Does the startup world need fewer “entrepreneurs”?
I was having coffee with an investor the other day, and we got into talking about the need for more “business people” in our Nairobi — and perhaps global? — startup ecosystem. Initially, I didn’t quite understand what he meant, but our conversation prompted me to wonder if there were ways to distinguish business people (i.e., commercial leaders in traditional businesses) from entrepreneurs (i.e., venture-backed empire-builders), even if, admittedly, there may be more overlap in that venn diagram than divergence. But as I considered what the idea of a business person means to me, it seems we could use a few more of these types in modern startup teams.
How might we distinguish?
A business person deeply cares whether the money they’re making adds up to more than the money they’re spending. An entrepreneur often takes pride in having grossly negative unit margins in service of growth.
A business person only raises money when they absolutely must, and considers it an admission of failure to ask people to fund their losses. An entrepreneur chases money as an end in itself and celebrates every fundraise as a significant milestone.
A business person is often obsessed with quality, strives to under-promise and over-deliver, and takes great pride in their work and reputation. An entrepreneur often fakes it ‘till they make it, moves fast and breaks things, and loves to quote Reid Hoffman: “If you’re not embarrassed by the first version of your product, you’ve shipped too late.”
A business person cares about doing the quiet, hard work of building their company, often preferring to stay under the radar as long as possible. An entrepreneur often leads with public storytelling, press-chasing, and award-seeking as a precursor to execution.
A business person invests in a team of trusted, longstanding teammates who can grow with the company at a natural pace, carry culture forward, and mentor new people. An entrepreneur often views their team as a resource to be exploited, alienating teammates who don’t fall into line and demonstrate 24/7 commitment.
A business person usually considers their business a long-term investment and hopes the business can sustain their family and lifestyle for a long time to come, promising autonomy, cashflow, and professional fulfillment. An entrepreneur is often sprinting as fast as possible to an exit, trying to stay one step ahead of burnout.
A business person usually builds locally, at a human scale, with an appreciation for the importance of relationships and giving back. An entrepreneur often starts with ambitions of world domination, looking beyond their “stepping stone” launch market from day one, eager to expand as soon as possible.
While it may seem that I like business people more than entrepreneurs, that’s not true — I have great respect for both. In fact, at various points in my startup journey, I’ve likely behaved like both — sometimes in the same day. But I do know, with each new Uber, Theranos, and WeWork making front-page waves, making a “real” business is looking better and better…