Entrepreneur vs. Business Owner: Key Differences

When comparing an entrepreneur vs a business owner, their differences are not always clear and can overlap depending on the person and context. As a very general overview, entrepreneurs are usually focused on innovation, launching new ideas, and taking bold risks, while business owners tend to prioritize stability, manage existing operations, and follow proven strategies.

What Is an Entrepreneur?

An entrepreneur is someone who starts and builds a business, taking on the necessary risks with the hope of earning a reward. They make key decisions and manage resources, making them responsible for the success of the idea. 

Entrepreneurship involves spotting an opportunity, crafting a plan, securing funding, and working to bring the idea to life. 

While not every business transforms the world, anyone who starts one fits the definition. People like Sam Walton, who created Walmart and Sam’s Club, are classic examples of entrepreneurs in action.

What Is a Business Owner?

A business owner is someone who starts and manages a company with the goal of making a profit by offering goods or services. 

They take full control of the day-to-day operations, whether that means handling customer service, managing employees, or tracking finances. They are also in charge of creating business plans, making strategic decisions, and guiding the business towards growth. 

An example of a business owner would be a plumber who owns a small plumbing company and is also the main service provider, or they could run a restaurant where they oversee the chef, waiters, and daily operations to ensure everything runs smoothly.

The Differences Between an Entrepreneur and a Business Owner

IMPORTANT NOTE – The differences between entrepreneurs and business owners are not absolute, and they can overlap and vary a lot, and therefore, the information below provides you with just a general overview of the differences that separate them.

Starting Point

Entrepreneur – Entrepreneurs typically start from scratch with a brand-new idea. They build their business from the ground up and are usually responsible for every decision early on, from product development to securing funding and building a team.

Business Owner – Business owners often start their own business from scratch, but they may also step into their role by buying an existing business or inheriting one, especially in family businesses. This basically means that they take over operations that are already established, sometimes with existing staff, systems, and customers in place.

Offerings

Entrepreneur – An entrepreneur establishes their company intending to sell a completely original product or service that does not yet exist in the market. Because entrepreneurs invent or design their own offerings, they are usually very familiar with and passionate about what they sell.

Business Owner – A business owner typically manages a company that provides products or services that support customers’ existing needs. What they offer usually fits easily into the market and responds to common demand, focusing more on proven solutions than new inventions.

Risk Tolerance

Entrepreneur – Entrepreneurs typically face higher levels of risk by pursuing new business ideas and entering markets that haven’t yet been proven. This bold approach can spark innovation and fast growth, but it also carries a real chance of setbacks and financial loss.

Business Owner – Business owners, especially those running small businesses, usually prioritize stability and consistency over risk. They tend to stick with proven models and established markets, investing their resources into approaches that are more predictable and sustainable, even if growth is slower.

Goals

Entrepreneur – Entrepreneurs typically have an ongoing goal of growing their businesses continuously. Since their ventures are often new to the market, they focus on expanding their reach, building a network, and attracting a loyal customer base to support long-term growth and innovation.

Business Owner – Business owners often aim to maintain steady profits and ensure consistent performance. Their goals often center on improving efficiency, reducing costs, and streamlining operations to support the continued success of an already-established business.

Motivations

Entrepreneur – Entrepreneurs are often driven by the desire to build a legacy of innovation and creativity. They love the idea of running their own business and want the freedom to bring new ideas to life.

Business Owner – Many business owners start their companies out of necessity, focusing on financial stability and providing for themselves and their families. Their motivation tends to be more about steady income and managing a reliable source of profit than pursuing groundbreaking ideas.

Scaling

Entrepreneur – Entrepreneurs often focus on short-term success as a stepping stone toward building a larger company. Entrepreneurs are known to exploit new trends and opportunities as quickly as possible.

Business Owner – Business owners generally aim to run a stable and profitable company over the long term. Their mindset is centered on sustainability and steady performance rather than rapid expansion.

Community Building

Entrepreneur – Entrepreneurs are often less focused on others’ opinions and more driven by making their idea successful. Their main goal is to turn their innovation into profit, regardless of outside perceptions.

Business Owner – Business owners may be more focused on building a positive reputation in their city, supporting their local community, or creating jobs.

Financing

Entrepreneur – Entrepreneurs often rely on their own capital, investors, or partners to get started. Since they are launching something entirely new, they usually need external funding right away and may not have existing assets to use as collateral.

