What is entrepreneurship? How to become an entrepreneur?
Though the definition of entrepreneurship has remained the same in economic terms, the role of an entrepreneur continues to evolve. With the rise of technology and increased access to capital for entrepreneurs of all types, entrepreneurship is becoming the career path of choice. As of 2020, there are 582 million entrepreneurs in the world, with 62% of adults stating that entrepreneurship is a good career. From small businesses to international companies, entrepreneurship is essential to keeping our economy healthy and balanced.
So, what does it mean to be an entrepreneur, and how can you become one? What is the impact of entrepreneurship on society, and why is this role so important? We’ve created a comprehensive guide that covers the skills and steps needed to become an entrepreneur. We’ve also included testimonials and wise words from successful entrepreneurs to help you better understand the important role of an entrepreneur a bit better.
The basic definition of entrepreneurship is the act of creating a business to turn a profit. However, in our modern age, entrepreneurship has developed to include the act of transforming the world by solving large-scale problems. With the advent of the internet, entrepreneurship has the power to create social change through the creation of a service or product that impacts individuals in positive ways and addresses social issues with great ideas.
Entrepreneurship is also an opportunity for self-motivated individuals to create their own career path and income, working for themselves to develop goods or services that people want or need. It’s a risky approach to making a living, but it can result in amazing rewards and lasting success.
What is an entrepreneur?
An entrepreneur is an individual who creates a business with the goal of turning a profit. Entrepreneurs come up with an idea for a good or service and package it to sell to consumers. Entrepreneurs can also improve upon an existing good or service, and sell it as a better alternative to consumers in the market.
Some entrepreneurs end up falling into entrepreneurship by accident, where their side hustle becomes their main gig, such as a photographer who transitions from doing casual photography on the side to starting a full-fledged photography business. Other entrepreneurs dive right into entrepreneurship as their main source of income, such as the owner of an independent retail business or an online shop.
Regardless of how you fall into entrepreneurship, entrepreneurs are an important part of our economy and our society. Without entrepreneurs, we probably wouldn’t have a lot of innovative products and services we use today.
Why become an entrepreneur?
Becoming an entrepreneur might be appealing to you because you’re feeling stuck in your current career and are looking for a major change. Or you might have an amazing idea that you want to try to turn into a viable business. There are several perks to being an entrepreneur, including:
Be your own boss
Being an entrepreneur is appealing because it gives you the ability to turn a profit on your own terms, for a business that is all yours. Maybe you are tired of working for others and want to strike out on your own. Or perhaps you have a great idea and want to turn it into a viable business. Many people are drawn to entrepreneurship because they are self-motivated and want to be independent when it comes to earning a living.
Create a new product or service
Becoming an entrepreneur gives you the freedom to build a product or service from scratch, turning an original idea into a viable business. Though becoming an entrepreneur will not always be easy, and comes with many risks, taking on this role will give you the opportunity to create something new in the marketplace.
Build your own schedule and work from anywhere
Many entrepreneurs are drawn to a lifestyle where they can work flexible hours and not have to adhere to someone else’s schedule. Keep in mind many entrepreneurs end up working more hours to get their business going, but this may be worth it if you are working for yourself. Being an entrepreneur also means you can work from home or travel for work and not be stuck in an office all day.
Be your own employer
You may find entrepreneurship appealing out of necessity, either because you are struggling to find employment or you’re tired of working in your current job. Many entrepreneurs make the leap into self-employment because they want to take control of their finances and be more self-reliant when it comes to employment.
What are the characteristics and key skills of an entrepreneur?
Though there are so many different ways to become an entrepreneur, most entrepreneurs share a few key characteristics. These characteristics are often what helps an entrepreneur become successful and continue to grow their business.
Entrepreneurs are innovative
Often, the term “entrepreneur” and “innovator” are used interchangeably. The definition of “innovative” is “original and creative thinking,” and an innovator is someone who “introduces new ideas.” Entrepreneurs are innovative because they apply creative thinking to an issue or problem and create a new product or service as a solution to the problem.
