To understand subtle differences or similarities between businessman and entrepreneur, it is necessary to understand the things they do i.e. business and entrepreneurship. There is quite a debate and varying opinions about whether entrepreneurship is different to business or is it the subset of business. Also, there is debate over whether entrepreneurship means simply starting a new business or does it require the component of innovation/invention in it.
In my opinion, entrepreneurship means “starting” a “business” with new idea or innovation which can be in the form of product or business process. Keeping all the components or characteristics of business same, what differentiates entrepreneurship from other kind of businesses is the innovation or invention. In that sense, entrepreneurship, for me, is nothing but the subset of business. Having said that, a company or person who can introduce innovation or new idea to their business or process even after long establishment of their business can be said to have an entrepreneurial spirit.
However, though I pretty much understood about what is business; I realized that if someone would ask me define the business, I would struggle to put it in words. On turning to Cambridge dictionary, to put definition of business in words, I came to know that business is the activity of buying and selling goods and services. So simple! In that sense manufacturing products in itself is not business but since the manufacturers sells their product either directly to customers or to distributors, they are doing the business. Hence, industrialists are doing business too.
But what really is entrepreneurship then. As per business dictionary, entrepreneurship is the capacity and willingness to develop, organize and manage a business venture along with any of its risks in order to make a profit. As per Wikipedia, Entrepreneurship is the process of designing, launching and running a new business, which is more often than not, initially a small business, offering a product, process or service for sale or hire. Cambridge dictionary defines entrepreneurship as skill in starting new businesses, especially when this involves seeing new opportunities. All of these definitions stresses upon entrepreneurship as “starting a new business” regardless of innovation or invention.
In that sense, businessman is someone who sells goods and services. Entrepreneur is someone who starts the business. In long run, entrepreneur becomes businessman if he/she sticks to same business. However, in today’s context, we try to associate certain traits or characteristics such as risk-taking, open-minded, curious, inquisitive, innovative, persistent, energetic etc. with entrepreneurs and try to define them with it. That is probably why it is confusing. Hence, Peter Drucker had famously wrote in his book Innovation & Entrepreneurship that “Most of what you hear about entrepreneurship is all wrong”.
He has completed his MBA from Kathmandu University School of Management (KUSOM) with specialization in Finance.