Entrepreneurs comprise a big part of the U.S.’ economic engine, and some are driven by different reasons.
Whether you work for an entrepreneur, are considering taking a job for one, or are interested in investing in their business, learning about the different types and operating styles of entrepreneurs will give you insight into the future of their companies, says Tony Zorc (www.tonyzorc.com), author of Iconoclasm: A Survival Guide In The Post-Pandemic Economy and a tech entrepreneur.
“There are three types of entrepreneurs, and understanding each one will help you decide whether you want to get involved with them,” Zorc says. “That’s even more important when you consider the high failure rates of start-ups and the uncertainty of the post-COVID economy.
“Analyze each type of entrepreneur and what you can expect of them in four areas: the management priority or prime directive; the customer experience; employee working conditions and culture; and management longevity.”
Zorc describes the three types of entrepreneurs:
- The investor. Zorc says the investor-driven entrepreneur is not concerned with the mission of the company and is not tied to the company emotionally. This type of investor’s main aim is to sell his or her shares at a favorable price. “The customer experience can be horrible when the investor entrepreneur is looking to sell quickly,” Zorc says. “They may spend a lot of money on marketing to obtain customers quickly and without having the desire to keep them long-term. Bringing in customers quickly can look like high growth to a potential buyer of the company.”
Zorc says employee turnover is usually high as they are seen as a means to a return on investment. “The ego of the investor entrepreneur is often the real force behind the company’s growth,” he says. Zorc’s examples of this type of investor are Bill Gates, Warren Buffett, and Jeff Bezos.
- The innovator. “This type is really an artist in the form of a business person,” Zorc says. “They’re obsessed with how their business and technology can change the world and the marketplace. Being a customer of this type can be fantastic since they care about what you think about their product.” Customers of the innovator-led companies often form communities around consumption of the product to share their experiences.
Zorc says working for an innovator-driven entrepreneur is a good experience if one shares passion for their mission. “They don’t typically look to sell their equity in their company, unless they see it as necessary for the mass adoption of their product and achieving their vision,” Zorc says. Zorc’s examples of innovator-driven entrepreneurs are Henry Ford, Steve Jobs, Elon Musk and Howard Schultz.
- The missionary. “Their primary focus is on making things better for their customers,” Zorc says. “Return on investment is not the sole reason they went into business. They will adopt and drop technologies as needed to benefit their customers. They care about the price of their products and services, and because they want more people to experience the mission, they tend to price things low.”
Mission-driven entrepreneurs, Zorc says, create good work cultures because they realize having productive, happy employees is critical to the long-term happiness and loyalty of customers. “Mission-driven companies tend to be privately held, and the entrepreneur tends to stay with the company most of their working life.,” Zorc says. His examples of missionary entrepreneurs are Michael Dell and Truett Cathy.
“An entrepreneur can drive the vehicle any way they choose, based on the purpose behind their goals,” Zorc says. “Getting a handle on whose driving – and what’s driving them – is critical before you decide to become a passenger.”
About Tony Zorc
Tony Zorc (www.tonyzorc.com) is the author of Iconoclasm: A Survival Guide In The Post-Pandemic Economy. He is a tech entrepreneur and founder of Accounting Seed. Zorc designed a flexible technology as an accounting software solution and his vision became the platform for his international company, which has sold over 15,000 licenses to customers in numerous industries. In 2018, Accounting Seed was named among CFO Tech Outlook’s Top 10 Accounting Solutions Providers. A graduate of Hope College, Zorc was the Illinois High School Gymnastics Coaches Association senior gymnast of the year in 1992 and a state champion.