You’re likely to have heard the term “entrepreneur” used in reference to owning a business. Today, however, they are often interchangeable. There are minor differences between the approaches to business and the mindsets that differentiate the two. One role isn’t better than another. They are both different.
Many business owners like Kenneth Watterworth build businesses around an existing business idea, such as opening a fireproofing company or painting company. Entrepreneurs on the other side are more likely to take on greater risks and pursue innovative solutions to everyday problems. Kenneth Watterworth Westport, CT entrepreneur allows you to add fireproofing to a painting project.
These subtle differences are between entrepreneurs and business owners:
- Motivation. Many business owners start their own companies to make it easier for them to be independent. It is more of a natural progression to turn something they love into a business. Entrepreneurs might have a different vision of the future or a different way of doing business.
- Innovation. Entrepreneurs are not always interested in innovative concepts. They use proven principles to achieve success. They are able to identify their market and focus on their customers and growing their business. Entrepreneurs are known for developing ideas that haven’t been tried. Entrepreneurs challenge the status quo, and they can alter industries or niches when the business grows.
- Growth. Business owners want to grow their business, but they often do so at a slower pace. Entrepreneurs strive for rapid growth and aim to expand their business nationwide or internationally as quickly as possible. Entrepreneurs don’t employ the same strategies as business owners, and often create new markets to compete with other entrepreneurs.
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They both decided to start their own business. This is the common thread. Many personal factors can influence this decision.
- Capability to spot opportunities
- Attitude to take risks
- Personal goals
- Support for the family and social services
You can identify yourself as either an entrepreneur or a business owner. However, you still need to work with the same stakeholders, suppliers, manufacturers and banks, customers, employees, and contractors, as well as other stakeholders. Both see the business opportunity and take action. They learn and adapt to build more profitable businesses that make a profit.
Read: Ken Watterworth Outlines Westport, CT Startup Challenges
Types of business ownership
It is challenging but rewarding to start a business. The fun part of owning a business is creating a name, building your website, selling products, and finding customers. You must also consider incorporation and business ownership.
Your business structure determines how you are taxed and what liabilities you have. It also decides how capital can be secured if you need it.
There are four types of business structures you can choose from:
- Sole proprietorship. The sole proprietorship is an unincorporated entity that does not allow for legal separation between the owner and the manager. It is easy to establish and manage and will likely cost less tax.
- Partnership. A partnership is a partnership in which two or more people own the business. General partnerships assume that the business is divided equally or broken into percentages as agreed upon prior to filing.
- Corporation. Corporation. Taxes are different in each state. So, you might pay more taxes than a sole proprietorship. However, your personal property is protected.
- Limited Liability Company (LLC). An LLC is a hybrid business that combines the benefits of corporations with partnerships. Check out our state-specific guides for California LLC and Texas LLC.
Your business model will determine the type of ownership that is best for you. 9 important steps to create your business plan to find the right one.