Entrepreneurs are classified by attitude to innovation (Danhof, 1949: innovative, imitative, Fabian and drone), by ownership (private, state, joint sector, cooperative), by size (micro and small, medium, large) and by motive or approach (solo self-employed, team builders, pattern multipliers, acquirers, social entrepreneurs and technopreneurs).
Not every entrepreneur is a Steve Jobs. Some invent new products, some copy proven ideas into new markets, some build steadily for decades and some resist change until the business dies. Economists have sorted entrepreneurs into types for more than 70 years, and the categories still turn up in exams and in real business analysis.
The best-known scheme comes from Clarence Danhof, who studied American farmers in 1949 and grouped them by how they respond to new methods. Other schemes classify by ownership, size, motive or the stage of the business. Here are the main types, grouped by the basis of classification. For the bigger picture, see types of entrepreneurship and characteristics of an entrepreneur.
A. By Attitude to Innovation (Danhof, 1949)
1. Innovative Entrepreneurs
They introduce new products, methods or markets. Joseph Schumpeter saw them as the engine of economic change. Kiran Mazumdar-Shaw, who founded Biocon in 1978 and built it into a biotech company, is an Indian example.
2. Imitative (Adoptive) Entrepreneurs
They copy innovations that have worked elsewhere and adapt them to their own market. In a developing country, this is often the most useful kind, because it spreads proven ideas quickly and with less risk.
3. Fabian Entrepreneurs
Very cautious. They adopt change only when not doing so would clearly hurt them. Many traditional family businesses fit this type.
4. Drone Entrepreneurs
They refuse to change even when it means falling profits. They keep doing things the old way until the market leaves them behind.
B. By Ownership
5. Private Entrepreneurs
Individuals or groups who start and own the business and take the risk themselves.
6. State (Public) Entrepreneurs
The government starts and runs the enterprise, as with ONGC, NTPC or Indian Railways.
7. Joint Sector Entrepreneurs
The government and private investors share ownership, as in many early state industrial development ventures.
8. Cooperative Entrepreneurs
Members pool resources and share benefits. Amul, owned by about 36 lakh dairy farmers through the Gujarat cooperative federation, is the leading example.
C. By Size of Enterprise
India defines enterprise size under the MSME Act by investment and turnover, which the 2025 Budget raised. The common types are:
9. Micro and Small Entrepreneurs
Run tiny or small units, often family-run, from a tailoring shop to a small engineering workshop. Millions of such firms are registered on the Udyam portal.
10. Medium Entrepreneurs
Run larger units with bigger investment, wider markets and professional staff.
11. Large-Scale Entrepreneurs
Build big industrial or service groups. Tata, Reliance and Infosys started small and grew into this category.
D. By Motive and Approach
12. Solo Self-Employed
Work alone or with very few people, often professionals or tradespeople, and trade growth for independence.
13. Team (Workforce) Builders
Grow by hiring and building teams to scale the business.
14. Pattern Multipliers
Replicate a working model across locations, such as franchisees opening several outlets of a chain.
15. Acquirers (Take-Over Entrepreneurs)
Grow by buying existing businesses rather than building from scratch.
16. Social Entrepreneurs
Run businesses whose main aim is solving a social problem. See types of social entrepreneurship.
17. Technopreneurs
Build businesses on new technology. See types of technopreneurship.
Summary Table
| Basis | Types |
|---|---|
| Innovation (Danhof) | Innovative, imitative, Fabian, drone |
| Ownership | Private, state, joint sector, cooperative |
| Size | Micro and small, medium, large |
| Motive and approach | Solo, team builder, pattern multiplier, acquirer, social, technopreneur |
