Intrapreneurship vs. Entrepreneurship: What's the Difference?

Look up “intrapreneur,” and Google will ask if you meant to search for “entrepreneur.” But this position is slowly becoming more well-known as companies around the world use it to drive internal innovation and keep up with their startup counterparts.

In this article, we’ll explore:

• Intrapreneurship Definition
• Responsibilities of an Intrapreneur
• Benefits of Intrapreneurship
• Entrepreneurship vs. Intrapreneurship
• Examples of Intrapreneurship

What is an intrapreneur?

An intrapreneur works at a large company but acts like the leader of a startup. They typically manage a small team and/or have complete ownership over a product or initiative that's separate from their organization's core business.

An intrapreneur works to create new business opportunities or products at their company and find paths for innovation. The main goal of an intrapreneur is to drive innovation within their company.

Some responsibilities of an intrapreneur are:

• Identifying new business opportunities
• Refining ideas and generating new ones
• Getting buy-in from stakeholders
• Leading and executing new initiatives

The Benefits of Intrapreneurship

To many, being an intrapreneur holds a lot of appeal. Intrapreneurs get much of the rewards of entrepreneurs — visibility, money, power, learning opportunities, connections, and maybe most importantly, the chance to create something new — without much of the risk — bankruptcy, major failure, etc.

A successful intrapreneur is hugely valuable to their employer, which means they receive high salaries, tons of benefits and perks, and leverage.

Drawbacks of Intrapreneurship

While the benefits of entrepreneurship are enticing, there are drawbacks to consider.

• Risk of failure: While not as great a risk as being an entrepreneur, intrapreneurship also comes with its own set of risks. Not every project will be a home run, and as such, you should be prepared for some initiatives to fail and pivot your efforts accordingly. It can also be high pressure because failing means failing the company — not just yourself. 
• Limited spoils of success: While entrepreneurs reap all the financial benefits of their innovations and new initiatives, for intrapreneurs all of those benefits go to the company they work for. That’s not to say being an intrapreneur isn’t lucrative, it just means that your efforts will ultimately benefit the company you work for rather than just yourself.
• Conflicts with resource allocation: Intrapreneurship requires an investment of money, time, and resources. This often means diverting resources from other areas of the business that may pose some friction within the organization.
• Having to work within a rigid structure: When you’re an entrepreneur, you have the freedom to operate as you wish. That’s not the case with intrapreneurship. Since you’re working within an existing company structure, you’ll need to adhere to their rules and guidelines.
• Lack of support: In order to be successful, you’ll need to get buy-in from company stakeholders. These stakeholders may or may not be enthusiastic about new initiatives and offer less support or resources.
• Resistance to change: Since you’re working within an established structure, it can be difficult to get the company on board with any changes you’d like to make. They’ve been used to operating a certain way and may be resistant to switching things up.

Entrepreneur vs. Intrapreneur

An entrepreneur runs their own company. They have complete freedom and responsibility — for better or for worse. An intrapreneur is responsible for innovating within an existing organization (usually a big one). While intrapreneurship is less risky, it also comes with less autonomy. The payoff from a successful product or idea is also usually smaller.

While the roles of both entrepreneurs and intrapreneurs share some common traits, there are substantial differences between the two.

As an intrapreneur, all of your new initiatives and projects will need to work within an existing organization or company. The roles differ across:

• Resources: Intrapreneurs are dependent on the company’s resources. Entrepreneurs secure their own.
• Risk: Entrepreneurs assume all the risk while with intrapreneurs, the company takes on the risk.
• Autonomy: Entrepreneurs have complete control over their projects, while intrapreneurs have to work within an existing organization and garner approval from stakeholders.
• Ownership: Entrepreneurs have full ownership while intrapreneurs have none.

Questions to ask yourself before deciding to become an intrapreneur:

• Would I rather have the resources and support of a large company or the freedom of running my own?
• How important is job security to me?
• How tolerant of risk am I?
• Do the responsibilities of managing my own business scare or excite me?
• Can I navigate an existing culture, or would I prefer to create my own?

If you’ve decided entrepreneurship is more your speed, check out these small business ideas to help you get started. Not sure what intrapreneurship looks like in action? We've rounded up a few examples below.

Intrapreneurship Examples

1. McDonald's

Many of us have memories of enjoying Happy Meals as a child — the popular kid-friendly meal combo that comes with a toy. What you may not know is that Happy Meals were created by two intrapreneurs in the 1970s. The Happy Meal was the brainchild of McDonald’s ad manager Dick Brams and executed by Bob Bernstein, a marketing executive whose agency had been running marketing for the company for a decade.

The concept was meant to position McDonald's as family-friendly — enticing return business — but corporate wasn’t completely on board at first. After more than a year of successful tests, the Happy Meal launched nationally in 1979.

2. Google

Google's email tool, Gmail, was developed as a result of intrapreneurship. Paul Buchheit, the creator of Gmail, worked independently to build the first version of the tool.

3. Apple

Are you familiar with Apple's Macintosh computer, also known as the Mac? It's just one example of a product that was created via intrapreneurship. Steve Jobs organized a group of intrapreneurs to work independently to develop the computer.

4. Facebook

Facebook hosted hackathons that allowed employees to work on projects they were passionate about. A prototype for the “Like” button was developed as a result of these hackathons.

Intrapreneurs Help Companies Thrive

Intrapreneurs are creative and take risks to help companies continue to innovate and compete with startups. While maybe not as glamorous as an entrepreneur, they are integral to company growth.

Editor’s note: This article was originally published in May 2019 and has been updated for comprehensiveness.