Entrepreneurship, Act I

In some corners entrepreneurship has reached cult status.

A couple years ago I was attending a fancy gala, having a drink in the hotel bar with some colleagues, most of whom owned a business. Another friend came over wanting to introduce someone to us. She did so according to whether or not we were an entrepreneur.

“This is Chris, he’s an entrepreneur. This is Dave, he’s an entrepreneur…”

For her, the act of owning a business and being an entrepreneur were synonymous. And being an entrepreneur/business owner brought undeniable status. The fact that I had co-founded and led a social enterprise only got me halfway; I was introduced as a “sort-of entrepreneur.” Another friend who was finishing her PhD on participatory policy development was disparagingly introduced as an “activist,” clearly a lower human form than entrepreneur.

The economic slowdown, stagnant growth rates, and economic shifts has rightly moved the spotlight to entrepreneurs and startups. 100% of net job growth comes from new companies. (There’s plenty of important nuance to this statistic if you want it.)

I’m on the entrepreneurship bandwagon, cheerleading the need for more. But we don’t do ourselves any favors by limiting entrepreneurship to business owners and then claiming the entrepreneur is an advanced human form. We need a broader definition. Fortunately, research backs up this case.

The first person to coin the term entrepreneur, the French economist J. B. Say, didn't constrain his definition. Around 1800 he noted that “the entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and greater yield.” More recently, Duke University’s J. Gregory Dees defined an entrepreneur as someone who “mobilizes resources beyond their control to create value.” 

The act of entrepreneurship - creating value - isn't an indelible character trait. Moreover, with this definition every business person isn't an entrepreneur if resources are not shifted to higher output activities. (Did the new pizza place down the road reinvent takeout? Probably not.) This definition of entrepreneurship can be applied to all sectors of society. It focuses on specific actions and behaviors. And behavior is something that can be taught and practiced. 

Maybe then it's better to think of entrepreneurship as existing along a spectrum. On one end are what New York University Professor Paul Light calls the 24/7 type A entrepreneurs. In the middle are entrepreneurial teams, and on the other end are large and bureaucratic institutions. Entrepreneurial people are found alone, in teams or mired deep inside institutions. What they all have in common, in the words of Peter Drucker, is that they are “always searching for change, responding to it, and exploiting it as an opportunity.” 

Promoting all kinds of entrepreneurship (social, economic, civic, team, organizational) wherever it arises is our urgent priority. It will create jobs, fight poverty, and improve our quality of life. 

Lets keep the cult but open up membership.