What Do you Understand By Entrepreneur

What Do you Understand By
Entrepreneur?

By Nkuo George Muh
150529

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Introduction

With the developments in the field of technology and the forces of globalization, the
world today can be referred to as a global village, due to its massive growth in international
business and competition. The global economy poses uncountable and substantial challenges for
organizations and industries throughout the world. Thus to survive and keep the lead in this
challenging world is hard. However, this opens new doors to unexploited opportunities such as
Entrepreneurship.

The term entrepreneurship has continuously emanated as a topic of growing interest
among management, scholars and social scientists. Entrepreneurship is said to be one of the most

powerful economic forces which empowers individuals to seek opportunity where others find
difficult problems. They have altered the direction of national economies, industries or markets,
by inventing new products, developed organizations and spearheaded the outburst in new
technologies.

The Topic Entrepreneurship has emerged as one of growing interest over the centuries
and given its importance in economic practice today, questions readily arise such as: What is an
entrepreneur? What characterizes entrepreneurs and distinguishes them from other organizational
and social actors? How can the entrepreneur be defined? These are typical questions that most
new entrepreneurship researchers ask, and to which a variety of answers can be found in the
literature. As for why there is such a broad range of perspectives, the answer is far from simple.

Entrepreneurship is a complex phenomenon that involves a set of activities with
technical, human, managerial and entrepreneurial characteristics, the performance of which
requires a diverse set of skills. The various roles exhibited here provokes the question as to what
constitutes the common core activities and what sets the entrepreneurial aspect of these activities
separate from other aspects.

There is no single way of defining what an Entrepreneur is. Various scholars have
defined an Entrepreneur differently. A look at various definitions will help understand the
concept.

According to the Oxford Dictionary, An entrepreneur is someone “who sets up a
business or businesses, taking on financial risks in the hope of profit”.

This paper aims at establishing a personal point of view on what an entrepreneur is.
But before coming up with a personal point of view, lets review a few classic contributions to
this theory of Entrepreneurship. The relevant ideas of Richard Cantillon, Jean-Baptiste Say, and
Joseph Schumpeter,would be reviewed chronologically in the following paragraphs. These three
views would give us an image of how successful entrepreneurship has developed.

Brief history of the origin and meaning of the term “Entrepreneur”

The term "entrepreneur" is a french word that originated from the verb "entreprendre",
which means " to do or to undertake". It can be broken down to two parts, "entre" which mean
"between", and "preneur" meaning "Taker". Thus, we can literally say an entrepreneur is a
"between-taker", or "go between". This term entrepreneur first appeared in 1253 as "empreneur"
and since 1433, it has appeared to have taken a definitive spelling (Rey, 1994:700)
In 1982, Hélène Vérin a french historian wrote a doctoral thesis in which she discusses
the meaning of the terms “entrepreneur” and “enterprise” through history. She notes that the
ancestor of the term “enterprise” or “emprise” also known in Latin as "imprisia", referred to
something bold, firm and daring (Vérin, 1982: 31-33). She also examined variations in meaning
over the centuries, but the current meaning that also refers to an enterprise leader first appeared

in the early 19th century (Rey, 1994: 700)

Some pioneers in the field of entrepreneurship

Richard Cantillon
Richard Cantillon (1680?–1734)introduced the very concept of "entrepreneur."And he
was the ?rst to acknowledge that there is an entrepreneurial function within the economic
system.Cantillon, was what we would now call a venture capitalist looking for investment
opportunities. His perspective as an investor meant that the element of risk was a core aspect of
how he viewed entrepreneurial projects and defined what he considered to be an entrepreneur
(Cantillon, 1755).
As Schumpeter pointed out, Cantillon had a clear perception of the function of the
entrepreneur and because nobody before Cantillon had formulated it so fully, it may be thanks to
him that French economists never lost sight of the entrepreneurial function and its central
importance”. (Schumpeter, 1954: 222)
As said before, Cantillon was the ?rst to give economic meaning to the concept of
‘entrepreneur.’ The entrepreneur is functionally described as arbitrager. That is, a person who
purchases a raw material at a known price in order to sell it at an unknown price (Cantillon,
1755)
In Engaging in arbitrage and bearing risk, the entrepreneurial class has an equilibrating
function within the economic system. In Cantillon’s definition, an entrepreneur’s role lies
between that of two or more other actors, where he or she acts as an intermediary(or

go-between), thereby instigating a transformation.

