What Are the Main Types of Entrepreneurs?

There are no certificates or diplomas that can help you become an entrepreneur. However, having a business or marketing degree or knowledge of finance and economics can help. Entrepreneurship is a broad and dynamic field. The majority of entrepreneurs are the ones who create and run their businesses. Roughly, entrepreneurs are the ones who find opportunities, create new products or services, and manage the growth of their businesses. The main types of entrepreneurs are as follows;

• Small Business Entrepreneur: Small business entrepreneurs run local stores, restaurants or services and often focus on providing a product or service to their community. They also tend to do most, if not all, of the work for their business, from sales and marketing to finance and operations.
• Startup Entrepreneur: Startup entrepreneurs develop products or services with high growth potential, such as creating new markets or disrupting existing ones. Startups often seek investment from venture capitalists, have scalable business models, and aim to grow as fast as possible.
• Serial Entrepreneur: A serial entrepreneur builds several businesses over their career. Once a business is up and running, it becomes a viable option to sell the company to someone else or find a manager to take over the business, leaving the entrepreneur to move on to the next venture. Serial entrepreneurs are innovation junkies and always focus on the next big thing.
• Social Entrepreneur: Social entrepreneurs are people who create innovative products or services that attempt to solve social problems. Their focus is on creating a positive social impact, for example in healthcare, education or the environment. Their goal is to do ‘good’ rather than to make a profit.
• Corporate Entrepreneur (Intrapreneur): This is the entrepreneur who works within large organisations, using entrepreneurial methods to create new products, services, or business models. Intrapreneurs, also known as intrapreneurs, are change agents whom companies hire to spark entrepreneurship in their business.
• E-Commerce Entrepreneur: E-commerce entrepreneurs own and run businesses that operate primarily online. They sell physical goods, digital products or services. E-commerce businesses can be set up on a website or by using an existing platform, such as Amazon, eBay, or Shopify. E-commerce businesses allow more flexible and scalable operations than traditional brick-and-mortar retailers and can reach a global audience.
• Franchise Entrepreneur: A franchise entrepreneur invests in an existing business by purchasing a franchise. A franchise is a proven business model and a brand that allows a business to be started with reduced risk. Examples of franchises include McDonald’s, Gold’s Gym, and Jiffy Lube.
• Lifestyle Entrepreneur: Lifestyle entrepreneurs create businesses around their interests or passions. Their goal is to build a business that will fund a sought-after lifestyle, rather than growing into a large business or generating significant revenue. Examples include travel bloggers, fitness coaches, and others in the creative industries.
• Tech Entrepreneur: Tech entrepreneurs build tech-based products or services. They might specialise in areas such as software, artificial intelligence or biotechnology. They are the ones who drive technological innovation and disruptive business models.
• Nonprofit Entrepreneur: The other type of entrepreneur is the nonprofit entrepreneur, who works to create organisations to impact a social, cultural, or environmental issue. For example, they might set up a nonprofit organisation that aims to alleviate a problem and, in turn, would rely on donations, grants and partnerships within the nonprofit sector to fund their venture. Most nonprofits would be happy to be self-sustaining and cover their operating expenses. Still, their ultimate goal is to make an impact on the social good rather than to make money.

What Does an Entrepreneur Do?

An entrepreneur turns her ideas into businesses, performing different roles in the process, from generating ideas for businesses to running the operations, marketing, and finance for her company. Below, you will read about some of the core management tasks for an entrepreneur.

