Inventor vs Entrepreneur vs Innovator

Before you begin a startup, it's critical to fully understand the difference between these three
terms. Knowing the differences will allow you to determine which role you want to take.
▪ Those who create a new product or technology but may not have the skills or desire to
start and run a business are termed as inventor. Their main focus is not on
commercializing the invention but rather on the invention itself.
▪ On the other hand, entrepreneurs focus almost exclusively on trying to take a product
to market where it can sell to customers or clients. Often, entrepreneurs create companies,
based on the product they want to place on the market, which is why most individuals
who create startups are considered entrepreneurs.
▪ As for innovators, these individuals want to create new ideas and new ways of doing old
things. An innovator will attempt to improve on an existing product that may already be
in the market. For instance, every iteration of the iPhone is considered to be an innovation
over the previous iPhone model. Similarly, innovators may take existing businesses or
technology, and change the way they’re delivered or used by customers and clients.
 Examples of Inventor
Nikola Tesla was responsible for the creation of the AC motor in the late
19th century and the Wright Brothers are credited for inventing the
airplane at the turn of the 20th century.

Some other inventors include:

▪ Alexander Graham Bell- the telephone
▪ Henry Ford- the assembly line
▪ Dr. Robert Jarvik- artificial heart
 Examples of Entrepreneur
▪ Bezos was able to create an online bookstore in the early days of the
internet. Through an effective business plan and fantastic marketing
techniques, Amazon became the largest online store on the internet,
selling products well beyond what he imagined.
▪ This is an example of how entrepreneurs are able to shift and evolve
business plans based on the market and consumer demand.
▪ Other examples of entrepreneurs include: Raza Saeed (founder of
PakWheels), Monis Rehman (founder of [Link]), Kalsoom Lakhani
(founder of Invest2Innovate-i2i) and Shahid Hussain (founder of
Shahi Sawari).
 Examples of Innovator
▪ The smartphone is a perfect example. We had mobile technology and
Wi-Fi; we had laptops; we had cell phones. An innovator asked why
not all in one?
▪ Two of the successful innovators are Steve Jobs and Sergey Brin.
While Steve Jobs helped to create Apple. From devices to packaging,
Jobs was seen as a visionary and innovator.
▪ As for Sergey Brin, he is the mind behind such innovations as Google
Glass and Google's self-driving car. These innovations push
technology forward.
▪ If you want to become an innovator, it's important to set difficult
challenges that will stretch your mind and capabilities. Innovators
typically partner with entrepreneurs to deliver their products.
 Characteristics of Successful Entrepreneurs

1. Passion for the Business

▪ This passion typically stems from the entrepreneur’s belief that the business will
positively influence people’s lives.
2. Product/Customer Focus
▪ An entrepreneur’s keen focus on products and customers typically stems from the
fact that most entrepreneurs are, at heart, craftspeople.
▪ Product should be known as well as the latest trend in the market. It is essential to
know if the current product meets the demand of the market or it is time to change
it a bit. Being able to change as needed is a vital part of entrepreneurship.
 Characteristics of Successful Entrepreneurs
3. Tenacity Despite Failure
▪ Because entrepreneurs are typically trying something new, the failure rate is
naturally high.
▪ A defining characteristic for successful entrepreneurs is their ability to
persevere through setbacks and failures.
4. Risk Bearing
▪ Must be able to assume the risk involved in the enterprise and needs to be a
risk taker and not an avoider. He should have the ability of being risk
bearing. A new venture does have a great risk to fail. Needs to be
courageous to evaluate and take the risk which is an essential part of being
an entrepreneur.
5. Execution Intelligence
▪ The ability to fashion a solid business idea into a viable business is a key
characteristic of successful entrepreneurs.
 Common Myths About Entrepreneurship

▪ Myth 1: Entrepreneurs are born, not made

▪ Myth 2: Entrepreneurs are gamblers

▪ Myth 3: Entrepreneurs are motivated primarily by money

▪ Myth 4: Entrepreneurs should be young and energetic

▪ Myth 5: Entrepreneurs love the spotlight

 Common Myths About Entrepreneurship
Myth 1: Entrepreneurs Are Born, Not Made

▪ This myth is based on the mistaken belief that some people are

genetically predisposed to be entrepreneurs.

▪ Whether someone does or doesn’t become an entrepreneur is a

function of their environment, life experiences, and personal choices.

 Common Myths About Entrepreneurship
Myth 2: Entrepreneurs Are Gamblers

▪ Most entrepreneurs are moderate risk takers.

▪ Many entrepreneurs have a strong need to achieve and set challenging

goals, a behavior that is often equated with risk taking.

 Common Myths About Entrepreneurship
Myth 3: Entrepreneurs Are Motivated Primarily by Money

▪ While it is naive to think that entrepreneurs don’t seek financial

rewards, money is rarely the reason entrepreneurs start new firms.

