Difference between Entrepreneur and Manager

An entrepreneur is the owner of the company. He is someone who sets up the foundation of the company. He brings in ideas, innovations and makes decisions in terms of running the company. He is the prime decision-maker. An entrepreneur is responsible for taking risks in the business. Risks include financial, operational, and other unforeseen contingencies related to the business. The entrepreneur is the true-leader of the company. His primary focus is on achievements and profits.

A manager, on the other hand, is an employee of the organization. He evades the element of any form of risk-taking related to the business. Instead, he is responsible for the smooth functioning of his subordinates. A manager may be responsible for a group, a specific department, or a region. He handles and manages all the administrative functions running under him and ensures the organizational goals and targets are met. He does not have to make binding financial decisions regarding the organization. A manager is employed to run an organization or company and does not have to decide upon its fate.

Let us find out what are the key differences between an entrepreneur and a manager based on some important aspects.

Difference between Entrepreneur and Manager

Position in the Company

An entrepreneur is positioned in a company as a visionary. He is the leader and the owner of the business. All the risks associated with the company are borne by him.

A manager, on the other hand, is placed in the organization as a salaried employee. He does not bear any risks.


An entrepreneur’s focus is primarily long-term. He is focussed on setting up the business,  sustaining it, and expanding it. His focus determines the existence and growth of the business organization.  He has long-term objectives and works towards reaching the same.

A manager is an employee who has short-term objectives in terms of the organization. A manager’s assigned job is to ensure the regular smooth-functioning of the company, and hence, his//her objectives and duties are not far-fetched.


An entrepreneur is motivated to set up his/her own venture. This means that his motive is to set up a new venture due to his own personal choices.

A manager, on the other hand, is motivated by the power his position holds. His only motive in the organization is to dispense the services that are assigned to him and prove to be a competent employee.

Element of Risk

The possibility of risk-taking is probably one of the most significant aspects of being an entrepreneur. In setting up a completely new venture, an entrepreneur poses himself/herself to the risks and uncertainties of the business. Whether the risks are related to the finances, legal operations, or profits, it is the entrepreneur who bears the full of it.

A manager does not have to take risks in the organization. He has a predefined set of duties and a limited job role that he has to dispense and then receive definite perks in return.


The income of the entrepreneur is rather uncertain. His income from the organization depends upon how well the organization makes the profits. Setting up an organization from scratch has its uncertainties. That also makes the profit-yielding capacity very unpredictable.

The income of a manager of a company is certain and fixed. A manager in an organization is a middle or high order employee. Hence, he/she is a salaried employee on the company’s payroll. As a result, by the end of each month, a manager receives a fixed amount as remuneration as well as promised perks that come with his position.


An entrepreneur has to take necessary decisions in terms of the innovations in the organization. The business is the entrepreneur’s brainchild. Hence the decisions regarding product offerings, product development, etc., are made by the entrepreneur. The entrepreneur decides ways by which the evolving demands in the market can be met.

A manager does not have to make any innovative inputs into the organization. A manager, however, has the responsibility of carrying out the decisions taken by the entrepreneur. Hence, it can be rightly said that a manager puts the entrepreneur’s idea and gives them shape in the real world. He/she is responsible for the proper execution of these ideas.


A successful entrepreneur is supposed to have a number of characteristic traits. He/she should have great leadership skills. He/she should be ready to take risks and have an extremely innovative bent of mind. In addition, an entrepreneur should be analytical and patience. He/she should be a good speaker since it is the entrepreneur’s ides to sell his/her business idea to the world and find an establishment.

A manager, however, can have a few inter lapping qualities as that of an entrepreneur. But in essence, to be a good manager in an organization, a person needs to have adequate knowledge in management theories and other aspects. He/she, in most cases, must also have prior practical experience in his field of the job to be hired.


An entrepreneur’s approach to work is more informal in nature. Since he/she is not directly related to the operations and daily execution of tasks, the necessary formality is averse in the entrepreneur’s case.

A manager, on the other hand, is extremely formal in his professional approach. He/she is responsible for administering a coordination a group of employees around him. This requires the manager to maintain a degree of formality and professionalism in his operations.

Decision-making Process

The decision-making process of an entrepreneur is largely intuitive. He/she employs his innovation, ideas, motivation, and natural drive into making decisions for the organization.

A manager, on the other hand, abides by rules and analyzed data. He/she follows proper protocol and hence takes decisions which are calculative and analytical in nature.

From all the above-stated information, a summary table of differences between an entrepreneur and an employee is drawn. It mentions the various bases of difference along with relevant information.




Position Owner Employee
Focus Long-term Short term
Motive Achievement Power
Element of risk Risk-taking Risk-aversing
Income Profits earned Salary
Innovation Yes No
Characteristics Informal Formal
Decision-making Based on intuitions and instincts Calculative decision-making

All the above differences have made it clear that there is a significant difference between manager and entrepreneur. Needless to say, both have considerable importance in any organization. It should, however, be noted that their roles cannot be juxtaposed. Both possess specific skill sets and work on different avenues to keep the growth and daily operation of the organization steady.

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