TYPES OF ENTREPRENEURS

Entrepreneurs are categorized into different types based on the

following classifications:
• Based on the Business Type
• Based on the Technology
• Based on Ownership
• Based on Gender
• Based on the Enterprise size
• Based on Clarence Danhof
Based on the Business Type
Depending on the type of business, entrepreneurs are classified into the
following types:
Trading Entrepreneur
• A trading entrepreneur refers to a person who undertakes business-
related activities.
• These types of entrepreneurs usually buy finished products in bulk
from manufacturers at some discount.
• They then sell these products directly or with the help of retailers or
vendors with profits.
• A business entrepreneur usually acts as a middleman between
manufacturers and customers.
• This may include wholesalers, retailers, dealers, etc.
Manufacturing Entrepreneur
The founder of a business to manufacture products is known as a
manufacturing entrepreneur.
Manufacturing entrepreneurs analyse market needs or customer
needs and manufacture products to meet such needs using
various resources or technologies.
In simple words, manufacturing entrepreneurs transform raw
materials into finished products according to the customer's
needs.
Agricultural Entrepreneur
• Agricultural entrepreneurs refer to the types of
entrepreneurs who primarily do agricultural work.
• They participate in a wide range of agricultural activities
such as
• Farming,
• Irrigation,
• Agricultural Produce,
• Mechanization, Technology, etc.
Based on the Technology
Based on technology, entrepreneurs are classified as below:
Technical Entrepreneur
• Such entrepreneurs are called technology entrepreneurs who use to start and continue
industries primarily based on science and technology. These entrepreneurs develop
new ideas and turn those ideas into technology-based innovations and inventions.
They always work to create new methods of production in the fields of technology and
science. Besides, they also manufacture products that can help ordinary citizens and
other non-technical entrepreneurs in their enterprises.
• Engineering graduates, diploma holders from polytechnic, etc., who use their
technical knowledge in production techniques and persons with experience who use
their skills in production process, when they start their venture, are technical
entrepreneurs.
Non-Technical Entrepreneur
• As the name suggests, entrepreneurs who do not set up and run
enterprises based on science and technology are known as non-technical
entrepreneurs.
• In short, non-tech entrepreneurs are those who work for innovations
using traditional methods.
• They typically use alternative and exemplary marketing methods and follow
non-technical delivery strategies to engage directly with customers.
• This ultimately helps them to survive and grow their business in a
competitive market. Moreover, they create better relationships and meet
customer needs.
• Developing marketing and distribution strategies to promote sales
creating demand for their goods and services is just an example.
Based on Ownership
Based on ownership, entrepreneurs are classified into the following
types:
Private Entrepreneur
• When an entrepreneur starts something personal of his or her own,
such as setting up an enterprise, he/she is called a private
entrepreneur.

• A private entrepreneur is the only person who plays the sole

proprietor role for a business venture and bears the risk
associated with it.
State Entrepreneur
• When a state or government does a business or
industrial undertaking, it is referred to as a 'state
entrepreneur’.
• In this case, the government is the sole owner of the
enterprise and will bear all the profits and losses
involved with it.
Joint Entrepreneurs
• When a business or industrial undertaking is established
and operated jointly by the private entrepreneur and
the government, it is called joint entrepreneurship. The
parties involved are called joint entrepreneurs.
• In this case, risk and profits are shared by both parties.
• However, the sharing percentages generally depend on
the type of business and the agreement between the two
parties.
Based on Gender

Based on gender, entrepreneurs are classified into the following types:

Men Entrepreneurs
• When any business venture is formed, managed and operated by men,
these men are referred to as men entrepreneurs.
Women Entrepreneurs
• When any business venture is formed, managed and operated by women,
these women are referred to as women entrepreneurs.
• Besides, if women have a minimum 51 percent share of the capital, they
can also be known as women entrepreneurs.
Based on the Enterprise size

Based on the size of the enterprise, entrepreneurs are classified

into the following types:

Small-Scale Entrepreneur

If an entrepreneur has invested up to a maximum of 1 crore

in starting an enterprise, including plant and machinery,
such entrepreneur is called Small Scale Entrepreneur.
Medium-Scale Entrepreneur
• If an entrepreneur has invested a minimum of 1 crore to a
maximum of 5 crores in starting an enterprise, including
plant and machinery, then such entrepreneur is called
Medium Scale Entrepreneur.
Large-Scale Entrepreneur
• If an entrepreneur has invested more than 5 crores in
starting an enterprise, including plant and machinery, such
an entrepreneur is called a large-scale entrepreneur. This
includes any investment above 5 crores.
Based on Clarence Danhoff Study

