Am I an entrepreneur?

The term entrepreneur is frequently abused. Any you-who with $80 dollars and a CodeAcademy class under their belt can become one. The hardest part of incorporating a company is walking down the street to set up a PO Box at the local post office.

But then you have it, creative name and all, and you are asking what’s next. You don’t feel any different. People seem to think you’re something all of a sudden, but that really doesn’t mean anything and you know it. You don’t have funding; not even a product. So, are you really an entrepreneur?

To answer this question you must first answer another question; what does it mean to be an entrepreneur?

In my eyes entrepreneurship boils down to risk. Being entrepreneurial is being willing to make one way bets on things that are as, or more, likely to fail than succeed. It means being liable for these odds, and for others who are dragged into the net of your ambition. It means understanding that there is nothing to catch you if you fall. It means being willing to go down with the ship.

Entrepreneurship was considered a lowly profession for much of history. In the Indian caste system, entrepreneurs were just above farmers; near the bottom of the hierarchy. Pre-enlightenment Europe saw a general disregard for entrepreneurship as too individualistic and lacking in scholarly merit.

It has long been the opinion of history that an entrepreneur is a financial, or personal, risk-taker pursuing individual goals over that of the collective.

It’s interesting that this definition has become so corrupted by the business community. In essence, there are two types of people who are mis-categorized as entrepreneurs: those who have a business, but maintain a full time job and are no more than weekend warriors, and those who create a one-off product that generates some short-term success with no long-term follow through.

A college student programming a mobile game on their computer is sacrificing little more than the time it takes to write the program. He or she is not burdened by the high startup costs and downside risk that make true entrepreneurs so invested in the success of their venture.

This relationship only holds true in the dorm-room stage. Once a VC backs a start up, it is no longer playing with house money. There are investors, there is a real reputation risk and financial risk involved, and there is an expectation of results from employees and the public. There is danger and there are consequences. There is a business.

The number of young millionaires has been increasing steadily, and the average age of people generating yearly income over a million dollars has been decreasing. This says little of the high net worth individuals who have made money selling a fortune in the App Store and are now “unemployed”, sitting on a seven-figure bank account.

Even a free mobile game can make the creator a millionaire in a matter of weeks. A game with 25–30,000 downloads in day can generate residual income that is enough to retire on *though probably not in San Francisco*. This creates a massive upside, with little downside risk.

Looking at these people, it is easy to see them as models of success. However, I would equate this type of victory more with a blackjack player than a savant (though a savant playing blackjack would be bad news for a Casino). The reality is that every game in the App Store has some baseline likelihood of success, and one can only improve the odds so far through novel concepts and intriguing game-play.

Granted, these games take innovation. As with any act of creation, there is a combination of faith and invention that is necessary for something novel to come about. However, innovation and entrepreneurship are not the same thing. An innovation can blossom into an entrepreneurial endeavor and any successful entrepreneur has relied on a fair bit of innovative thinking. Innovation without entrepreneurship does exist, though.

I find myself in this category. Every Saturday I wake up and set myself to work on the same project I have been working on for the last year. It costs me a couple hundred dollars a month to fund, I sacrifice my free time to make it a reality, and it may one grow into a thriving business. But, I am not an entrepreneur, not today.

There is no risk to what I am doing. Maybe one day I’ll look back at this last year and ask myself why I wasted so much time creating something that never saw the light of day. Maybe it will jump start a promising career in startup-land. For now, I’m just a hobbyist with an LLC.