According to Altimese Nichole, Founder of NicholeNicole, “Many are excited to become an entrepreneur but get discouraged when reality hits. Entrepreneurship means staying committed to your goals beyond your feelings of excitement. Stay the course, and keep your “why” in mind.”
Entrepreneurs are problem solvers and change makers
Entrepreneurs focus on solutions and focus on how they can address an issue or problem. This means they often have to think critically to come up with a unique solution. They focus on how they can make an issue better or improve on an existing solution to a problem.
Often, entrepreneurs act as change-makers, advocating for a shift in the way things are normally done. In fact, many entrepreneurs come up with business ideas by engaging with their community and considering the gaps that can be filled with a good solution.
The founder and CEO of NeuroFlow, notes: “Entrepreneurship means being the one that is willing to take a leap, work hard enough to sacrifice everything else around you, all in the name of solving problems because no one else is capable or possesses the desire.”
Entrepreneurs aren’t afraid of failure
Because entrepreneurship is a risk, and there are no guarantees you will be successful, entrepreneurs are also resilient and don’t give up. Though there are many successful entrepreneurs, they often had to fail and persevere through many challenges to get to where they are. Entrepreneurs have to be open to failure, as many small businesses do not survive their first year of operation, and use failure as an opportunity to grow.
Says Jolijt Tamanaha, Director of Marketing and Finance of Fresh Prints, “Entrepreneurs make their way down a never-ending list of problems with grit, passion, and energy. While intense, being an entrepreneur means you get to live life learning an incredible amount and maximize your impact on the world because you have to tackle the hardest problems.”
Entrepreneurs adapt and evolve
To be successful, entrepreneurs must be able to evolve and adapt to changes in the marketplace. This is an important characteristic, as it allows entrepreneurs to respond well to the changing needs of the consumer, and tweak their business model to meet the demands of the market. They have to be good at pivoting to respond to changes in the marketplace and be open to evolving their business. Often, adapting and evolving is how an entrepreneur figures out how to expand their business and increase their impact.
So, for example, an entrepreneur may adjust an existing product to make it more environmentally friendly or to have more features than a competing product. Or they may change their existing service to respond better to the needs of their audience or to expand their audience to include more consumers.
According to James Sandoval, Founder and CEO of Measure Match: “Being an entrepreneur means diving headlong into a [likely very risky] venture of your own making, working hard, long hours, often alone, to carve out a path to success and never, ever giving up.”
How does entrepreneurship impact the economy?
Entrepreneurship has an important impact on the economy, in several different ways, including:
Entrepreneurship increases employment and decreases poverty
By going into business for themselves, entrepreneurs create their own employment. If they are successful, they may also employ others and help to increase employment related to their operations, such as a supplier for their business. They also help to decrease poverty by employing themselves and others.
Entrepreneurship opens up new markets and stimulates the economy
Because entrepreneurs create new businesses all the time, they are inventing new goods and services or improving on existing ones. This creates a ripple effect that helps to open up new markets in the economy. By creating new products and services regularly, entrepreneurs help to keep the economy healthy and innovative. Given that capitalism is a profit-and-loss system, entrepreneurs help to uncover what consumers want and determine what drives profit.
For example, in the 1990s, new information technology companies emerged in India, and businesses associated with other industries, like hardware providers and customer service centres, developed as well to support this new entrepreneurship.
Entrepreneurship helps to increase national income
Another way entrepreneurship impacts the economy is by increasing the gross national income (GNI), which is the total amount of money earned by the nation’s people and businesses. With increased employment, people in the economy earn more and contribute more to the nation’s tax base. This then helps the government spend more on public projects and services. Entrepreneurship is a critical driver to creating a healthy economy, and is an essential aspect of many economies around the world.
Entrepreneurship furthers social change in society
Entrepreneurs break with tradition and the status quo to push the economy to new and exciting directions. Often, entrepreneurs are responsible for the development of the latest, greatest products, rendering old methods and systems obsolete. They can also bring more awareness to a gap in social services or goods and identify weak spots in society.