Clarence Danhoff conducted a study on American agriculture

and classified entrepreneurs accordingly. According to him,
entrepreneurs generally have less initiative and drive when
they start any business venture.
However, they learn things with their continued economic
work and become more innovative and passionate.
Based on his study, he classified entrepreneurs as follows:
Innovative Entrepreneur:
• Innovative entrepreneurs, also known as innovators, are the type of entrepreneurs who
usually come to the market with new ideas or innovations.
• An innovative entrepreneur is one who is able to foresee potentially viable and profitable
opportunities through innovation.
• This type of entrepreneur is highly motivated and talented and “innovation” is his key
function.
An innovative entrepreneur may exhibit talent in the following forms:
 Introduction of a new product or introduction of a new quality of an existing product.
 Introduction of a new method of production.
 Opening of a new market.
 Discovery of a new source of supply of raw materials or semi-finished goods.
 Reorganisation of the enterprise so as to achieve monopoly or to break up the monopoly
position.
Adoptive or Imitative Entrepreneur
Imitative entrepreneur is one who is ready to adopt the
successful innovations already introduced by innovating
entrepreneurs.
An imitative entrepreneur does not innovate anything by
himself, but he only imitates techniques and technologies
innovated by others.
Imitative entrepreneurs apply strategy from other enterprises in a
manner where all core fundamentals of the original business model
are replicated, and all efficiencies are retained. These entrepreneurs
help improve any product, production process or suggest the use
of improved technology addressed by other enterprises.
3. Fabian Entrepreneur

Fabian entrepreneur is one who adopts a great caution and

disbelief in introducing any change in the business.
Normally, he has neither the will to introduce any new changes nor
the desire to adopt new methods.
He is ready to imitate only when it becomes perfectly clear that
failure to do so would definitely result in heavy loss for him.
He is dominated more by customs, religions, traditions and
past practices and he is not ready to take any risk at all.
These entrepreneurs are known for not making sudden decisions.
4. Drone Entrepreneur

Drone entrepreneur is one who blindly follows the traditional

strategies or methods for development, production or marketing
even when it causes loss to him.

He is not prepared to introduce any change under any

circumstances in the method of production he has already
introduced.

These entrepreneurs feel or experience pride and tradition in

the old ways of doing business.
On the Basis of Motivation
Pure Entrepreneurs: Guided by motive, these entrepreneurs
start new business, apply their business skills and prove their
excellence in business.
Induced Entrepreneurs:
• In order to motivate potential businessmen to start their own
ventures, the Central and State Governments provide facilities
and incentives and offer subsidies in the form of land at cheap
rate, loans at concessional rate, tax exemption, supply of
scarce raw materials, subsidy on capital investment, etc.
• Induced by the incentives and concessions, these entrepreneurs set
up their own business units.
• Spontaneous Entrepreneurs: The inner need and strong desire to become
an entrepreneur, drive people to start their own business.
• Such entrepreneurs have self-confidence and inborn talent to run the
business successfully.
• They set up their industrial units spontaneously with no motivation from
others or inducement from promotional agencies.
While there is no proper rule of becoming an entrepreneur, the common
methods involve the followings:
• Develop a unique idea for a business
• Get an understanding of the various enterprise sectors, such as
management, finance, accounting, marketing, etc.
• Create a proper business plan and arrange for funding
• Hire specific employees with corresponding business requirements
• Implement competitive strategies and launch products or service
• Find and connect related market and customers to distribute the
products or services
• Expand the business combing new ideas and products
Intrapreneur
• An intrapreneur is an employee who is given the authority and support
to create a new product without having to be concerned about whether or
not the product will actually become a source of revenue for the company.
• Entrepreneur refers to a person who set up his own business with a new
idea or concept. Intrapreneur refers to an employee of the organization who
is in charge of undertaking innovations in product, service, process etc.
• "Dreamers who do-those who take hands on responsibility for creating
innovation of any kind within a business. -Pinchot
• A person within a large Corporation who takes direct responsibility of
turning an idea into profitable finished product through assertive risk taking
and innovation.
Basis Entrepreneur Intrapreneur
Meaning Entrepreneur refers to a person who Intrapreneur refers to an employee of
sets up his own business with a new the organization who is in charge of
idea or concept. undertaking innovations in product,
service, process etc.
Approach Intuitive Restorative
Use resources provided by the
Resources Uses own resources.
company.
Capital Raised by him. Financed by the company.
Enterprise Newly established An existing one
Dependency Independent Dependent

Risk Borne by the entrepreneur himself. Taken by the company.

Creating a leading position in the Change and renew the existing
Works for
market. organizational system and culture.