Entrepreneur vs. Intrapreneur: What’s the Difference?
An entrepreneur and an intrapreneur are terms used interchangeably to describe a person who promotes and nurtures innovations. Although they share the same goal and similar skills and characteristics, they are different.
Some qualities shared by entrepreneurs and intrapreneurs include conviction, creative thinking, zeal, insight, problem-solving, vision or forward-thinking skills, and resourcefulness.
While ‘entrepreneur’ is common to everyone, the word ‘intraprenuer’ is not so common. Even Google, when you search for the term ‘intrapreneur,’ asks if you meant the term ‘entrepreneur’ instead.
The key difference between these two terms is that the entrepreneur launches a business while the intrapreneur is an employee who uses entrepreneurial skills to develop an innovative project at their place of work.
This article will cover the relationship between the entrepreneur and entrepreneur, including their key differences and similarities.
What is an Entrepreneur?
An entrepreneur is an individual with a business idea of starting a new business venture to create and run their own company.
The rewards and risks of creating your own business as an entrepreneur fall favorably or not depending on the outcome, as they have complete freedom and responsibility.
There are different types of entrepreneurs, such as:
- First generation Entrepreneurs
- Small Business Entrepreneurs
- Scalable Startup Entrepreneurs
- Large Company Entrepreneurs
- Innovative Entrepreneurs
- Lifestyle Entrepreneurs
- Social Entrepreneurs
- Imitative Entrepreneurs
- Researcher Entrepreneurs
- Manufacturing Entrepreneurs
- Buyer Entrepreneurs
- Trading Entrepreneurs
- Hustler Entrepreneurs
A successful entrepreneur applies an entrepreneurial mindset and skills to initiate new ideas, coordinate resources, provide value, and develop a successful product or service in building their own startup company. And still many people ask “Are entrepreneurs born or made?“
An entrepreneur takes risks. Many entrepreneurs lead the market in their respective industries as the entrepreneurial spirit promotes change and new ideas to take the market by storm.
To create, launch, and manage a successful business as an entrepreneur, you need to start small as a small business and then grow and develop your business.
Entrepreneurship is a vital resource and begins with a new idea and a business plan that eventually develops into new businesses.
After a business plan has been drawn up, the next step is to define the business goals of your new enterprise, hire employees, and constitute a leadership team to run the business.
What is an Intrapreneur?
Intrapreneurs work to foster innovation in an existing organization. They are characterized by less autonomy, defined by the success of the product or idea in the market.
A successful intrapreneur applies entrepreneurial skills over time to create and develop a new idea in an already existing company. As an intrapreneur, you are isolated from the risks of running the business.
So, in essence, as an intrapreneur, you function as an entrepreneur. The only downside is that you are confined to the organization where you work and bound by that organization's defined goals and objectives.
As an intrapreneur and an employee of an organization, you are poised to make a significant impact when allowed free hands for critical thinking to introduce creativity and innovation into the company's product or service until they successfully bring the desired outcome.
Intrapreneurs help companies identify and take advantage of emerging opportunities. Large corporations now appoint intrapreneurs to help bring excellence to their operations and help them gain a competitive advantage.
Shared Traits Between Entrepreneurs and Intrapreneurs
As an entrepreneur or intrapreneur, you need to drive innovation when possible.
Here are some of the shared traits by both entrepreneurs and intrapreneurs in their respective worlds:
Excellent leadership skills are one trait both entrepreneurs and intrapreneurs share in common. These leadership qualities help turn a new idea into a successful product, service, business, or company change.
To run a successful business, either as an entrepreneur or intrapreneur, you need to effectively motivate people around you and help them see the goal. A sound and respected leader can only do this.
Effective leadership skills and positive feedback, communication, and motivation all work together to help guarantee a successful outcome of your business ideas.
Adaptability is critical for both successful intrapreneurs and entrepreneurs. Even the best strategies encounter problems as much as there is no easy road to success.
These problems are roadblocks that tend to derail all your business goals and objectives. You can adapt to the most stringent conditions that help define your success.
Lasting success requires you to be able to tweak your stand and change direction swiftly in either of the two career paths, as quick decisions are needed to solve problems.
Intelligence is one of the essential traits between an entrepreneur and an intrapreneur. It requires a thorough and detailed understanding of the skills and tools needed to carry out a project or run a business.
Whether it is to start a new business or to make changes to how a company operates, intelligence is one trait that will be particularly helpful to help you achieve success and make your business plans into reality.
Intelligence works best when paired with vision. The ability to recognize and capitalize on trends in the market effectively and emerging opportunities is one skill that is required of both an entrepreneur and intrapreneur.
Key Differences Between Entrepreneurs and Intrapreneurs
Intrapreneurship is a strategic tool that businesses utilize in their structure to bring innovation and fresh ideas to their various processes and operations or come up with an entirely new concept.
On the other hand, entrepreneurship relies solely on decision-making. Entrepreneurs take all they have with significant well-calculated risks to develop a great idea to drive an entirely new business.
In a business setup, entrepreneurs and intrapreneurs differ considerably in how they are set up and their critical role in the business.
Some key differences between entrepreneurs and intrapreneurs include:
1. The Setting of Goals
To set goals to guide their business, entrepreneurs rely on their vision and capabilities to study and identify market gaps that their goals aim to exploit.
