Entrepreneurs: Why We Need Them

One of the many ways in which the free market makes the world a better place, is because of a type of person who can really only exist within a free market economy – the entrepreneur.

What is so special about this particular kind of person? There are many qualities required to be an entrepreneur – intelligence, tenacity, a hearty work ethic – but there is one quality that sets the entrepreneur apart, and that is the willingness to assume some level of risk.

When entrepreneurs start their businesses, they’re taking a gamble. Some of them crash and burn. Some of them make it big. Some of them fall somewhere in the middle. It can be scary, and to some, it may even seem foolish to take that kind of risk.

But here’s the thing – we need entrepreneurs. We need people who are willing to take the leap, to stick out their own necks in order to create new things. Without them, innovation and human advancement would slow, and with it, lives would fail to be improved. The impact of this would be varied – some entrepreneurs make a huge impact on the wellbeing of humanity by making advancements in medicine, transportation, or even commerce. Still, others impact their communities by providing valuable services, and some improve lives simply by making people happy – like those who assume the risk of opening a restaurant in the hopes that people will enjoy the food they serve and keep coming back.

An entrepreneur’s success depends on their ability to make the consumer’s life better in some way. In that way, it’s clear that we all benefit from entrepreneurship. But there’s another reason we need entrepreneurs – employment.

Think about it; we can’t all be entrepreneurs. Some people are just more risk averse, some have life circumstances preventing them from taking risks, or maybe they simply work better under an employer, or prefer that lifestyle over that of a business owner. Any society needs both types of people in order to advance. Entrepreneurs need 1) people to consume their products/services, and 2) people to work with them and help them spread and advance. Non-entrepreneurs need entrepreneurs to start businesses that will employ them, and businesses whose products/services will serve them. Neither thrives without the other, and each benefits from the other’s talents and input.

Take, for example, a woman who starts her own skincare company. She first has to take the risk of purchasing materials, and sacrificing her time and energy. Let’s assume that she develops, sources, packages, markets, and ships everything by herself while she’s starting out. In this way she benefits her customers, who enjoy using her products and experience improvements in their skin health (assuming she has a good product!) but now that people are purchasing and benefiting from her products, she needs to hire some employees to help her out. This benefits whoever she hires, because now they have a source of income! Maybe by hiring her employees, her business experiences growth, so she hires more workers.  More people benefit. Her risk is paying off for her, yes, and it also benefits others around her.

Certainly, it doesn’t always work like that. Maybe the business owner doesn’t pay her lead researcher enough, despite all the growth this person’s work has facilitated for her company. But therein lies the beauty of the free market – the researcher is free to leave the company! Maybe she gets a better offer from another skincare company who is willing to pay a higher wage. Maybe she leaves and starts her own business doing freelance research, and goes on to hire employees herself.

All of this is only possible in a free market system, where people are free to leave or take jobs, and start businesses as they please. It takes time, energy, and the risk of failure. But only under a free economy are people able to make their own risk calculations, and take their shot at an opportunity to improve their own lives and the lives of others.

If you live in a free market society, take a look around you and notice; how much of your day is affected by an entrepreneur? You might be surprised how much you benefit from entrepreneurship, even in small things like your skincare routine.