What's the difference between an entrepreneur and a small business owner?

Both words are used interchangeably with entrepreneur taking the lead. However, not everyone is an entrepreneur and a small business owner has nothing to be ashamed of. Here is an easy way to make the distinction. An entrepreneur is usually a strong risk taker and is generally not in the business for the long haul.

Perhaps you have heard of a serial entrepreneur – that term is used for business owners who have had several businesses, or are currently involved in multiple businesses. Some are successful ventures and others have been failures. However, they keep coming up with new ideas and launching businesses.

After achieving initial success, entrepreneurs often opt to sell their business for further development by someone more qualified. There are very few entrepreneurs who are capable of taking a business from initial concept and able to scale it successfully. If that happens to be the case, then generally there are very strong, capable advisors along the way . . . not to mention some good luck!

A small business owner is the more traditional type. Think of your everyday business. It is someone who:

• Loves what they do
• Is skilled at something
• Hopes to pass the business down to another generation
• Plans to retire from the business after a significant amount of time
• Not interested in huge growth
• Generally is not a big risk taker. They will gamble, but only to a certain point.

Over the years, people seem ashamed or embarrassed when they are referred to as a small business and there is no reason for it. According to federal statistics[1], small businesses:

• Represent 99.7% of all employer firms
• Can have up to 500 employees (for most industries)
• Employ just over half of all private sector employees
• Pay 44% of U.S. private payroll
• Can have sales up to $7 million (for most retail industries)
• Make up 97.3% of exporters
• Produce 13 times more patents per employee than large firms

So, as you can see, there is nothing bad about being classified as a small business. These companies can be very large indeed, depending on the industry and the Small Business Administration’s (SBA) classification.

Next time someone asks you about your company, proudly say you are one of America’s finest, you are a small business owner!