Jean-Baptiste Say
After Cantillon, the next person who had the greatest impact on the field of
entrepreneurship as it is today was Jean-Baptiste Say. According to Say, the entrepreneur plays
an essential role both in production and distribution. Say also recognizes the fact that within the
?rm, an entrepreneur is the coordinator, modern leader and manager. Thus, Say is the ?rst to
stress this managerial role for the entrepreneur. To Say, ?Entrepreneurship is the special collection
of skills possessed by an entrepreneur. They have a propensity to take risks above the normal,
and a desire to create wealth for themselves. Say identified the element of innovation as being a
characteristic of the entrepreneur. He perceived entrepreneurs as people who could do new
things,or do more with less, and people who would obtain more by doing something in a new or
in a different way (Say, 1815; 1996). Thus, Say saw the entrepreneur as an economic actor
whose activities generated an added value.

Joseph Alois Schumpeter

Most of Schumpeter’s ideas are reflected in his books ” The Theory of Economic
Development, published in 1911. His theory was the first to associate entrepreneurship with
innovation. He adopted an alternative view on the predominant paradigm of entrepreneurship as

management of the ?rm. His own view was that an entrepreneur is the leader of the ?rm and an
innovator. According to Schumpeter, The function of
the entrepreneur is to reform or revolutionize the patter on of production by exploiting an
invention or an untried technological method of producing a new product or an old one in a new
way (Schumpeter, 1972). Schumpeter often mentioned the concept of creative destruction to
refer to the contribution of innovation by entrepreneurs (Schumpeter, 1954).

It is interesting to know that the database on which these three pioneers, Richard
Cantillon, Jean-Baptiste Say and Joseph Alois Schumpeter, based their reflections on
entrepreneurs and their characteristics or roles, many authors and publications today ascribe a
great deal of importance to the samples used, to classify the research as being reliable and valid,
in compliance with scientific criteria. However, the three pioneers were not researchers. Their
point of reference was in fact composed simply of people they knew who had played
entrepreneurial roles.

The m ost c o m mon e le m en ts u se d i n d efin it io n s o f t h e e n tr ep ren eu r

There are many ways to define an entrepreneur and for most people, an entrepreneur
is a someone who owns and leads a business. However, specialists increasingly use a larger
number of elements in their definitions of and references to entrepreneurs (Julien, 1998).

Ultimately, virtually every author has a different definition of the term, depending on the specific
entrepreneurs or entrepreneurial category studied. 15 elements can be identified as most
frequently mentioned in the definitions from the entrepreneurship literature that can be believed
to be most relevant.Many authors include various elements in their definitions.

An I n te rv ie w w it h
?Kir k B ru gger
? a C on te m pora ry E ntr e p ren eu r

Kirk Brugger is a Certified Financial Planning Professional, an exclusive designation
awarded by the FPSC Financial Planners Standards Council, and a Partner in Brugger Wealth
Management, his family’s long-standing financial services company. Kirk also specializes in
estate planning including Life, Critical Illness, Accident and Disability Insurance. His expertise
in advising high net worth clients, family farm owners, business owners and professionals has
earned Kirk the distinction of being one of Canada’s Top 50 Advisors in 2015. This is what we
know about Kirk Brugger on the professional part of his career, displayed on his corporate
website.
However, what do we know about Kirk as an entrepreneur? Kirk was only about
nineteen years old when he decided to venture into becoming an entrepreneur. This desire was
driven by his passion and vision. As a young man, he was interested in the real estate business.
But was this possible for him to afford all by himself? Not exactly. He decided to get financing
from the bank like most entrepreneurs. Kirk’s growth as an entrepreneur began when he first

