Although the terms businessman and entrepreneur may seem interchangeable, they are entirely different. The key differences between businessman and entrepreneur can be pointed out by their mode of entry, motive, role, nature and strategies in the market. An entrepreneur creates entirely new business concept out of the existing problem in market ecosystem and tries to solve it, whereas a businessman sees a profit generating possibility from the existing business ideas in the market.
In this article, we are going to differentiate entrepreneur and businessman in much more details. First of all, let’s discuss the meaning of both of the terms: businessman and entrepreneur.
Definition of Businessman
A businessman is a person who engages in activities related to commercial or industrial purposes. He establishes his company as a new entrant in the market among other existing companies with similar purpose. Since businessmen are profit oriented, they choose a business that is in high demand which can generate high profit, regardless of its uniqueness.
A businessman faces high competition because of the already existing competitors in the market doing the same thing. The risk factor is minimal since he is walking down a path that has previously been tested by his competitors and the chances of failure are low.
A businessman’s primary goal is to earn revenue through the use of human, financial, and intellectual resources by doing economic activities.
Definition of Entrepreneur
An entrepreneur is someone who develops a new business idea or concept and sees it through to completion. He is the one who bears the risks and uncertainties of the business. A Startup Company is the entrepreneur’s venture, and it is developed for the first time in terms of an idea, innovation, or business method.
He or she is always the market leader, no matter how many competitors arrive later. Their position will not change.
The entrepreneur is the most important factor of production in economics because he or she brings together and mobilizes the other three factors of production: land, labor, and capital. These entrepreneurs eventually advance to the level of businessman.
Entrepreneurs are well-known for their inventiveness. They are in charge of bringing in new ideas and managing resources. They offer products and services that make a positive impact on the world.
Real-life examples include Bill Gates (founder of Microsoft), Mark Zuckerberg (co-founder of Facebook), Larry Page (co-founder of Google), Elon Musk (co-founder of Neuralink and OpenAI) and Steve Jobs (co-founder of Apple).
The Key Differences Between a Businessman and an Entrepreneur
- An entrepreneur is a person who contributes his or her own unique idea to a new business. A businessman is someone who starts a company from an existing concept or idea.
- A businessman establishes his market position through strategies, hard work, management and dedication, whereas an entrepreneur creates his own market.
- A businessman is just a market participant, whereas an entrepreneur is a market leader as he is the first to build a business of his own.
- A businessman’s nature is calculative, whereas an entrepreneur’s nature is intuitive.
- Entrepreneurs are visionary and they set long-term goals, whereas businessmen are focused on short-term profit.
- The risk of failure for a businessman is quite low. It is because the market is already established and risk and uncertainties are already assessed. On the other hand the risk of failure for an entrepreneur is very high.
- A businessman uses traditional methods to run his or her business. An entrepreneur, on the other hand, employs novel methods to achieve the same goal.
- An entrepreneur is more concerned with the welfare of his employees, customers, and the general public than a businessman is with making a profit.
- Because obtaining a competitive position in an already existing market is extremely difficult, which is not the case for an entrepreneur, the businessman faces intense competition.
To summarize, a businessman is someone who operates or starts a business with the same old business idea, whereas an entrepreneur is someone who has a unique idea to initiate and establish a new venture. And their role, activities, nature and mode of operation differs as they try to sustain their own kind of business model.