HomeInvestmentsIs There Really a Difference Between Opportunity vs Necessity Entrepreneur

Is There Really a Difference Between Opportunity vs Necessity Entrepreneur

I had never heard of the terms Necessity and Opportunity Entrepreneur until a recent CNBC article titled, “US Entrepreneurship Reaches a 14 Year High” by Heesun Wee.  Mr Wee interpreting a Babson Report states,

During the depths of the recession following the 2008 financial crisis, Americans who were frustrated with not being able to find work took the bold step of opening their own small businesses. It was a bittersweet accomplishment for many new moms and pops, who became known as necessity entrepreneurs.

Now five years later as the recovery gains traction, new data shows the tables have turned. Instead of necessity-driven new businesses, more U.S. entrepreneurs are launching ventures based on perceived opportunities, growth ambitions and a broad optimistic outlook—a group sometimes called opportunity entrepreneurs.

The question I have is does the distinction really matter?

Whose Necessity Breeds Innovation?

There is that old saying that necessity breeds innovation but whose need is that? Is it the person who has been hammered by the economy? Maybe in rare cases but certainly not the majority.  Registering a domain does not make an entrepreneur or long term business owner.   That is not to take away from those business owners that started something because of a downturn in the ecnomy the whole topic just makes me wonder how many of these businesses last.  Then the next logical question becomes even if the business is stable how many close up shop when the economy turns and a traditional job is more likely to be had?

I could absolutely be wrong, but at first introduction to the topic via CNBC, it just seems to me that the market’s necessity and not the creator’s necessity is what drives a successful business.



  1. It may not matter as long as you have passion for the business. Necessity or opportunity may provide a reason for a small business, but you still need passion for it. I guess time will tell.

  2. I don’t think the distinction really matters. Sometimes we do what’s necessary in order to make money in this economy.

  3. Many MLMs have pitched the need for people to be an entrepreneur to avoid getting crushed in downturns in 2008.

    Of course these aren’t people truly starting businesses, but being glorified commissioned salesmen.

    Anyway, I can see the distinction because the MLMs purposely go after those who need income and are not going after those who see an opportunity to create a business.


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