Types of Entrepreneurs
The various types or entrepreneur are classified as under:
(1) According to the Type of Business:
(i) Business entrepreneur
Business entrepreneurs are those entrepreneurs who conceive the idea of a new product or service and then translate their ideas into reality. Entrepreneur examines the various possibilities of sources of finance, supply of labor, raw-materials or finished product as the case may be.
Business entrepreneur may be undertaking the trading business or manufacturing business but initially the size of the business is very small. As the entrepreneur flourishes, he tends to expand his business.
(ii) Trading entrepreneur
As the very name indicates trading entrepreneur is concerned with trading activities and not manufacturing. Trading means buying the finished product from the producer and selling off to the customer directly or through a retailer.
A trading entrepreneur has to be creative enough as he has to identify the market. He has to identify potential market, create demand through extensive advertisement of his product and thus inspire people to buy his product. For this is inevitable for him to find out the desires, tastes and choices of his customer in domestic as well as international market.
(iii) Industrial entrepreneur
As the very name indicates, an industrial entrepreneur is one who sets up an industrial unit. He perceives the opportunity to set up his unit, complies with necessary formalities of getting license, power connection, pollution control clearance (if the need be) arrange initial capital, providing securities and guarantees to the financial institutions, making payment of wages and supply necessary technical know-how. An industrial entrepreneur has the ability to convert economic resources and technology into a considerably profitable venture. Manufacturer of leather products, textiles, electronics, food items and the like are industrial entrepreneurs.
(iv) Corporate entrepreneur
Corporate entrepreneur is the one who plans, develops and manages a corporate body. He is a promoter, an essential part of board of directors, an owner as well as an entrepreneur. He gets his corporate body registered under the requisite Act which gives his company the status of separate legal entity.
(v) Agricultural entrepreneur
Agricultural entrepreneur is the one who is engaged in the agricultural activities. He uses latest technology to increase the productivity of agriculture and also adopts mechanisation.
(2) According to Motivation:
(i) Pure entrepreneur
Pure entrepreneur is one who may or may not possess an aptitude for entrepreneurship but is tempted by the monetary rewards or profits to be earned from the business venture. He is status-conscious and wants recognition.
(ii) Induced entrepreneur
Induced entrepreneur is attracted by the various incentives, subsidies and facilities offered by the government. ‘An entrepreneur is not born’ —this is no doubt true as every person can be trained to become a good entrepreneur. Most of the entrepreneurs who enter into business are induced entrepreneur as various kinds of financial, technical and managerial facilities are provided by the government to promote entrepreneurship. An entrepreneur can develop himself much more by attending EDPs and they can make a stand in the market. Import restrictions, allocation of production quotas to SSIs, reservation of products for small industry etc. have forced many young people to set up a small industry.
Non-Resident Indians (NRIs) and educated unemployed seeking self-employment or newly married bridegrooms by taking financial support of their in-laws may be described as induced entrepreneur. This class of entrepreneur accounts for maximum number of failures because there is no proper screening of misfits.
(3) According to the Use of Technology:
(i) Technical entrepreneur
The strength of a technical entrepreneur is in his skill in production techniques. He concentrates more on production than on marketing. He possesses craftsman skill in himself which he applies to develop and to improve the technical aspect of the product.
(ii) Non-technical entrepreneur
Unlike technical entrepreneur, non-technical entrepreneur is not concerned with the technical aspect of the product rather he spends more time in developing alternative strategies of the marketing and distribution to promote his business. His target is not to change the production technique but how to increase the demand of the product in which he is dealing.
(iii) Professional entrepreneur
Professional entrepreneur means an entrepreneur who is interested in floating a business but does not want to manage or operate it . Once the business is established, he sells it out and catches on to float a new business.
(4) According to Stages of Development
(i) First generation entrepreneur
First generation entrepreneur are those entrepreneurs who do not possess any entrepreneurial background. They start an industrial unit by means of their own innovative skills.
(ii) Second generation entrepreneur
Second generation entrepreneur are those entrepreneurs who inherit the family business firms and pass it from one generation to another.
