According to George Bernard Shaw, people fall into three categories: (i) those who make
things happen. (2) Those who watch things happen, and (3) those who are left to ask what did
happen. Generally, entrepreneurs fall under the first category.
Evolution of the Concept of Entrepreneur
The word ‘entrepreneur’ is derived from the French word entreprendre. It means ‘to
undertake’. Thus, entrepreneur is the person who undertakes the risk of new enterprise. Its
evolution is as follows.
Early Period:
The earliest definition of the entrepreneur as a go-between is Marco Polo. He tried to
establish trade route to the far East. He used to sign a contract with a venture capitalist
to sell his goods. The capitalist was the risk bearer. The merchant adventurer took the
role of trading. After his successful selling of goods and completing his trips, the profits
were shared by the capitalist and the merchant.
Middle Ages:
The term entrepreneur was referred to a person who was managing large projects. He
was not taking any risk but was managing the projects using the resources provided. An
example is the cleric who is in charge of great architectural works such as castles, public
buildings, cathedrals etc.
17th Century:
An entrepreneur was a person who entered into a contractual arrangement with the Govt.
to perform a service or to supply some goods. The profit was taken (or loss was borne)
by the entrepreneur.
18th Century:
It was Richard Cantillon, French Economist, who applied the term entrepreneur to
business for the first time. He is regarded by some as the founder of the term. He defined
an entrepreneur as a person who buys factor services at certain prices with a view to sell
them at uncertain prices in the future.
19th Century:
The entrepreneurs were not distinguished from managers. They were viewed mostly
from the economic perspective. He takes risk, contributes his own initiative and skills.
He plans, organizes and leads his enterprise.
20th Century:
During the early 20th century Dewing equated the entrepreneur with business promoter
and viewed the promoter as one who transformed ideas into a profitable business. It was
Joseph Schumpeter who described an entrepreneur as an innovator. According to him
an entrepreneur is an innovator who develops untried technology.
21th Century:
Research Scientists live De Bone pointed out that it is not always important that an
individual comes up with an entirely new idea to be called an entrepreneur, but if he is
adding incremental value to the current product or service, he can rightly be called an
entrepreneur.
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