CLASSIFICATION OF ENTREPRENEURS

A. Clarence Danhof Classification:

Clarence Danhof classifies entrepreneurs into four types.
1. Innovative: Innovative entrepreneur is one who assembles and synthesis
information and introduces new combinations of factors of production. They are
characterized by the smell of innovativeness. These entrepreneurs sense the
opportunities for introduction new ideas new technology, new markets and
creating new organizations. Innovative entrepreneurs are very much helpful for
their country because they bring about a transformation in life style.
2. Imitative/ Adoptive: Imitative entrepreneur is also known as adoptive
entrepreneur. He simply adopts successful innovation introduced by other
innovators. These entrepreneurs imitate the existing entrepreneurs and setup their
enterprise in the same manner. Instead of innovating they just imitate the
technology and methods innovated by others. These entrepreneurs are very helpful
in less developed countries as they contribute significantly in the growth of
enterprise and entrepreneurial culture in these countries. Further by adopting the
technology, which is already tested, they generate ample employment avenues for
the youth and therefore they are treated as agent of economic development.
3. Fabian: The Fabian entrepreneur is timid and cautious. He imitates other
innovations only if he is certain that failure to do so may damage his business.
They are very much skeptical in their approach in adopting or innovating new
technology in their enterprise. They are not adaptable to the changing
environment. They love to remain in the existing business with the age -old
techniques of production. They only adopt the new technology when they realize
that failure to adopt will lead to loss or collapse of the enterprise.
4. Drone: These entrepreneurs are conservative or orthodox in outlook. They
never like to get rid of their traditional business and traditional machinery or
systems of the business. They always feel comfortable with their old fashioned
technology of production even though the environment as well as the society have
undergone considerable changes. Thus, drone entrepreneurs refuse to adopt the
changes. They are laggards as they continue to operate in their traditional way and
resist changes. His entrepreneurial activity may be restricted to just one or two
innovations. They refuse to adopt changes in production even at the risk of
reduced returns.
B. Arthur H. Cole Classification:
Arthur H. Cole classifies entrepreneurs as
1. Empirical: He is an entrepreneur hardly introduces anything revolutionary and
follows the principle of rule of thumb.
2. Rational: The rational entrepreneur is well informed about the general
economic conditions and introduces changes which look more revolutionary.
3. Cognitive: Cognitive entrepreneur is well informed, draws upon the advice
and services of experts and introduces changes that reflect complete break from
the existing scheme of enterprise
C. Classification on the Basis of Ownership:
1. Private: Private entrepreneur is motivated by profit and it would not enter those
sectors of the economy in which prospects of monetary rewards are not very
bright. 10
2. Public: In the underdeveloped countries government will take the initiative to
share enterprises.
D. Classification Based on the Scale of Enterprise:
1. Small scale: This classification is especially popular in the underdeveloped
countries. Small entrepreneurs do not posses the necessary talents and resources to
initiate large scale production and introduce revolutionary technological changes.
2. Large scale: In the developed countries most entrepreneurs deal with large
scale enterprises. They posses the financial and necessary enterprise to initiate and
introduce new technical changes. The result is the developed countries are able to
sustain and develop a high level of technical progress. In recent years, some new
classifications have been made regarding entrepreneurs, which are discussed
further.
Following are some more types of entrepreneurs listed by some other
behavioural scientists:
1. Solo operators: These entrepreneurs prefer to set up their business
individually. They introduce their own capital, intellect and business acumen to
run the enterprise successfully. They operate their business mainly in the form of
proprietorship type of concern.
2. Active partners: Entrepreneurs of this type jointly put their efforts to build
enterprise pooling together their own resources. They actively participate in
managing the daily routine of the business concern. As such, the business houses
or the firms which are managed by the active partners become more successful in
their operation.
3. Inventors: These entrepreneurs primarily involve themselves in Research and
Development (R and D) activities. They are creative in character and feel happy in
inventing new products, technologies and methods of production
4. Challengers: Entrepreneurs of this type take challenges to establish business
venture as mark of achievement. They keep on improving their standard and face
boldly the odds and adversities that come in their way. They use their business
acumen an d talent to convert the odds into opportunities thereby making profit.
According to them, if there is no challenge in life, there is no charm in life.
Challenges make them bold, and thus, they never hesitate to plunge themselves
into uncertainties for earning profit.
5. Buyers (entrepreneurs): These entrepreneurs explore opportunities to
purchase the existing units which may be seized or are in running condition. If the
units they purchase are sick they 11 turn them around using their experiences,
expertise an d business acumen. By purchasing these units they make themselves
free from the hassles of building infrastructures and other facilities.
6. Life timers: These entrepreneurs believe that business is the part and parcel of
their life. They take up the business to reunite successfully as a matter of ego
satisfaction. They have a strong desire for taking personal responsibility. Family
enterprises which thrive due to high personal skill are included under this
category.
Intrapreneurship
The term intrapreneurship refers to a system that allows an employee to act like an
entrepreneur within a company or other organization. Intrapreneurs are self-
motivated, proactive, and action-oriented people who take the initiative to pursue
an innovative product or service.
 BASIS FOR COMPARISON ENTREPRENEUR INTRAPRENEUR
Meaning Entrepreneur refers to a Intrapreneur refers to
person who set up his an employee of the
own business with a organization who is in
new idea or concept. charge of undertaking
innovations in product,
service, process etc.
Approach Intuitive Restorative
Resources Uses own resources. Use resources provided
by the company.
Raised by him. Financed by the
Capital company.

