Entrepreneurship is one of those terms with a lot of confusing and conflicting definitions. To some people, it’s about creating a small business or simply creating an income stream. There’s nothing wrong with either of those, but they aren’t entrepreneurship.
Every day on Twitter, I get spammed with something along the lines of this:
I’ll set aside the irony of sending me something like that (even if the stock price did drop a lot from the initial wealth-creation of Eprise). I know that there’s countless people out there who find the idea of financial independence so compelling that they’re willing to set aside their disbelief and buy into any sort of Internet snake-oil scheme. What I bristle at is the term “entrepreneur” being applied to things like multi-level marketing. In fact, entrepreneurship and “small business” are not synonyms either.
I like Peter Drucker’s definition from Innovation and Entrepreneurship: entrepreneurship is about using the tool of innovation to exploit change. Peter wrote about this sort of thing long before the Internet became important, and I still feel his thoughts on entrepreneurship are as relevant today as they were in the 20th century.
Innovation is about creating something new — it could be a new product, a new process, a new business model, a new type of corporate culture. But it’s fundamentally about creation. It is not creation if you are simply replicating someone else’s idea (although imitation, along with a dash of innovation, is fine). It isn’t creation or innovation if you are doing multi-level-marketing, or if you’re simply implementing someone else’s idea.
What does it mean to exploit change? It means looking for an opportunity to solve a problem that emerges because the world is changing in some significant way. It could be a new behavior that people have adopted, a new type of pain someone is feeling, a new desire that didn’t exist before, a fluctuation in the cost of a good or service, a new distribution channel.
If you can identify change, there’s an opportunity to add value through innovation… And what’s great about the Internet is that is is constantly changing — making it an ideal landscape for real entrepreneurship.
Here’s a challenge to anyone reading this: if you want wealth and financial independence, and you think you have the stomach to do something as crazy as being an entrepreneur, then stop reading about snake oil, and stop reading this. Instead, go out on the Internet in search of change. From the chaos or pain wrought by that change, identify problems to solve. Then figure out how to apply innovation to solve the problem. And while we’re at it: you can be an entrepreneur in an existing company — it doesn’t have to be about starting a whole new business (although that’s the usual and most unencumbered way to do it).
That’s all you need to do. The rest is details.
(Jon’s note: I knock MLM a bit in the above article, as a commenter noticed. Okay, it isn’t always inherently evil. And some of the founders of MLM companies are bona-fide entrepreneurs. But you aren’t an entrepreneur because you’re selling distributorships!)