(iii) Classical entrepreneur
A classical entrepreneur is a stereotype entrepreneur whose aim is to maximize his economic returns at a level consistent with the survival of the unit but with or without an element of growth.
(5) Classification Given by Danhof :
Depending upon the level of willingness to create innovative ideas, there can be the following types of entrepreneurs:
i) Innovative entrepreneurs
These entrepreneurs have the ability to think newer, better and more economical ideas of business organization and management. They are the business leaders and contributors to the economic development of a country. An innovating entrepreneur is one who introduces new goods, inaugurates new methods of production, discovers new market and re-organizes the enterprise. He arranges money, launches an enterprise, assembles the various factors, chooses the competent managers and sets his enterprise go.
Inventions like the introduction of a small car ‘Nano’ by Ratan Tata, organized retailing by Kishore Biyani, making mobile phones available to the common may by Anil Ambani are the works of innovative entrepreneurs.
Example: Steve Jobs the founder of iPod, Michael Dell, founder of Dell Computers.
ii) Imitating entrepreneurs
These entrepreneurs are people who follow the path shown by innovative entrepreneurs. They imitate innovative entrepreneurs because the environment in which they operate is such that it does not permit them to have creative and innovative ideas on their own. Innovative entrepreneur is creative, while imitative entrepreneur is adoptive.
Such entrepreneurs are found in countries and situations marked with weak industrial and institutional base, which creates difficulties in initiating innovative ideas.
In our country also, a large number of such entrepreneurs are found in every field of business activity and they fulfill their need for achievement by imitating the ideas introduced by innovative entrepreneurs.
Development of small shopping complexes is the work of imitating entrepreneurs. All the small car manufacturers now are the imitating entrepreneurs.
Example: Walton BD. has introduced its motorbikes, refrigerators, televisions and other electronic appliances in Bangladesh not being the original inventor of those products.
iii) Fabian entrepreneurs
The dictionary meaning of the term ‘Fabian’ is ‘a person seeking victory by delay rather than by a decisive battle’. Fabian entrepreneurs are those individuals who do not show initiative in visualizing and implementing new ideas and innovations wait for some development which would motivate them to initiate unless there is an imminent threat to their very existence. Fabian entrepreneurs are cautious and skeptical in experimenting change in their enterprises. Such entrepreneurs are shy, lazy and lethargic.
Example: Kodak, a company that happened to be the market leaders in producing analog cameras but they did not realize the change and the introduction of the Digicam. For what they lost their leadership, having lost the leadership they have diversified the business in producing the Digicams instead of producing Analog cameras.
iv) Drone entrepreneurs
The dictionary meaning of the term ‘drone’ is ‘a person who lives on the labor of others’. Drone entrepreneurs are those individuals who are satisfied with the existing mode and speed of business activity and show no inclination in gaining market leadership. In other words, drone entrepreneurs are die-hard conservatives and even ready to suffer the loss of business.
Example: Citycell Telecom Bangladesh, in spite of having knowledge about there market fall they have not yet changed there business policy.
(6) According to Capital Ownership
(i) Private entrepreneur
When an individual or a group of individuals set up an enterprise, arrange finance, bear the risk and adopt the latest techniques in the business with the intention to earn profits, he or the group is called us private entrepreneur/entrepreneurs.
As the name indicates, state entrepreneur means the trading or industrial venture undertaken by the state or the government itself.
Joint entrepreneur means the combination of private entrepreneur and state entrepreneur who join hands.
(7) According to Gender and Age
(i) Man entrepreneur
(ii) Woman entrepreneur
(iii) Young entrepreneur
(iv) Old entrepreneur
(v) Middle-aged entrepreneur
(8) According to Area
(i) Urban entrepreneur
(ii) Rural entrepreneur
(9) According to Scale :
(i) Large scale industry entrepreneur
(ii) Medium scale industry entrepreneur
(i) Small scale industry entrepreneur
(ii) Tiny industry entrepreneur.