Newly established An existing one

Enterprise

Independent Dependent
Dependency

Borne by the Taken by the company.

Risk entrepreneur himself.

Works for Creating a leading Change and renew the

position in the market. existing organizational
system and culture.

Technopreneurship

Technopreneurship is one of the major extensions of entrepreneurship. Technopreneur is a

new age entrepreneur who makes use of technology to come out with something new to make
some innovation. Once the person succeeds in it, s/he exploits his/her achievement in the
market to make money.

Entrepreneurs vs. Technopreneurs

Entrepreneur
•Likes to compete
•Is a self-starter
•Is able to do many things at once
•Is creative, and has dreams and goals
•Likes to work for him or herself and be in control
•Is motivated by a strong desire to achieve and attain financial success
•Focuses his/her attention on the chances of success rather than the possibility of failure

Technopreneur
•Likes to innovate
•Is part of a team
•Is able to do many things at once, but chooses to delegate
•Is innovative and has a greater vision
•Likes to be the one to control innovation and be part of an evolution
•Is motivated by a strong vision and his passion to innovate
•Takes failure in stride and knows it will lead to success if correction can be made
International Entrepreneurship

The term international entrepreneurship was originally related to the way technological
advances and cultural awareness allowed new ventures to access untapped foreign markets. It
comprises novel and innovative activities that cross borders with the aim of creating value
and growth in business firms. As such, it refers to innovative activities pursued by a firm
across borders. Innovative encompasses the value-seeking component, as firms leave their
home country to seek out new opportunities in unknown or unexplored markets

Cultural Entrepreneurship

“Cultural Entrepreneurs are cultural change agents and resourceful visionaries who organize
cultural, financial, social and human capital, to generate revenue from a cultural activity.
Their innovative solutions result in economically sustainable cultural enterprises that enhance
livelihoods and create cultural value and wealth for both creative producers and consumers of
cultural services and products.”

Cultural Entrepreneurship is an economic as well as socio- culture activity based on

innovation, exploitation of opportunities and risk taking behaviour

Ecopreneurship ( Green Entrepreneurship)

Ecopreneurship is a term coined to represent the process of principles of entrepreneurship

being applied to create businesses that solve environmental problems or operate sustainably.
Ecopreneurship is deliberate human innovation to expand the supply of natural resources
and improve environmental quality

Social entrepreneurship

Social entrepreneurship is an approach by start-up companies and entrepreneurs, in which

they develop, fund and implement solutions to social, cultural, or environmental issues. This
concept may be applied to a wide range of organizations, which vary in size, aims, and
beliefs. Social entrepreneurs combine commerce and social issues in a way that improves the
lives of people connected to the cause. They don’t measure their success in terms of profit
alone – success to social entrepreneurs means that they have improved the world, however
they define that.