• Spotting opportunities: Entrepreneurs are constantly searching for business opportunities. This could be looking for gaps in the market, needs of consumers that aren’t being met, or new trends that can lead to innovative products or services.
• Preparing business plans: You need a business plan to articulate a clear vision of what the business aims to achieve and the strategies it will use to achieve its goals, as well as the financial projections. Entrepreneurs use plans to chart the direction of their business – and to impress potential investors or financiers.
• Acquiring Funds: Funding is the most important aspect for entrepreneurs. It is required in order to start a business; entrepreneurs have the option to fund their business by saving their own money, getting a loan from a bank, getting financial help from venture capital, angel investors or crowdfunding. Acquiring funds is the step to start a business. It helps to manage overhead during startup, buy equipment, or hire a workforce.
• Team building: An entrepreneur must identify and hire people who can help with the firm’s objectives. This involves not just recruiting employees but also training and motivating them, as well as ensuring that they buy into the founder’s vision.
• Marketing and Sales: Entrepreneurs typically have a lot of responsibility for marketing and selling their product or service, whether it’s by developing and executing marketing strategy, positioning and building the brand and reputation, and making sales or negotiating sales deals.
• Managing Money: Any business, especially one that depends on a regular customer base, needs to track money coming in and out, as well as the flow of cash and the bottom line. This involves tracking income and expenses, compiling cash flow and profit and loss statements, ensuring that the business brings in enough money to stay afloat, preparing budgets, and processing payroll.
• Risk Management: When you are an entrepreneur, there is plenty of risk involved – the risk of losing money as well as the risk that someone else might come up with your idea and be the one to do it well. Anytime you are starting a business, you need to think about the risks involved. You need to figure out what might go wrong and develop a plan for how to handle it. If possible, you should avoid a situation where you are putting your entire financial life at risk. That’s the situation that many people get themselves into.
• Innovation and Growth: Entrepreneurs constantly innovate and modify their business models to meet the changing dynamics of the market and customers’ preferences. This could involve introducing new products, entering new markets, or upgrading existing operations to boost growth.
• Networking and partnerships: Entrepreneurship involves establishing relationships with other entrepreneurs, investors, suppliers, industry experts, and other stakeholders. Through networking, entrepreneurs can gain access to resources that they need to start up and run their ventures, receive valuable advice from mentors, and form strategic partnerships with other companies to grow their businesses.
• Scaling Operations: When the business has become established, the entrepreneur turns attention to scaling operations, which might mean expanding to new markets, increasing throughput or diversifying revenue streams. Scaling operations typically require planning and investment to ensure that growth is sustainable.

Average Entrepreneur Salary

Earnings can vary from a small salary to a very large income depending on the type of business, the industry and the degree of success of the entrepreneur. Unlike employees who generally receive a fixed salary, the income of an entrepreneur is often linked to the performance of the business. The table below provides some general information about the potential earnings of entrepreneurs in the UK.

• Small business entrepreneur: On average, a person who owns their own business in the UK will earn between £20,000 and £50,000 a year, depending on how big and profitable the business is. Some may make less, especially during the first couple of years, and some may make more depending on how the business is doing.
• Startup Entrepreneur: Startup entrepreneurs can earn even more than those working in the City, but their income is much more erratic. Early-stage startup founders might take no or very little salary, ploughing their profits back into growing the business. However, those who have successful startups – that manage to secure venture capital or scale rapidly – can earn £100,000 or more, particularly if the founder keeps equity in the company.
• Franchise Entrepreneur: Franchisees can expect to make between £30,000 and £80,000 per year, depending on the franchise brand and the geographic location. They can earn more or less, depending on the initial level of investment, operational costs, and success of the franchise.
• Tech Entrepreneur: A tech entrepreneur can make a lot of money, especially if you are a tech entrepreneur who produces something new or that is easily scalable. Suppose your business grows quickly or is acquired by a larger company. In that case, you can earn millions by buying stock options, getting dividends, or selling the business.
• Social Entrepreneur: Social entrepreneurs who run for-profit businesses with social-impact goals earn between £20,000 and £60,000 per year, while social entrepreneurs who run nonprofit organisations may have to rely on grant-making organisations or individual donors for funding. Their income is likely to be lower.

Entrepreneur Skills

A successful entrepreneur must be able to develop many different skill sets. An entrepreneur must be flexible, able to find many different ways to do things, and willing to do many different things. These are the skills needed for a career in entrepreneurship:

