Entrepreneurship is the creation or extraction of economic value. With this definition, entrepreneurship is viewed as change, generally entailing risk beyond what is normally encountered in starting a business, which may include other values than simply economic ones.
As you start a business and then work to build your start-up, often you will hear about the four types of entrepreneurship.
- Small Businesses Entrepreneurship
- Scalable Start-up Entrepreneurship
- Social Entrepreneurship
- Large Company Entrepreneurship
SMALL BUSINESS ENTREPRENEURSHIP February 2023
Think about your local hardware store, coffee shop, or garden center. These are all examples of small business entrepreneurship. This category doesn’t mean that you don’t have a large team and great revenue, but your path forward is likely different than the other categories below. Some small businesses do scale up – think of a chain of coffee shops, where they decide to adopt a franchise model (Tim Horton’s for example), and this can mean that your business can move between categories, but the category you fall into is based on where your business is right now.
SCALABLE STARTUP ENTREPRENEURSHIP February 2023
A scalable start-up is often a business that is using technology or creating technology in the business. Think of a SAAS (Software As A Service) company that creates a Customer Relationship Management (CRM) software. They are going to sign on subscribers for a monthly or annual fee. The business falls into space with large market size and the potential for them to grow quickly and exponentially exists.
SOCIAL ENTREPRENEURSHIP February 2023
Social entrepreneurship is mission-driven work. Think of an entrepreneur who develops an assistive device, or someone who is working on making clean water more accessible to people living in rural, remote locations in poverty. These are social missions, sometimes based on the UN’s Sustainable Development Goals. A social entrepreneurship entity can be any size.
LARGE COMPANY ENTREPRENEURSHIP February 2023
This is where a larger company spins off a new division. Though isn’t the type of entrepreneurship we often engage with, it’s an exciting category, where we see disruptive innovation started by a company with the funding to move quickly and make a difference.
WHY DO THE TYPES OF ENTREPRENEURSHIP MATTER? February 2023
As you consider starting a business and becoming an entrepreneur, these categories of business are important, because which one you fall into will impact the options that are right for you, and what programs and funding are available to you. The various types have some amount of overlap and you may find yourself questioning what group you fall into. Small business and scalable start-up entrepreneurship are likely the easiest categories to determine. Social entrepreneurship can easily layover either of these categories, and it may be useful for you to decide what you identify with most. Most of the clients we see at Innovation Factory fall into these three categories.