Intrapreneurs, on the other hand, depend on other top leaders and individuals in management to define and set goals to drive the company.
Intrapreneurs are company employees, so they are often limited in decision-making to their autonomy over the business. Its process is controlled and limited, spanning how they work and operate in the organization.
Entirely, this is not bad for intrapreneurs as the checks and balances that senior managers and executives bring help them maintain their focus on the goal ahead.
Unlike intrapreneurs, entrepreneurs have relatively free reign at the top as they enjoy unlimited and unchecked autonomy. It is beneficial as entrepreneurs are at the center of all the decision-making processes and have a free hand in bringing their ideas to reality.
3. Access to Resources
Entrepreneurs rely solely on the network they built over the years in their personal space and resources to pave the way for them in the business space. It implies that they have limited access to resources, one factor that is a cause of concern for entrepreneurs.
On the other hand, intrapreneurs have somewhat unlimited access to resources, capabilities, and insights from the vast majority of employees attached to the company as they work under an already existing organization.
The unlimited access to resources that intrapreneurs enjoy is an advantage over entrepreneurs, as they are free to dream as long as it is under the company's internal processes.
In the case of raising capital, entrepreneurs are left to source money for their businesses themselves as they do not enjoy the security of an already built and existing organizational structure.
Conversely, intrapreneurs do not need to raise funds as the company's structure provides all the capital required to function optimally. Intrapreneurs enjoy better job security than entrepreneurs as long as they keep their employers happy.
4. Mitigation of Risks
Entrepreneurs and intrapreneurs all undertake some level of risk in their day-to-day operations, but the significance and type of these risks vary between the two career paths.
Ambitious entrepreneurs are the most vulnerable to the highest level of risks. They often put themselves in fragile and compromising positions, such as quitting their standard day job to run their own business or investing all their savings into the business.
These categories of entrepreneurs face the most pressure and undertake the most risks.
An intrapreneur also experiences a significant amount of risk. Still, it is nothing compared to those undertaken by entrepreneurs.
The intrapreneur's risks depend on the business or company's failure. They are isolated from these risks as long there is a positive outcome.
As an intrapreneur, a failed business or venture can be a significant dent and stain your professional reputation and career. However, all your financial remunerations remain intact, so it is a lesser risk.
5. Approach to Failure
The approach an entrepreneur and intrapreneur take to failure and the angle they view failure differ between these careers.
Entrepreneurs have a higher tendency to fail than it is for intrapreneurs working in a built company. It is a major difference between them.
When deciding to enter entrepreneurship, you need to be ready to accept the risks of failure, as you are ultimately responsible for all the losses and mistakes encountered while running your business.
Still, you need not fear failure, as it should be seen as part of the journey to a successful outcome.
Intrapreneurs, on the other hand, need not fear their mistakes or failure as it often has little or no effect or consequence on the company for whom they work but needs to be checked so that it does not become a recurring event.
If properly managed, the failures associated with intrapreneurs can serve as means for companies to learn and better understand the needs and expectations of their customers and increase their product and service delivery.
Companies can also identify potential customers and vulnerable positions in the market or industry where they are based and exploit them.
6. Safety Nets
Regarding safety nets, intrapreneurs enjoy more safety and protection than entrepreneurs do. A single poor outing in the market or significant decline in sales can translate to the end or closure of the business for entrepreneurs.
As an entrepreneur, all your decisions must be carefully and meticulously taken and weighed for potential outcomes. It is difficult to recover from a wrong decision in time, especially during the early stages of a business.
For intrapreneurs, their established organizations provide them with the needed safety nets and financial safety to fall back on when making risky decisions that can go both ways.
The likely impact a failed project carried out by an intrapreneur would have on the entire organization is minimal. So, it is safer to experiment with new ideas as an intrapreneur than an entrepreneur, as you have significant backing.
Steve Jobs identified a failure in his company as not necessarily bad as it allows them to learn from it and better understand what their customers want and expect from them as a business.
7. Financial Return
Entrepreneurs and intrapreneurs enjoy financial returns from their crucial roles in the business sphere.
Entrepreneurs enjoy higher financial benefits compared to intrapreneurs. As an intrapreneur, you are an employee; there is a limit to how much you can get as a financial return.
Irrespective of how innovative your business ideas are, you can only earn a small percentage of your organization’s profit.
As an entrepreneur, you own your own business and are responsible for its success or failure. You enjoy unlimited financial benefits as your business grows. There is no limit to what financial return you can take home.
Should I Be An Entrepreneur or Intrapreneur?
Deciding on what side of the entrepreneurs vs. intrapreneurs debate to choose for your career path is tricky. Both careers have unique advantages and disadvantages for you to consider.
Ultimately, your choice should go down to what works best based on your business skills and knowledge.
If you fall under the category of people with a great network of people, know how to solve problems, and have free and ample time, then your decision should tilt towards being an entrepreneur. They are the needed qualities for success as an entrepreneur.
Successful intrapreneurs need to have entrepreneurial skills and the ability to form new ideas and products for an existing company and help them function more efficiently.
Being an entrepreneur means you have complete freedom and bear both the good and bad outcomes of the business. You need to keep this in mind in your choice.
Unlike entrepreneurs, intrapreneurs get little or no credit for their ideas. However, you are safely isolated from the outcome of the business as you are not directly in charge.
So ultimately, choose the career path that best suits your unique capabilities and provides maximum satisfaction.