Entrepreneurship creates a healthy, balanced economy
Left unregulated, research has shown that entrepreneurship can lead to unfair market practices and corruption, as well as income inequality. This is why the government often helps to develop the entrepreneurial ecosystems, supporting entrepreneurs through programs and venture capitalism to maintain a healthy, balanced economy. The government also supports business incubators, education programs for entrepreneurs, and other resources to encourage entrepreneurship.
Who are some noteworthy Canadian entrepreneurs?
Canada has our fair share of successful entrepreneurs across many different industries. Their success stories are all different and not without challenges, but there is much inspiration and knowledge to be gained from reading more about their journey. Some noteworthy Canadian entrepreneurs doing impressive things are:
Harrison and Wallace McCain
Perhaps two of the most famous Canadian entrepreneurs are the brothers Harrison and Wallace McCain. The McCain brothers are known as the co-founders of the frozen foods empire McCain Foods Limited, launched in 1956. The business grew out of their father’s seed potato farm, cutting up potatoes and freezing them as fries. Their business quickly became the world’s largest supplier of frozen foods, opening international factories and providing more than a third of the international market for French fries.
Founder of BroadbandTV, the third largest video property in the world, Shahrzad Rafati is an entrepreneurial success. Her Vancouver-based digital entertainment company follows close behind Google and Facebook, providing high-quality online content nationally and internationally. Rafati dove into entrepreneurship as a new graduate, recognizing the potential of online video content and the need for a business model that benefits content creators as well as consumers. She launched BroadbandTV and is now focused on cultivating a new generation of content creators in Canada,and beyond.
Dr. Xue Wu is the co founder and CEO of Geneseeq Canada, a leader in biomedical research. Her company uses comprehensive genomic testing to develop better cancer care and therapies for patients. With its headquarters in China, Geneseeq is building a genomic testing centre in Toronto, which will encourage collaborations with pharmaceutical and biotech companies and cancer research facilities to improve early cancer detection and monitoring. This entrepreneurship is a great example of providing an essential service that will create positive change and have a lasting impact on society.
Canadian entrepreneur Jenny Bird started her jewelry company in 2008 and turned it into a worldwide brand. Creating high quality-jewelry at a reasonable price point, Jenny Bird is now sold at over 600 retailers around the world, with showrooms in major cities, and strong brand recognition.
Best known as the founder of Molson Brewery, John Molson started his entrepreneurship journey at just 18 years old with funding from his grandmother. Molson quickly expanded his company and constructed Lower Canada’s first distillery, establishing Molson as the fifth-largest brewery in the world. He also used his entrepreneurial success to support social causes like Montreal’s art sector, the construction of Canada’s first railway, and Montreal’s premier public healthcare facility.
Tonia Jahshan is an entrepreneur who founded Steeped Tea. Inspired by a great cup of Cream of Earl Grey tea, she decided to start a company that brings high-quality tea with bold flavours to consumers. After a successful appearance on Dragon’s Den, Jahshan received investment in her company and grew Steeped Tea into a successful business in Canada and the US.
This Canadian entrepreneur identified that Canada has a plastic problem, and decided to create a unique solution. As the CEO of GreenMantra, her company turns plastics into synthetic waxes and other chemicals that can be reused in other industries. With the goal of creating a more circular economy that upcycles and reuses, rather than disposes of, Jodie Morgan has emerged as a leader in the renewable resources industry, making a strong environmental and social impact through entrepreneurship.
How do you become an entrepreneur?
The road to entrepreneurship is not a straight line, and many successful entrepreneurs experience detours and roadblocks before finding their footing. Unlike a more traditional profession, becoming an entrepreneur is often a lot of trial and error, and a healthy dash of perseverance. The great thing about being an entrepreneur is how accessible it is as a career, regardless of your background or education level.
However, there are several key steps you can take to increase your chances of success as an entrepreneur.
