Are you an Entrepreneur or a CEO

It’s long been an assumption that being an entrepreneur qualifies you for the role of CEO and vice versa.

However, this is not always the case.

While it is true that the two roles do have overlapping qualities, both the skillset and mindset requirements of the two positions are very different. Let’s start by taking a look at the role of entrepreneur.

What is an Entrepreneur?

As an entrepreneur you are willing to risk your own financial well-being in order to build a company that could one day be worth much more than your initial investment.

You’re constantly thinking about the market, where your next opportunities lay, and initially you do everything within the business yourself. You have the ability to construct or provide the product/service at ground level whilst simultaneously being able to take a step back outside of the company to see it as a whole.

You are busy raising money and building teams around you as your business venture gains momentum - studying your competitors and starting to identify your ideal customer, and start to market, advertising and selling your product to those individuals or businesses.

No matter the size of the company, you’re constantly in startup mode, wanting to remain as flexible and agile as possible so that you can take advantage of opportunities as they present themselves.

What is a CEO?

While an increasing amount of entrepreneurs are setting up LLCs and calling themselves CEOs, in reality they are a far cry from what the role entails.

Chief Executive Officer (CEO) is the highest ranking executive manager in a corporation or organization. Their responsibility first and foremost is to ensure the continued success of their business, and they hold ultimate decision-making authority.

If you’re a CEO, your goal is to establish a company culture and to determine the overall mission of said company. You can then use that framework to assess all business decisions against, including items such as the hiring of employees and launching of new products.   

As CEO you are much more focused on strategy, implementing what you believe is the best direction for the organization to achieve specific financial goals. You also need to have the ability to dissect finances and read between the lines of your company’s performance.   

You’re in charge of monitoring threats, consumer attitudes, changes in market conditions and opportunities for expansion. Depending on the size of the company, your decisions will be scrutinized by a board of directors, who will be there to both offer advice and make suggestions based on your performance.

What Are the Key Differences?

As you might have already been able to deduce, the difference between the roles is not just in title.

It’s in mindset, outlook and responsibility.

An entrepreneur spends their whole existence building things, whereas a CEO maintains what has been built and nurtures it toward future growth.

Where an entrepreneur is responsible for innovation and visionary ideas, a CEO is more concerned about the here and now. They make sure that the wheels of the company keep turning, or in some instances, stop them from falling off altogether.

Entrepreneurs are usually only accountable to themselves, which means they are both willing and able to take huge risks. Whereas a CEO is responsible to his or her board and shareholders, they cannot make reckless decisions that could alter the fabric of an organization overnight.  

They are constantly assessing risks, tweaking and improving existing products and services, rather than pivoting to new markets and new opportunities.

A CEO’s role is in many ways to systematize many key components of the business that were perhaps only loosely bound together before, shoring up its long-term future.

So, does this mean that an entrepreneur can’t be a CEO? Can you only be one and not the other?

Can an Entrepreneur Become a CEO?

The answer to this question is simple - it depends.

Some entrepreneurs mature as their company grows to a big enough size to require a CEO. They manage to temper their inner creative side and start to focus on protecting what they have built whilst still moving forward.

They are able to take advice from board members who have more experience than they do and have the ability to implement decisions that they don’t necessarily agree with for the overall good of the business.

However, others struggle to adapt to the roles and responsibilities of a CEO. They dislike the fact that they can’t make the decisions they want to, they battle with their boards over risk-taking, and miss the feeling of building something new rather than simply maintaining market position.

There are some who have the ability to flick a switch - going from one role to the other- multiple times as they grow and sell their businesses, before starting the process all over again.