Those interested in taking on a leadership role in industry may find themselves pulled in the direction of becoming an entrepreneur, but that is not the only method professionals have available to become a business leader. A growing amount of attention has been focused on intrapreneurs. These professionals also play a vital role in building businesses, but their role differs slightly from entrepreneurs.
If you want to establish yourself as a business leader, you need to carefully consider the difference between entrepreneurs and intrapreneurs to better determine which path you want to take. Here is what you need to know about each of these options, including the similarities and differences between them, so you can start to plan your targeted career path.
What is Entrepreneurship?
An entrepreneur is someone who starts their own company. They develop a great idea for a business, a way for them to set themselves apart from others in the industry and satisfy some need of the target customers. As an entrepreneur, you are responsible for everything. Whether the business succeeds or fails will come down to you.
In the early days of the company, many entrepreneurs will find themselves taking care of everything related to the business. As the business grows, they can start to hire others who can assist in particular areas to help the business thrive. For example, they might hire marketing or accounting professionals.
The Principles of Entrepreneurship
The principles of entrepreneurs focus on building a business. You need to focus on a few key areas to achieve success.
- You need to know how to evaluate the market and find an opportunity for success. This requires creative thinking and a deep understanding of the customer.
- You also need leadership skills. A successful entrepreneur not only has a great idea that can lead to professional success, but you also need to have the leadership skills to excite others about your vision so you can encourage them to join your team and help you work towards the realization of your idea.
- Entrepreneurship also involves understanding people. Not only do you need to have strong leadership skills, but you also need to know how to connect with people so that you can create teams that will work well together. You know that building a team is not just about hiring the best in the field but about hiring people that will be able to achieve great things together. You also need to understand other business leaders so that as you network, you can help excite them about your vision and build your network and your customer base.
- Perseverance also needs to lie at the foundation. Entrepreneurship is not easy, though many find the reward to be great. There are often ups and downs as you struggle to make a dent in your target market and build your client base. You need to be willing to put in the long hours and make the endless phone calls that will help you establish your organization, even when nothing seems to go right.
- Being an entrepreneur requires understanding business from all directions. Since you will take over roles across the business until you begin to grow, you need to have a working knowledge of all the different components of a business, including marketing, networking, sales, customer service, finance, and product development.
A successful entrepreneur needs to demonstrate expertise in a variety of areas. Building a business from the ground up is the dream of many professionals, but the work it takes should not be underestimated.
Examples of Entrepreneurship
We can see entrepreneurship across all industries. Bill Gates was an entrepreneur who developed Microsoft, while Elon Musk is an entrepreneur who has spearheaded the development of electric cars and other inventions for the future. Different types of entrepreneurs have shaped our modern world, creating the technology and inventions that we use every day.
What is Intrapreneurship?
Intrapreneurship works in a slightly different space. An intrapreneur often works at a large, established company. Rather than just working among the management of the existing structure, however, the intrapreneur functions more like the leader of a startup in an offshoot of the company.
These professionals take on a leadership role with regard to their project or team. They will focus on a particular product or initiative that functions separately from the main focus of the business.
You can imagine an intrapreneur functioning similarly to an entrepreneur but within the confines of an existing company. They help their established organization develop in new areas and find additional ways to expand.
The Principles of Intrapreneurship
Intrapreneurship calls for professionals who have certain traits that will help them excel in these leadership positions. You will find that many of these principles have similarities or overlap with the principles of quality entrepreneurship.
- Intrapreneurs must be excellent leaders. Those interested in these types of positions must know how to inspire the people around them to work towards a common goal. They do not want to only direct team members to complete certain roles but must also inspire them to seek out the vision for themselves and feel passion for the project.
- Competency and insight must also play an important role in breaking into a new market. Intrapreneurs must be able to uncover opportunities for business and see how the company can pivot to excel in these new spaces.
- Those who want to be intrapreneurs must also be budget conscious. Although they have the backing of the existing company, intrapreneurs must also be cognizant of how much they spend on their projects. The leadership of the company will want to see results and ROI, and that means investing time and resources wisely.
- Those who want to excel as intrapreneurs also need to know how to connect with their target customers. Entering a new area within the industry requires intrapreneurs to find new opportunities and a space where customers have an unmet need. This calls for a visionary who astutely understands the wider brand and the needs of customers.
These principles will guide intrapreneurs as they look for ways to help businesses build a new segment of the company from the ground up.
