The 4 Types Of Entrepreneurs

#4 Con Artists

In my recent podcast episode with Leighton Healey, we had a robust conversation about entrepreneurship. Leighton is a serial entrepreneur with over 15 years of establishing, launching and growing successful companies. In this article, I share a summary of the insights Leighton shared during the episode.

Entrepreneurship is the buzz word these days.

Many people are quick to call themselves entrepreneurs and generally want to model themselves after Elon Musk, Steve Jobs or Bill Gates. I certainly have been there myself in my early days of entrepreneurship where I dreamed of fame, glory and financial success.

However, not every entrepreneur is the same, an awareness of what type you are or aspire to be is important in making good strategic decisions and finding success.

What is entrepreneurship?

Entrepreneurship is the creation or extraction of value. This creation usually involves the activity of setting up a business or businesses and taking on some financial risks in the hope of scaling it to make some profit and we are in its golden age!

Think about it, 100 years ago, entrepreneurs didn’t have a lot going for them. They needed to either have the skill to build something or have the financial resources to buy something to build any meaningful venture. Think Thomas Edison, Henry Ford or John Rockefeller.

Fast forward to today, the age of the internet and social media, there are now over half a billion entrepreneurs in the world.

The opportunity to build a product or service that can be marketed to millions of people at the push of a button has changed the game. You can see this change reflected in Google’s usage of the term over the decades. Observe the sharp rise at the turn of the millennium.

As the pandemic rage and decimate various industries, more and more people are turning into entrepreneurship, either out of the need to due to a job loss or insight and actions that were taken in response to unique opportunities in the market created by the pandemic.

However, before you plunge into the exciting world of entrepreneurship and start that cool idea you have been thinking about or offer a service you are very good at, it is important to understand what type of entrepreneur you want to be or at least know the different types of entrepreneurs you can be.

Knowing what type of entrepreneur you are or aim to be, depends on your motivations and how you define what success and failure are for the business venture.

Leighton shared his insights on the 4 types of categories entrepreneurs can generally fall into as follows:

Lifestyle entrepreneurs

These are people who start a business to improve their overall quality of life. People in this category prioritize their time, freedom, flexibility and autonomy. Most people who are entrepreneurs will fall into this category. This ranges from your side hustle of writing on the side, influencer marketing, providing coaching services to opening a cafe down the street.

These are people who start a business to improve their overall quality of life.

For lifestyle entrepreneurs, the ‘end’ and the ‘means’ are often the same. Leighton explains this as the end representing what they are trying to achieve and the means being how they’ll get there. These types of entrepreneurs want to live life on their terms and “be their own boss” and success for them is being able to balance that act while making a living.

Exit oriented entrepreneurs

These are people who start a business to sell it. For these types of entrepreneurs, the ‘means’ meaning the sacrifices, decisions, forgone salaries, blood, sweat and tears are justified by the ‘end’. The ‘end’ here as Leighton put it is a future exit that compensates for their effort.

These are people who start a business to sell it.

Success for entrepreneurs like this could be flipping a large apartment complex, taking their business to acquisition by a competitor or a larger company, selling their ownership stake or going public and offering IPOS. Of course, this doesn’t happen all the time, and failure could mean shutting down the business and losing a lot of money.

Legacy oriented entrepreneurs

These are people who start a business to leave something behind of lasting importance and value to their customers, industry, families or communities. In this class of entrepreneurs, you have the Elon Musks, Steve Jobs and Bill Gates of the world whose companies have made a lasting impression at a global level.

These are people who start a business to leave something behind of lasting importance and value.

Entrepreneurs like this often define success as their business making a large scale impact and outliving them. Leighton explained that legacy oriented entrepreneurs typically aim to put a dent in the universe and their business is often their sledgehammer.

Con artists

These are people who love the buzz and allure of entrepreneurship, the coolness factor. These individuals are often obsessed with pretending to be genuine entrepreneurs and Leighton characterized them as people who are quick to print a business card and be the CEO of something that doesn’t do anything.

Con artists are CEOs of companies that doesn’t do anything.

They will often make huge and deceitful promises to attract attention and investor's money while taking away resources from real businesses lead by any of the other 3 types of entrepreneurs. They are often very skilled and charismatic storytellers and often story-tell their way into teams and investor's pocketbooks.

It is important to make these distinctions because it affects how you make decisions and whom you take advice from. Leighton gave an example of this about legacy oriented entrepreneurs often saying things like “your business are like your children, they shouldn’t die before you do”, this advice makes sense for a legacy entrepreneur but makes zero sense for a lifestyle entrepreneur.

Leighton was however quick to stress that these categories are not monochrome, it isn’t a perfect science. Some people have characteristics of all four types of entrepreneurs but generally will lean heavily towards one or the other. The best way to know which category you fit best into is by asking the fundamental question of how you define success and failure.