Be financially stable
Though it is definitely possible for you to be an entrepreneur without being financially flush, and some successful entrepreneurs have, having some financing set aside will make your entrepreneur journey easier. Try to put together an adequate cash supply to cover your business expenses for at least the first year.
Being financially stable before you jump into entrepreneurship will give you more wiggle room to build your business over a longer period of time. It will also free you up to focus on seeking ongoing funding and creating a sustainable business model, rather than be forced to try to make some quick cash.
Another aspect of being financially stable is having no debt and no overhead to start. If you do have debt, try to minimize it or pay it down as much as possible before you start your business. Employ yourself to start to keep your overhead costs down, and as your business expands, only hire employees once your business is financially viable and off the ground.
Cultivate a diverse skill set
As an entrepreneur, you have to wear multiple hats and tap into many different skills to build your business. Make a list of your current skills and identify any gaps in your skillset. Then, think about how you can learn more about the skills you might need to develop further so you can feel confident in your skillset as an entrepreneur.
For example, maybe you have strong sales skills but are lacking in bookkeeping or finance-related skills. Or perhaps you have strong interpersonal skills, but you struggle with using social media to promote your business.
Cultivating a diverse set of skills means you can tap into them when you need them and hit the ground running. It will also make you more self-reliant and more of a problem solver when it comes to the day to day operations of your business.
Do your research
Before you leap into entrepreneurship, take some time to research existing small businesses and entrepreneurship. Read books and blogs about entrepreneurship, listen to podcasts about entrepreneurship, and follow entrepreneurs on social media. You may want to focus your research on a specific industry or area, especially if you’re thinking about creating a good or service for that industry. Take a look at what’s already available and the competitors in that industry.
Consume as much information as you can about entrepreneurship, so you are aware of what worked and what didn’t. As an aspiring entrepreneur, information is power, and best of all, often free for you to access.
Identify a problem you’re passionate about
As an aspiring entrepreneur, you probably have a lot of good ideas, but you won’t be able to make all of them a reality. Rather than chase every problem you see, focus on the problem you are most passionate about solving, the problem that nags at you and keeps you up at night. Your passion and dedication to solving that problem are what will push you as an entrepreneur and give you the drive to be successful.
Ask yourself what problem you are the most passionate about solving, and why. The “why” will keep you motivated as you embark on your entrepreneurship journey and remind you of the passion you have for solving the problem.
For example, you may be inspired to solve the problem of food scarcity in your community because you grew up in a household where there was limited access to fresh produce.
Create a unique solution
Successful entrepreneurs often respond to a problem with a specific solution that is unique and impactful. Think about how you can add value to the problem and contribute something of new value to the marketplace. Be as specific as you can, and consider if your solution is different from what’s already available or offers consumers something new.
For example, maybe you realize that there is a lack of access to fresh produce in your community, and come up with the unique solution of a mobile grocery store that provides fresh produce on a weekly basis.
Build community with other entrepreneurs
Being an entrepreneur can be a difficult and rewarding career, especially during the early years of your business. Reach out to other entrepreneurs in your community and connect with them to build your network. Ask them questions about how they handle the challenges of entrepreneurship, from incorporating to merchandising to promoting products on social media.
Think about ways that you can collaborate with other entrepreneurs and boost each other up, such as working on a product together or collaborating on a community event. Building strong community ties with other entrepreneurs will help you grow your business in a sustainable way and stay connected with the needs of those around you.
Make your dreams of entrepreneurship a reality
In this comprehensive guide, we’ve covered pretty much everything you could ever want to know about being an entrepreneur, including the successes and challenges, as well as the skills and steps you can take to become an entrepreneur. Hopefully, you’re feeling well-versed in what it takes to be an entrepreneur and may even be inspired to pursue this interesting career path.
Ready to start your business? Ownr has helped over 15,000+ entrepreneurs hit the ground running quickly – and affordably. If you have questions about how to register or incorporate your business, give us a call at 1-800-766-6302, Monday through Friday from 9 am to 5 pm EST, or email us email@example.com
This article offers general information only and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or its affiliates.