▪ In fact, some entrepreneurs warn that the pursuit of money can be

distracting.
 Common Myths About Entrepreneurship
Myth 4: Entrepreneurs Should Be Young and Energetic

▪ Entrepreneurial activity is evenly spread out over age ranges.

▪ What makes an entrepreneur “strong” in the eyes of an investor is

experience, maturity, a solid reputation, and a track record of success.

 Common Myths About Entrepreneurship
Myth 5: Entrepreneurs Love the Spotlight
▪ While some entrepreneurs are flamboyant, many of them do not attract
public attention.
▪ As evidence of this, consider the following question: “How many
entrepreneurs could you name?”
▪ Most of us could come up with Jeff Bezos of [Link], Mark
Zuckerberg of Facebook, Larry Page and Sergey Brin of Google or
may be Elon Musk of Tesla and SpaceX.
▪ But few could name the founders of Netflix, YouTube.
 Economic Impact of Entrepreneurial Firms
Innovation
▪ Entrepreneurial firms provide a platform for aspiring entrepreneurs to test
their ideas and bring new innovations to the market. This in turn helps bring
advanced technology and higher-quality products to the market.

Job Creation
▪ They play a vital role in increasing overall employment rates and reducing
unemployment rates. This is because small businesses tend to have a higher
propensity to hire locals, often providing jobs for individuals within their
immediate communities.
 Economic Impact of Entrepreneurial Firms
Impact on Society
▪ The innovations of entrepreneurial firms have a dramatic impact on society.
A society becomes greater if the employment base is large and diversified. It
brings about changes in society by promoting facilities like higher
expenditure on education, better sanitation, fewer slums.
▪ Think of all the new products and services that make our lives easier,
enhance our productivity at work, improve our health, and entertain us.
Impact on Larger Firms
▪ Many entrepreneurial firms have built their entire business models around
producing products and services that help larger firms become more
efficient and effective.
 Types of Entrepreneurial Firms

Entrepreneurial firms can be classified into the following types:

i. Small business entrepreneurship

ii. Scalable startup entrepreneurship

iii. Large company entrepreneurship

iv. Social entrepreneurship

 Types of Entrepreneurial Firms
1. Small Business Entrepreneurship
▪ Small business entrepreneurship involves starting a business, usually local, that an
entrepreneur believes can benefit the city or town they operate in.
▪ These people run their own business and hire family members or local employees.
▪ Earn profit to feed their family not to make 100 million business or taking over industry.
▪ They fund their business by taking small loans from friends, family and from
microfinance banks.
▪ Examples are local retail stores, local tailors, hairdresser, carpenter, plumber, and
electrician etc.
 Types of Entrepreneurial Firms
2. Scalable Startup Entrepreneurship
▪ Scalable startup means young company with unique product which may become a big one
in future.
▪ Scalable business entrepreneurs also have access to funds or obtain funding from venture
capitalists and angel investors. They attract the investors with their unique and out of the
box ideas.
▪ For example: Facebook, founded in 2004 by Mark Zuckerberg has grown into the world’s
largest social network, allowing users to create personal profiles, share photos and videos,
send messages, and keep in touch with friends, family, and colleagues. Over the years,
Facebook has expanded its ecosystem to include other services like Messenger,
WhatsApp, and Instagram, further solidifying its position in the digital world.
 Types of Entrepreneurial Firms
▪ Large Company Entrepreneurship
▪ These companies grow and sustain by offering new and innovative
products such as Samsung, Google, Microsoft.
▪ These large companies operate their business operations worldwide.
▪ The change in technology, customer preference, new competition etc.
build pressure on them to create an innovative products to capture both
existing and new customers.
 Types of Entrepreneurial Firms
4. Social Entrepreneurship
▪ These entrepreneurial businesses focus on creating those products which
provide services to people and solve their social needs and problems.
▪ Social entrepreneurs want to change the world and make it a better place
rather than just accumulating profits and acquiring wealth.
▪ Such entrepreneurial businesses can be for-profit, non-profit, or a hybrid,
but acquired funds typically support operations, and extra capital is
redistributed into the community.
▪ Some examples of Social Entrepreneurship include microfinance
institutions, welfare services etc.
 Steps in the Entrepreneurial Process
Once the decision to become an entrepreneur is taken the
entrepreneurial process begins. The 5 stages of an entrepreneurial
process are
1. Discovery
2. Concept development
3. Resourcing
4. Actualization
5. Harvesting
 Steps in the Entrepreneurial Process
1. Discovery: This is the stage in which an entrepreneur generates ideas,
recognizes opportunities and studies the market.
2. Concept Development: Develop a business plan which is a detailed
proposal describing the business idea.
3. Resourcing: The stage in which an entrepreneur identifies and acquires
the financial, human and capital resources needed for the venture startup.
4. Actualization: The stage in which the entrepreneur operates the business
and utilizes resources to achieve its goals/ objectives.
5. Harvesting: The stage in which the entrepreneur decides on business’s
future/ growth, development or demise.