Entrepreneurs are made, not born

Here are three basic types of emerging entrepreneurs

Basic Survivalist

Years ago I worked as an educator in a rural area of Virginia, in the United States.  This area, once lush with tobacco fields, fell into recession when states recognized the link between tobacco and health care costs. With tobacco farming no longer profitable, the people of this region became a rich resource of low-skill workers.  At the same time, attracted by low wages and loose labor laws, local manufacturing plants (jeans, furniture, plastic bags) shut their doors and moved overseas leaving the local workers, (often three generations of the same family) isolated in a remote, rural location with few marketable skills and fewer jobs. My role as an educator was to offer new skills training to prepare these workers for the new world.  My intentions were good, my impact was minimal. These resourceful people did not look to an institution to save them in some way but, instead, they took what skills they had at their disposal and went into business for themselves.  As I toured the counties with my road show of training opportunities I noticed back hoe services advertised on every fence post; fresh eggs awaited down every drive, beauty parlors appeared in the mobile home parks, lawn mower repair in every garage. This is basic survival entrepreneurship.

Pre-Entrepreneur

At a slightly higher level of business organization is the pre-entrepreneur.  At this level the business person is no long trading one product or service but may have various products: lawn mower repair, small engine repair, and snow removal for example.  Still the pre-entrepreneur may have low expectations for reward and poor understanding of the requirements of a successful business.  Moving from farming or manufacturing to business leadership does require new knowledge and skills. Here in South Africa, and in many other countries, one sees craft vendors selling whatever merchandise they can obtain: sun glasses, coat hanger, telephone car chargers, toy guitars.  At a higher quality level once might find crafts; beadwork, carving, art. Hard working and tenacious sales people, these entrepreneurs have poor prospects for sustainable business growth until they learn to differentiate their product from the competition and to more exactly target their market.

Subsistence Entrepreneur

At this level of entrepreneurship the business owner is beginning to see the vision of creating an independent income. This level is well illustrated by the story of South African, Elsie Matosele. Elsie began her business selling just as a pre-entrepreneur selling a different few items. Over time, she expanded her product offerings always aware of what her market, the people of her community needed.  As she responded to the needs of her target market Elsie became a reliable source for ballpoint pens, nappies and safety pins. Elsie’s business grew because her products solved problems for her customers. She’s gained the trust of her market because she is reliable, and always prepared to serve her customers.   Elise says, she ”takes care of her customers the way a doctor takes care of his patients.”  Elsie’s story is one of a developing entrepreneur.

Micro Entrepreneur

From her street corner stand and the hard work of years, Elsie has grown from a Subsistence Entrepreneur to a Micro Entrepreneur.  By carefully managing her finances, writing down every sale and guarding her profits, she has managed to improve her personal life.  Elsie has managed to purchased and expand her own home and purchase a metered taxi.  She hires someone to drive for her, extending the value she add to her community.

Small Scale Entrepreneur

At this level the business owner must be well educated in business in general, well financed and provide a product or service with adequate demand.  An example of a business at this level would be an independent attorney or accountant or a service provider.  The next step from this level is to create a system. One where the values is added without the owner doing all the work.  This is the level where freedom begins to be possible.

Which Level Are You?

Whichever type of entrepreneur you are now, all it takes to grow to the next level is a vision of a more profitable future, a  strategy for getting there and consistent focused action. You can take the first step by signing up to be notified when my book, Vision to Decision: A Self-Coaching Guide to Starting a New Business is released.

Adapted from:  Entrepreneurship: A South African Perspective, ed. Gideon Neiman and Cecile Nieuwenhiuizen