• Creativity and Innovation: An entrepreneur needs to think creatively and develop new and innovative solutions to problems. This might include identifying a market opportunity, developing a new product or service, or finding ways to differentiate the business from its competitors.
• Leadership and Team Management: This is the quality that ensures that the team that entrepreneurs are leading be able to work together and achieve their goals. Strong leadership skills allow the entrepreneur to motivate and inspire team members, assign tasks, manage conflicts, and create a healthy and productive work environment.
• Financial Literacy: Sound financial literacy is an absolute must for cash flow and budget management in any business, as well as for making the right investment choices. Entrepreneurs need to know how to read a company’s financial statements – and their own – to track key performance indicators and keep the business running in
• Risk-Taking: You have to be prepared to take risks in business. This means being comfortable with uncertainty and bold enough to make decisions that could result in massive rewards or complete failure.
• Networking: Having a large network of contacts is key for entrepreneurs. Entrepreneurs who are skilled networkers have access to resources, advice and connections that they can leverage to make their business successful. Entrepreneurs need to be able to build and maintain relationships and professional connections.
• Sales and marketing: Entrepreneurs need to understand sales and marketing to promote their products or services. This means coming up with marketing strategies, learning about consumer behaviour and finding out what marketing channels – such as word-of-mouth or online marketing – are most useful for their particular business.
• Time Management: Business owners may have to wear several hats at once; this includes overseeing operations, handling finances and marketing. Strong time management skills are needed to prioritise various tasks and ensure that deadlines are met.
• Resilience: Being an entrepreneur is a tough job; setbacks are inevitable. Highly resilient entrepreneurs will be better equipped to overcome obstacles, stay motivated, and keep working toward their goals despite failure.
• Problem Solving: Entrepreneurs also face problems – financial, operational, etc – often daily. Being able to think rationally and come up with a solution helps to keep the business on track and moving forward.
• Adaptability: Markets and industries can drastically shift in a short period, and entrepreneurs need to be adaptable. This might mean changing the business model or pivoting to another product or service to meet shifting demand.

Entrepreneur Tips

Below are some practical tips for budding entrepreneurs on how to start and grow your business. 

• Start with a vision: Develop a vision for your business before you begin. Spell out your business goals, your target market, and the problem that your product or service will solve. The more detail, the better. This vision will provide the roadmap that you should follow, making decisions easier and keeping you on track.
• Do solid market research: To find opportunities and make good business decisions, it’s important to understand your market. Find out how many people might want to buy your product or service, who your competitors are, and who your potential customers are.
• Build a Business Plan: A business plan is a roadmap for your business. It should include your goals, strategies to reach those goals, who your customers are/will be, how you will fund your business, and a financial projection for the business with details on how you plan to grow. A business plan is also paramount in order to raise money from investors or bank loans, so it is a foundational document.
• Start small and grow big: It’s tempting to want to grow quickly, but it’s often better to start small and grow big by experimenting, perfecting the plan, and building a loyal base of customers. It reduces your risk and lets you learn how to operate your business better.
• Assemble an advisory board: To find experts who can guide you and provide guidance, reach out to industry contacts, small business advisers, mentors and fellow entrepreneurs. Join business networks or local organisations to get advice and resources.
• Try it on for size: before investing too much in your business, test your idea with a small-scale launch or prototype. Then, you can get feedback, refine the idea and confirm demand while limiting your initial capital exposure.
• Manage your cash flow: Cash is king when it comes to a new business. Track your finances, monitor costs and have enough working capital to cover operating expenses. Plan for cash flow shortfalls and find funding when needed.
• Stay Flexible and Open to Change: You might have the best business plan in the world, but things sometimes go differently than they are. You might need to change your product, your market or your business model.
• Focus on customer satisfaction: How you relate to your customers is a good predictor of how successful your business will be. Deliver top-notch service, listen to feedback, and constantly improve your product or service to satisfy your customer’s needs.
• Invest in Marketing and Branding: Create a strong brand and marketing strategy to attract customers by investing in digital marketing, social media and SEO to build brand awareness and attract traffic to your business. Ensure you have a consistent brand and messaging to establish your business’s image and reputation.

Entrepreneur Requirements

There are no formal qualifications to be an entrepreneur. Still, there are some skills, knowledge and experience that can increase the chances of getting a successful start. Here are the steps and requirements for your entrepreneurship journey:

• Formal education: While there is no set path for education, many entrepreneurs benefit from a formal business, marketing or finance background. A bachelor’s degree in business administration, economics, or a related field can provide a solid base in financial and managerial accounting, management and marketing. It may result in the successful completion of a senior project.
• Experience: If you have experience in the industry or field in which you want to start a business, it will be invaluable. You will gain insight into trends, customers and how the business operates.
• Business skills: Every entrepreneur has to know the basics of financial management, marketing, sales, and leadership. Formal education in business administration, executive training programmes, or on-the-job training may hone these skills.
• Network: Start cultivating a wide range of business contacts so that you can have people to bounce ideas off of, ask for advice from, and get help with resources. Attend networking events, join business associations, and mentors, ideally ones who have already been successful with the business you want to start, are also a great resource.
• Access to Capital: Almost all businesses need capital to get started. Whether it’s your savings, a bank loan, or investors, raising money before you open your doors can help fund all your startup costs, inventory purchases, and expenses until your business becomes profitable.
• Resilience and Tenacity: Entrepreneurship is not for the faint of heart. Setbacks are a commonplace feature of setting up and running a business. Good entrepreneurs are resilient and tenacious. They can withstand the challenges that are thrown at them while keeping their eyes fixed on their long-term objectives.

