LECTURE 2 NOTES

TYPES OF ENTREPRENEURS

Entrepreneurs are classified into different types based on different classifications as

mentioned below:

https://www.iedunote.com/entrepreneurship-types

Based on the Type of Business:

1. Trading Entrepreneur:

As the name itself suggests, the trading entrepreneur undertake the trading activities. They

procure the finished products from the manufacturers and sell these to the customers directly

or through a retailer. These serve as the middlemen as wholesalers, dealers, and retailers

between the manufacturers and customers.

2. Manufacturing Entrepreneur:

The manufacturing entrepreneurs manufacture products. They identify the needs of the

customers and, then, explore the resources and technology to be used to manufacture the
products to satisfy the customers’ needs. In other words, the manufacturing entrepreneurs

convert raw materials into finished products

3. Agricultural Entrepreneur:

The entrepreneurs who undertake agricultural pursuits are called agricultural entrepreneurs.

They cover a wide spectrum of agricultural activities like cultivation, marketing of

agricultural produce, irrigation, mechanization, and technology.

Based on the Use of Technology:

1. Technical Entrepreneur:

The entrepreneurs who establish and run science and technology-based industries are called

‘technical entrepreneurs.’ Speaking alternatively, these are the entrepreneurs who make use

of science and technology in their enterprises. Expectedly, they use new and innovative

methods of production in their enterprises.

2. Non-Technical Entrepreneur:

Based on the use of technology, the entrepreneurs who are not technical entrepreneurs are

non-technical entrepreneurs. The forte of their enterprises is not science and technology.

They are concerned with the use of alternative and imitative methods of marketing and

distribution strategies to make their business survive and thrive in the competitive market.

Based on Ownership:

1. Private Entrepreneur:
A private entrepreneur is one who as an individual sets up a business enterprise. He / she it’s

the sole owner of the enterprise and bears the entire risk involved in it.

2. State Entrepreneur:

When the trading or industrial venture is undertaken by the State or the Government, it is

called ‘state entrepreneur.’

3. Joint Entrepreneurs:

When a private entrepreneur and the Government jointly run a business enterprise, it is called

‘joint entrepreneurs.’

Based on Gender:

1. Men Entrepreneurs:

When business enterprises are owned, managed, and controlled by men, these are called ‘men

entrepreneurs.’

2. Women Entrepreneurs:

Women entrepreneurs are defined as the enterprises owned and controlled by a woman or

women having a minimum financial interest of 51 per cent of the capital and giving at least

51 per cent of employment generated in the enterprises to women.

1. Small-Scale Entrepreneur:

An entrepreneur who has made investment in plant and machinery up to Rs 1.00 crore is

called ‘small-scale entrepreneur.’

2. Medium-Scale Entrepreneur:

The entrepreneur who has made investment in plant and machinery above Rs 1.00 crore but

below Rs 5.00 crore is called ‘medium-scale entrepreneur.’

3. Large-Scale entrepreneur:

The entrepreneur who has made investment in plant and machinery more than Rs 5.00 crore

is called ‘large-scale entrepreneur.’

Based on Clarence Danhof Classification:

Clarence Danhof (1949), on the basis of his study of the American Agriculture, classified

entrepreneurs in the manner that at the initial stage of economic development, entrepreneurs

have less initiative and drive and as economic development proceeds, they become more

innovating and enthusiastic.

Based on this, he classified entrepreneurs into four types:

Innovating entrepreneurs are one who introduce new goods, inaugurate new method of

production, discover new market and reorganise the enterprise. It is important to note that

such entrepreneurs can work only when a certain level of development is already achieved,

and people look forward to change and improvement.

2. Imitative Entrepreneurs:

These are characterised by readiness to adopt successful innovations inaugurated by

innovating entrepreneurs. Imitative entrepreneurs do not innovate the changes themselves,

they only imitate techniques and technology innovated by others. Such types of entrepreneurs

are particularly suitable for the underdeveloped regions for bringing a mushroom drive of

imitation of new combinations of factors of production already available in developed

regions.

3. Fabian Entrepreneurs:

Fabian entrepreneurs are characterised by very great caution and skepticism in experimenting

any change in their enterprises. They imitate only when it becomes perfectly clear that failure

to do so would result in a loss of the relative position in the enterprise.

4. Drone Entrepreneurs:
These are characterised by a refusal to adopt opportunities to make changes in production

formulae even at the cost of severely reduced returns relative to other like producers. Such

entrepreneurs may even suffer from losses but they are not ready to make changes in their

existing production methods.

TYPES OF SOCIAL ENTREPRENEUR

ocial entrepreneurs represent an exceedingly diverse cross-section of businessmen, both in the

ways that they conduct business and in the goals that they’re seeking to accomplish with their

enterprises. They also differ both in the various means that they employ to enhance social

wealth and the strategies that they utilize to facilitate those means. Social entrepreneurs work

exceptionally hard to produce lasting solutions that will effect permanent change in the lives

of the people they hope to impact. These brief capsule summaries describe four of the most

common types of social entrepreneurs:

The Community Social Entrepreneur

This sort of social entrepreneur seeks to create ventures meant to serve the social needs of a

community within a relatively narrow geographical area. These enterprises are generally

structured around the active participation of people living within the served community.

This sort of entrepreneur has an advantage in that his ventures become ever more sustainable

over time, as there are vested interests for all parties. One sometimes significant associated

disadvantage is that decision-making may be a slower process due to the larger numbers of

people involved.

The Non-Profit Social Entrepreneur

Consequently, any profits made are reinvested into the business to facilitate the further

expansion of services offered. For this sort of social entrepreneur, the social goal(s) are always

more important than mere profit.

While the social entrepreneur is frequently better able to meet his social goals due to the more

ready availability of funds, the very motivation to generate those monies may be

correspondingly lower.

The Transformational Social Entrepreneur

Here, the focus extends to the creation of an enterprise able to meet those social needs not

adequately being met by governments and other businesses. These businesses occasionally

evolve into institutions and the involved social entrepreneur must have the skills and capacity

to administer a large team.

One advantage of being a transformational social entrepreneur is that it can be easier to recruit

excellent volunteers. A not insignificant disadvantage is that it can be far more challenging to

comply with an ever-larger web of interrelated rules, regulations, and politics.

The Global Social Entrepreneur

The global social entrepreneur works toward complete transformation of a social system in

order to meet major social needs and to change the very fabric of society worldwide. The

scope of the global social entrepreneur is international and his aim is to create an enterprise

that will stand the test of time.

If he’s successful, the net advantage will be that neglected or inadequately-addressed social

needs are met. The disadvantage is that there will be far more scrutiny on the business and
how it conducts its affairs. If the enterprise fails to win the necessary support of the global

community, all of its efforts will be for naught.