Innovators are the pioneers in developing new ‘entities’. Studies describe them as more open to new ideas, concepts, and ways of thinking, more imaginative, more reflective, more free-spirited and more non-traditional than the everyday person. Not all innovators are entrepreneurs, and not all entrepreneurs are innovators; however, the more innovative the business, the better its odds of succeeding. Innovators develop new technologies ‘out of thin air’, like Thomas Edison, one of those who developed the light bulb, Edwin Belin, who held the patent in 1922 for the transmission of photographs by wire as well as fiber optics and radar, and demonstrated a mechanical scanning device that was an early precursor to today’s television set, or Steve Jobs, the CEO and entrepreneur who built up Apple and was reported to be ‘as famous as a 1970s rock star’ in the newspapers at the time; new concepts, like Gabrielle ‘Coco’ Chanel (1883–1971), who is the most influential and innovative fashion designer to date, or Miles Davis, who legitimized a new genre, ‘fusion jazz’, when the jazz model was a radical innovation; new marketing and selling concepts, like Philip Kotler and Gerald Zaltman, who ‘sold’ ideas, attitudes and behaviors through the innovative ‘social marketing’ (Kotler and Roberto 1989); new adventures, like Neil Armstrong, Buzz Aldrin and Michael Collins, the pioneering crew that put two astronauts on the moon. The literature in innovation and creativity distinguishes innovators from adaptors (e.g. Isaksen and Kaufmann 1990; Nias 1998). However, innovators may also find innovative ways to improve applications of either new or existing technologies or processes; they may apply existing technologies and/or processes in new ways, or amend existing technologies via innovative business models. 

The Schumpeterian conceptualization of entrepreneurship focuses on the innovator, i.e., the one who disturbs the even flow of production by breaking away from routine activity and by creating new ways of doing things and new things to do. Schumpeter (1912, 1934) argued that innovation and technological change in the market spring from the wild spirit of entrepreneurs. Schumpeter, who was a very influential scholar in the field of entrepreneurship, promoted the use of the term, which is based on the translation of the German word Unternehmergeist, meaning entrepreneurial spirit. In his many publications, he emphasized the imperative role of innovation, which he considered a major component of each and every stage of venture creation. Identifying innovation as an inseparable element in the whole process of entrepreneurship was Schumpeter’s main contribution to the theoretical foundation of this field (McCraw 2007). Peter Drucker (1985a, 1985b) also considered innovation to be the backbone of entrepreneurship, and claimed that entrepreneurial businesses become successful only by being innovative. He further suggested that entrepreneurs, who are by nature innovative, are uniquely inspired individuals who are able to grasp possibilities from the mundane and turn them into a different reality. The research in innovation and entrepreneurship revealed five key elements that have been used to characterize and illustrate the entrepreneurial spirit; and innovation is considered as having a predominant role, especially in the basics of entrepreneurial businesses; along with the other four dimensions (i.e., autonomy, risk-taking, proactiveness and competitive aggressiveness), innovation is treated as the foremost element elevating the performance of entrepreneurial

businesses and contributing to their success and profitability. Other types of businesses, less innovative in ‘spirit’ (e.g., imitative or acquisitive types of businesses) have been found to be less successful in the entrepreneurial realm (Miller 1987; Covin and Covin 1990; Covin and Selvin 1991; Kariv 2010). However, innovation does not emerge only as a positive outcome for the business: many entrepreneurial businesses that are in a stage of scarce resources yet are striving for innovation and invention have to cope with the difficult trade-off between exploitation of existing technologies, capabilities and markets with the exploration of innovative technologies or capabilities. Christensen (2000) identified this as the ‘innovator’s dilemma’, but the potential damage innovators can ‘cause’ is mainly to the businesses that engage in such innovations. For example, by engaging in new technologies, entrepreneurial businesses can end up losing customers who are not yet ready for such innovation; using different marketing innovations may result in the loss of current customers for newcomers. Entrepreneurial businesses, however, cannot renounce innovators in their businesses since they are the ones who can produce the added-value, sustainable advantage for the business. The question lies in whether to invest in potential capabilities that may support long-run sustainability or harvest short-term benefits from current capabilities, as well as in how to trade-off the costs of exploration (investments in survival) with the benefits of exploitation (maximizing returns to investors). Such a dilemma may be dealt with in several ways: first, the ‘mindset’ of entrepreneurial businesses is typically highly tolerant of ambiguity and high risk-takers. As such, entrepreneurial businesses will take risks; in addition, businesses should be attentive to the ‘hints’ of up-and-coming trends from their environments, which can then be developed into innovative products, services, technology, etc. Finally, entrepreneurial businesses explicitly eschew prediction and choose instead to create the future; they then ‘sell’ new concepts, ideas, and mindsets, rather than a product/ service, through today’s emerging and expanding networks and the imaginative leveraging of unexpected contingencies into unforeseen opportunities.

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