While innovation and entrepreneurship are undoubtedly intertwined, there are key differences between the two. To begin with, innovation is more commonly understood to be the process of creativity and invention that produces a new product, model, or service that improves an existing one, or provides a solution to a current challenge. Innovation manifests when individuals take advantage of economic changes, technological changes, new knowledge, new markets, etc. to develop a product that helps firms become stronger and more competitive in the market. There is no risk involved in the process of innovation.
The risk arises when that innovation is translated into entrepreneurship. Indeed, innovation is instrumental to entrepreneurship, but entrepreneurship is not always the result of innovation. Entrepreneurship is the implementation of that product, model, or service that resulted from the innovation process into a business opportunity. It involves adding tangible value to bring to market the innovative products or services. While innovation requires passion, curiosity, and creativity, the major skills necessary for entrepreneurship are intentionality, planning, management, decision-making, and risk-taking.