Agripreneurship

Agripreneurship defined as “generally, sustainable, community-oriented, directly-

marketed agriculture. Sustainable agriculture denotes a holistic, systems oriented approach to
farming that focuses on the interrelationships of social, economic, and environmental
processes”. Agripreneur defined as “entrepreneur whose main business is agriculture or
agriculture-related” Agriculture + Entrepreneur = Agripreneur
Meaning of Project
A project is a time-bound intervention consisting of a set of planned and interrelated
activities executed to bring about a beneficial change. It has a start and a finish, involves a
multidisciplinary team collaborating to implement activities within constraints of cost, time
and quality, and has a scope of work that is unique and subject to uncertainty. Projects link
policy initiatives at a higher level (eg national or sectoral) with a specific problem faced by a
target group of local-level stakeholders or by institutions or organizations.
Project selection starts from where project identification ends. After having some project
ideas, these are analysed in the light of existing economic conditions , the government policy
and soon. A tool generally used for this purpose is, what is called in the managerial jargon,
SWOT analysis. The intending entrepreneur analyses his/her strengths and weakness as well
as opportunities/competitive advantages and threats/challenges offered by each of the project
ideas. On the basis of this analysis, the most suitable idea is finally selected to convert it into
an enterprise. The process involved in selecting a project out of some projects is also
described as the “zeroing in process”.

Project Report, contents and formulation

Project Report

Project report or business plan is a written statement t of what an entrepreneur proposes to

take up. It is a kind of guide frost or course of action what the entrepreneur hopes to achieve
in his business and how is he going to achieve it. In other words, project report serves like a
kind of big road map to reach the destination determined by the entrepreneur. Thus, a project
report can best be defined as a well evolved course of action devised to achieve the specified
objective within a specified period of time. So to say, it is an operating document.
Contents of a project report
A good project report should contain the following components.
1. General Information: Information on product profile and product details.
2. Promoter: His/her educational qualification, work experience, project related experience.
3. Location: Exact location of the project, lease or freehold, locational advantages.
4. Land and building: Land area, construction area, type of construction, cost of
construction, detailed plan and estimate along with plant layout.
5. Plant and Machinery: Details of machinery required, capacity, suppliers, cost, various
alternatives available, cost of miscellaneous assets.
6. Production Process: Description of production process, process chart, technical
knowhow, technology alternatives available, producti on programme.
7. Utilities: Water, power, steam, compressed air requirements, cost estimates, sources of
utilities.
8. Transport and Communication: Mode, possibility of getting, costs.
9. Raw Material: List of raw material required by quality and quantity, sources of
procurement, cost of raw material, tie-up arrangements, if any
10. Manpower: Manpower requirement by skilled and semi -skilled, sources of manpower
supply, cost of procurement, requirement for training. and its cost.
11. Products: Product mix, estimated sales, distribution channels, competitions and their
capacities, product standard, input -output ratio, product substitute.
12. Market: End-users of product, distribution of market as local, national, international,
trade practices, sales promotion devices, and proposed market research.
13. Requirement of Working Capital : Working capital required, sources of working
capital, need for collateral security, nature and extent of credit facilities offered and available.
14. Requirement of Funds: Break-up of project cost in terms of costs of land, building,
machinery, miscellaneous assets, preliminary expenses, contingencies and margin money for
working capital, arrangements for meeting the cost of setting up of the project.
15. Cost of Production and Profitability of first ten years.
16. Break-Even Analysis
17. Schedule of Implementation
Formulation of a project report
The process of Project formulation can be divided in to eight distinct and sequential
stages. These stages are:
1. General Information.
2. Project Description.
3. Market Potential.
4. Capital Costs and Sources of Finance.
5. Assessment of Working Capital Requirements.
6. Other Financial Aspects.
7. Economic and Social Variables.
8. Project Implementation.