How to Become an Entrepreneur

Becoming an entrepreneur involves taking an idea and turning it into a viable business. Here’s a step-by-step guide to help you on your journey:

1. Develop a Business Idea: Start by identifying a problem or need in the market. Brainstorm potential solutions, focusing on ideas that align with your skills, passions, and market demand.
2. Conduct Market Research: Research your target market to understand customer needs, preferences, and behaviors. Analyze competitors and assess market trends to identify opportunities and potential challenges.
3. Create a Business Plan: Develop a detailed business plan that outlines your business goals, strategies, target market, and financial projections. A solid business plan will guide your decision-making and help secure funding.
4. Secure Funding: Determine how much capital you need to start your business and explore funding options. This could include personal savings, bank loans, angel investors, venture capital, or crowdfunding.
5. Build a Team: Assemble a team of skilled professionals to help you achieve your business goals. This could include hiring employees, finding co-founders, or working with freelancers and contractors.
6. Register Your Business: Choose a business structure (sole trader, partnership, or limited company) and register your business with HM Revenue and Customs (HMRC) or Companies House in the UK. Make sure to obtain any necessary licenses or permits for your industry.
7. Launch Your Business: Start by testing your product or service with a small-scale launch. Gather feedback from customers, refine your offering, and gradually scale your business as demand grows.
8. Market Your Business: Develop a marketing strategy to attract customers and build brand awareness. Use a combination of digital marketing, social media, content marketing, and traditional advertising to promote your business.
9. Monitor Progress and Adjust: Track your business’s performance through key metrics such as sales, customer acquisition, and profitability. Be prepared to adjust your strategies based on market conditions and feedback.
10. Scale Your Business: Once your business is established, focus on scaling operations. This could involve expanding into new markets, increasing production capacity, or launching new products.

Frequently Asked Questions

Why Should You Be an Entrepreneur?

Being an entrepreneur is one of those career paths that allow you to start a business from your home, build something from scratch, and earn a good living. You can turn a hobby of yours into a full-blown business. You can solve a problem. You can make a difference in the world. You can make a dent in the universe.

Is Being an Entrepreneur a Good Career Choice for You?

Entrepreneurship is the most rewarding and the most difficult career path. If you are a hard worker, persistent and daring, this path is gold for you. An entrepreneur should be flexible, inventive, and a hard worker who can overcome all the obstacles to build a business empire.

Entrepreneur Salaries

The income of an entrepreneur can widely vary depending on the type of business, the success of it, and the industry. Some entrepreneurs make a small salary in the beginning and may only make a little with the business itself. On the other hand, successful entrepreneurs can make a ton of money from the sales of the product, dividends, or by selling their business.

Which Qualifications Can Help with a Career as an Entrepreneur?

There are no certificates or diplomas that can help you become an entrepreneur. However, having a business or marketing degree or knowledge of finance and economics can help. It is also possible to learn about business management, entrepreneurship and financial planning through courses.

Do I Need to Be an Experienced Entrepreneur to Get Started?

Not as such – you don’t need to have been an entrepreneur before to become an entrepreneur. However, building experience in the industry or working in a related field can be very helpful in giving you insights into the industry that will improve your chances of success.

Entrepreneur Career Outlook

The future appears bright for entrepreneurs, especially as technological progress spurs innovation and creates new industries. Entrepreneurs are needed in practically every industry, and an entrepreneur who adapts to changing market conditions can succeed.

Entrepreneur Hierarchy and Progressing Within the Role

As an entrepreneur, you define your career direction, and this decision-making power becomes an important value that you embody. This is another way you interact with the concept of freedom. I have encountered three types of entrepreneurs: small business owners or first-time startup founders, who later scale their businesses or launch new ventures, and entrepreneurs who become investors, mentors, or consultants.

Entrepreneur Exit Options and Opportunities

Entrepreneurs, therefore, have several exit options to choose from, which include the following: selling the business, merging with another business, or handing over to a family member or partner. Often, entrepreneurs sell their businesses for profit and move on to new ventures, becoming serial entrepreneurs.