IBJOpinion

MARCUS: Not all business owners are entrepreneurs

Back to TopCommentsE-mailPrintBookmark and Share
Morton Marcus

Many years ago, Winslow Spoon decided he did not want to work for a big company. He did not like taking orders from people who knew less or had less vision than he did about the business. He felt he could do a better job, earn more for his family, and have less hassle in his life if he went out on his own.

Thus, Winslow started his own business with his own money and some borrowed from his parents and an aunt. He worked many hours to build the business, where he now has more than 20 employees. The business has survived the recent economic crisis and looks to be OK for the foreseeable future.

The Spoons live well, but not extravagantly, in southeastern Indiana. They see the Reds and the Bengals in Cincinnati from time to time and get to Indianapolis once or twice a year for shopping and entertainment.

Winslow thinks of himself as an entrepreneur, the rock upon which America is built. He fits the classic definition of an entrepreneur: a person who organizes, operates and takes the risks associated with an enterprise. Nonetheless, some say Winslow stopped being an entrepreneur many years ago. Today, they say, he is just a business owner and no longer an entrepreneur.

Winslow’s critics believe an entrepreneur is one who actively undertakes new efforts, a person who might be called a serial business innovator. The SBI often thrives on getting a business going, making it a success, then selling it off by taking the firm public, or selling it to private investors or to another firm. Often, the SBI turns around and starts another business, enjoying the challenges of a startup activity.

The SBI seeks to expand, to diversify and to accept new risks. The business owner, by contrast, often remains in the same place, doing the same thing year after year. While the SBI seeks new seas and new ports, the business owner lies at anchor, subject to the tides.

Winslow should not be thought of as an inferior person because he doesn’t venture into new businesses. He and other steady business owners are truly the rocks of our economy. We depend on them for our daily services. They provide distinctiveness for our communities. But rocks are fundamentally stable entities. Their importance is unquestioned, but they move and change only when subjected to earth-shaking events or the forces of persistent erosion.

The steady business owner may disregard opportunities and take too few risks. This behavior may deny society important gains. When the business owner shies away from expanding or diversifying, he or she may be under-using the resources, skills and knowledge already resident in the firm. This “prudence” may open the opportunities that SBIs seize.      

Serial business innovators, by contrast, may take too many risks and squander resources. But their failures may provide important information about opportunities and lessons for others to follow. If my attempts to sell stock tips as messages in fortune cookies fail, you might recognize that such an enterprise can easily crumble. Failure is not necessarily without value.

Our economy needs both content business owners (Winslow) and aggressive entrepreneurs. Should we, however, subsidize one or the other, or both? Because the mythology of small business is strong in this country, we have massive programs that aid and favor existing small and startup businesses. But do we have enough factual information to justify this favoritism? Or do we suffer from a Disney syndrome, in which everything small is considered cute and worthy of both our sympathies and protection?•

__________

Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at mmarcus@ibj.com.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. Hello Dear Are you tired of Seeking Loans and Mortgages,have you Been Turned down constantly By your banks and Other Financial Institutions or Micro Finance scheme. This is let you know with 100% guarantee that we Offer loans ranging from $1,000 Minimum to $1,000,000.00 Maximum at 3% interest rate per Month. We give out LOANS for developing business. a competitive edge/business expansion. email address: michealscottloan124@gmail.com We offer the following kinds of loans and many more; * Personal Loans ( Unsecured Loan) * Business Loans ( Unsecured Loan) * Consolidation Loan * Combination Loan * Home Improvement * Xmas Loans for contact to seek for loan email this email address: michealscottloan124@gmail.com Thanks

  2. My name is Mr Henry Josh and i live in the USA California and life is worth living right now for me and my family and all this is because of one man sent by GOD to help me and my family, i once had a life filled with sorrow because my first SON needed a kidney transplant and all our savings were going towards his medications and this normally leaves us with no money to pay our bills or even put enough food on our table and our rent was due and no funds to pay these bills and life felt so unfair to me and every night my wife will cry herself to sleep every night until one day, i was browsing through yahoo answers and i saw a striking advert of a man that gives out personal loans and that the offer is opened to all and i have heard so many things about internet scams but at this point of my life, i was very desperate and ready to take any risk and at the end of the day, i applied for this loan and from one step to another, i got my loan within 12 hours through bank transfer and you know, it was all like a dream and i called Mr Daniel Jones A Man who is the GOD sent lender i found and said, i have received my loan and he smiled stating that to GOD be the glory and i was so shocked as i have never ever seen anyone with such a GOD fearing and kind heart and today, i am the happiest man on earth because by GOD’S grace, my SON kidney transplant was successful and today he is healthy, i and my family are living very comfortable and happy and if you are in my former situation or in serious and legitimate need of a loan, you can reach this GOD sent lender via fidelityloanfirm@outlook.com

  3. Greetings to everyone reading this comment!!! I am Greg William by name. I am out here to recommend the effort of Mark Oscar,I was in need of a consolidation loan amount of 50,000 and as soon as I got in contact with Mark Oscar Loan Firm on Wednesday last week and on Friday last week as well I receive an alert from my bank(Royal Bank of Scotland Group) that the fund was transferred,I want everybody on this site to contact Mark Oscar now via email on how to get a loan because I got my loan from them and I am very happy,so contact them now. Oscarloanfinance@hotmail.com Thanks!!!!!!

  4. Elected officials, like Mourdock, get vested in 8 years. It takes 10 years for all other public employees, most of whom make a lot less money. So much for the promise to finish out his term.

  5. Great state treasurer and a good man!! Just curious if the folks who didn't quite understand his quote would like to tell my daughter-in-law that God didn't intend her! Mourdock's comment was correct but twisted and the article didn't mention that his opponent and the press let the impression stand that Mourdock meant that the rape was intended. Stupid people!!

ADVERTISEMENT