts on risk for buyers? What approaches have been successful when selling to others as they relate to both the benefits and the risks involved?