Examples of intrapreneurship
Although the term ‘intrapreneur’ might seem new to many, these types of professionals have been around for a while. You can see a great example with Google. The business started as a search engine, but then had a separate team, headed by an intrapreneur, who helped them create Gmail as they shifted to providing an email option for customers.
Similarly, Facebook regularly hosts ‘hackathons’ for employees to give them the chance to pursue projects they feel passionately about. This freedom allows employees to find new spaces to engage customers and improve the social media platform.
Similarities Between Entrepreneurs and Intrapreneurs
As you can see, entrepreneurs and intrapreneurs have a number of similarities between them. The professionals filling both types of roles have an innovative mindset. They are responsible for building something new, and they have a considerable amount of control over how the project is run and whether it will succeed. This calls for professionals who welcome this level of visibility and possess the vision to try something that has not been accomplished before.
These professionals will demonstrate capabilities in leadership and build connections with other professionals. They welcome the responsibility that comes with running a project like this.
Differences between Entrepreneurs and Intrapreneurs
It is worth noting that significant differences do exist between entrepreneurs and intrapreneurs. To begin, an entrepreneur has complete autonomy and authority. Since it is their company, they have no one else overseeing their work. Everything about the company depends on them, from what people are brought on board to the final version of the product before it goes to market.
An intrapreneur, on the other hand, does not have quite the same level of control. Although they are responsible for innovations, it comes with less risk and less autonomy. The professional is still responsible to the upper leadership at the established company. They will need to get their final approval on certain decisions and can potentially be fired from a project. The intrapreneur also does not have to deal with the same level of risk. They have an existing brand and resources that they can build on. Since the intrapreneur does not have complete autonomy over the project, the payoff will also likely be a bit smaller than what an entrepreneur will receive if the idea takes off.
Pros and Cons of Entrepreneur and Intrapreneur
It can be helpful to look at the pros and cons of being an entrepreneur versus an intrapreneur to better understand the difference between them.
- Complete ownership of your business and innovative products
- The final say in all important decisions
- The chance to form your business according to your vision
- A business to realize your own dreams and goals
- Often requires more investment from the entrepreneur without the support of an existing business
- Includes greater risk if the business does not excel
- Often, you have to start without the support of a team
- The chance to be a leader in an entirely new area of business
- Work independently on a project according to your vision
- The backing of an existing brand and resources
- The chance to establish yourself as a leader
- Less ownership over the final product
- Answerable to business leaders
- Less freedom and flexibility in how the vision materializes
Should I Be an Entrepreneur or an Intrapreneur?
Knowing whether you want to become an entrepreneur or an intrapreneur requires carefully evaluating your own work preferences and the type of environment that will help you thrive.
You first need to consider how you weigh the importance of freedom in your work decisions versus the importance of having access to resources. An entrepreneur has complete freedom over the project but will not have existing resources that they can freely tap into. They don’t have anyone requiring reports or meeting certain benchmarks, but they also can’t tap into a pool of resources and budget from a large company. An intrapreneur has the opposite setup. They have access to some resources already, but they will have to answer to the people who hired them to achieve certain goals.
You also want to evaluate the value of work culture. An intrapreneur will enter an existing work culture. Those employed by the company have certain expectations of attitudes, such as hierarchy and formality of dress. An entrepreneur, on the other hand, has the chance to create their own work culture and decide how people at their company will interact with each other. You need to consider whether you do a good job of functioning within an existing structure or if you prefer to create your own.
Finally, another key area to consider is your personal comfort with risk. An entrepreneur must be willing to take on a large amount of personal risk. Often, entrepreneurs raise funds and even invest their own money in their business idea, believing that it will pay off in the end. When the business excels, those personal investments can pay off tremendously well. However, if the business does not excel, it can lead to sunk costs and frustration.
An intrapreneur can access the budget of large corporations. They may have a budget line that can help them make initial hires and then build the new idea. This creates a lower-risk environment for the professional who does not have to worry about making their own investment in the endeavor.
A Degree to Support your Vision
As you plan for the future of your career, the decision of whether you want to become an entrepreneur vs intrapreneur can be a challenging one. Regardless of the path you want to take, earning an MBA from UTC can be an excellent way to gain the training you need to excel. This degree will prepare you for the complexities of your path forward and help prepare you to become the type of leader you want to be. Take a step towards your future by learning more now.