Business Owner – Traditional business owners may have an easier time getting loans from banks because of more conservative financial planning and existing assets. They typically borrow money for larger investments, like new property or large equipment, rather than for launching the business itself.

Creativity

Entrepreneur – Creativity is at the core of entrepreneurship. Entrepreneurs rely on original ideas to shape their businesses and stand out in the market. Their success often depends on their ability to continuously generate fresh, innovative concepts.

Business Owner – Business owners tend to work within proven models and focus on improving existing processes. While creativity still plays a role, they often prioritize efficiency, customer service, and refining what already works.

Use of Technology

Entrepreneur – Entrepreneurs are often early adopters of new technology, using it as a foundation for innovation and disruption. They may build their entire business model around emerging digital tools, making tech central to their products and services.

Business Owner – Business owners typically use technology to support and enhance existing operations. They might invest in better IT systems, eCommerce platforms, or online marketing to increase efficiency and customer reach, rather than using tech as the core of their business.

Self-Employed vs. Business Owner vs. Entrepreneur

A self-employed person works for themselves, usually offering a specific skill or service without managing a team or larger business. They handle most of the responsibilities on their own and often operate as the entire business. 

Unlike business owners or entrepreneurs, they typically don’t aim to scale a company and hire more employees. Examples include a freelance attorney handling legal work independently or a mobile mechanic providing on-site repairs.

Entrepreneur vs. Intrapreneur

Intrapreneurs and entrepreneurs both focus on innovation, but they operate in different environments. Intrapreneurs work within an established company and use its resources to develop new ideas into real-world products or services. Entrepreneurs, on the other hand, work independently, building something from the ground up while relying on outside funding and support to bring their vision to life.

Entrepreneur and Business Owner Examples

Here are a few examples of successful entrepreneurs and business owners:

Ken Rusk

Ken Rusk is a blue-collar entrepreneur and motivational speaker who built a successful career in construction and related trades. He’s also the bestselling author of Blue Collar Cash, where he shares his story and encourages people to find success through skilled trades without needing a college degree.

Thomas Edison

Thomas Edison is recognized as one of the most prolific inventors in history. Edison held 1,093 U.S. patents, including groundbreaking innovations like the phonograph and the motion picture camera. Despite facing countless failures, his persistence and inventive mind helped shape the modern world.

Richard Branson

Founder of the Virgin Group, Branson started his first business as a teenager and went on to launch ventures in retail, music, and transport. He’s known not only for his business success but also for his adventurous spirit and commitment to social causes.

Henry Ford

Henry Ford was an American inventor and businessman who founded the Ford Motor Co. He introduced the moving assembly line method of production, which transformed automotive manufacturing. He also published several books on his views on innovation and other topics.

FAQs – Entrepreneurs vs Business Owners

Do Entrepreneurs Need Different Skills Than Business Owners?

Although there is some overlap, one difference between an entrepreneur and a business owner is that they have different skills. Entrepreneurs focus more on creating and developing innovative ideas, while business owners tend to concentrate on managing daily operations, finances, and production.

Can Someone Be Both an Entrepreneur and a Business Owner?

Yes, many entrepreneurs are also business owners, especially when they manage the company they founded. On the other hand, someone who purchases and runs an existing business without introducing major innovations is usually seen only as a business owner.

Can Someone Be an Entrepreneur Without Owning a Business?

Yes, entrepreneurship is more about identifying opportunities and creating value than simply owning a company. Even after selling a business, someone who continues to innovate and pursue new ventures can still be considered an entrepreneur.

Which Role Is More Likely to Take Risks, an Entrepreneur or a Business Owner?

Entrepreneurs usually take on more risk, since they start new ventures from scratch. Business owners often work to reduce risk and focus on maintaining a stable and profitable operation, especially if the business is already established.

Can a Business Owner Become an Entrepreneur Later in Their Career?

Yes. A business owner can shift into entrepreneurship by launching a new idea, entering a new market, or taking on a more innovative and risk-oriented approach.

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Ken Rusk is a blue-collar entrepreneur who has started several successful endeavors and mentored hundreds of young people in their pursuit of a satisfying career and fulfilling life. Discover how Ken’s approach to life and work can help you set and achieve your goals – all while avoiding the nearly inescapable trap of college debt. Get a copy of the Wall Street Journal bestselling book, Blue Collar Cash today!