identified opportunity in the real estate business, where he could own a home and get tenants to
occupy the house and pay rents to him. Was he just like every other entrepreneur in the real
estate business? No. He was unique in his ideas and trend of thought that ” Why not purchase
and estate and let the tenants pay for it on your behalf,” which all makes sense. Till today he still
upholds this trend of thought. Also, his values of treating all his customers like family creates
more opportunities for him.
So Kirk started from Buying a house and renting out his rooms, to moving out and
getting tenants to occupy the entire house. He wasn’t so interested in making profits just yet but
to ensure that the rents were able to pay the house for itself and maybe earn him some extra
profits. Later when he found this profitable, he acquired another house and did the same thing.
Today, he owns multiple real estates both national and internationally, one of which is Tim's
Hortons on Victoria Avenue, Brandon Manitoba.
Today, Kirk is a successful entrepreneur and Financial Planner. He found
opportunity and followed his dreams while building a career for himself. A typical example that
you can still be successful in a career path and follow your dreams and still end up successful as
an entrepreneur.

According to Kirk, being an entrepreneur means you have to be passionate with a vision and
action oriented. An Entrepreneur should be able to find opportunities and not scared to take
reasonable risk. And if you try and fail, find another opportunity and take risk. To Kirk, an

entrepreneur should be open to ideas and create room for innovation. An entrepreneur should be
willing to accept and adapt to change as the world is in constant change.

In relating Kirk’s story with the principles of effectuation, Kirk’s evolution as an entrepreneur
evolves between the principles of Affordable Loss and Pilot in the Plane.
The Principle of Affordable loss applies here because Kirk had calculated how much it would
cost to purchase the house and place it in a rentable state and presented this opportunity to the
bank which issued him the loan. He also calculated how much revenue he would get from the
rents and weighed it with how much he has to pay for mortgage. When he established that this
risk was worth taking, he went head with a plan.

The Principle of Pilot in the plane focuses on activities where you know your actions would
directly influence the outcome. Here, he took actions that were totally controllable and evaluated
the risk as acceptable because his idea was that the rents collected from his tenants would pay for
mortgage on the house while he still has his regular job earning income. This was smart and the
risk involved here were either the tenants not paying their rents or natural hazards or any other
controllable risk.

Writ e rs P oin t o f V ie w
?.

In revisiting origins of the word Entrepreneur from the pioneers and the story of Kirk’s evolution
as an entrepreneur, a clear relation can be established between what all these people think of the
term Entrepreneurship. A person who identifies a problem and comes between to find a solution,
taking advantage of the opportunities surrounding it and creating room for new ideas and ways
of solving these problems. An entrepreneur is driven by his passion and ability to take risk. An
entrepreneur is always ready to take action, use whatever resources he or she has available and
create something valuable.
What I learned from Kirk and the pioneers about entrepreneurship has broaden my
perception of what this term really is. Finding opportunity is one of the key elements i retained
because, some entrepreneurs can be fully blinded by their passion for something and take a risk
without first establishing if there was opportunity in that niche they are walking into.
Definitely my perception of being an entrepreneur was not completely correct
because i completely omitted the aspects of identifying a problem and finding an opportunity.
My perception for entrepreneurs was that they are relatively driven by their passion to follow
their dreams and ability to take risk. But that is definitely not correct. This creates a whole new
perception for me as to what an ideal entrepreneur has to look like. A risk taker, passionate,
problem solver, opportunity seeker, innovative and able to act.
This doesn't just end here, as this research has provided a better scope as to what
principles of effectuation of entrepreneurship I might need to follow to guide my journey as a
future Entrepreneur.

So to answer the questions earlier mentioned, ?What is an entrepreneur? An
entrepreneur is someone with a creative mind, able to find opportunity, find solution to
problems, take risk, innovative and it able to take action.

1.14 References

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g-th e-E ntr e p re n eu r-C om ple x ity -a n d-M ulti- D im en sio nal- S yste m s-S om e-R efle ctio n
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