The short answer is: a User is a team mate that has been added to your Pigeon Business workspace, and can oversee or review part of the account [depending on user level], but cannot interact with anyone. A Contact is an individual and/or group contact that a User has been assigned to, which allows the User to interact with internal team mates and external customers or affiliates as that Contact. You must add all team mates as Pigeon Users before you can create a Contact for them.
Let's go a bit deeper.
First, check your Business folder to review who else is part of your Pigeon Business workspace. In the User Management section of this folder, you'll see a tab for Activated. This shows everyone that already has an account. If you need to add other team mates, you can invite them using either of the buttons at the top right of this page. Check the status of your invitations under the Invited by email and Added manually tabs.
Once your team mate(s) accept(s) your invitation, they are part of your account and can be added to your Contacts and Business Directory. You must do this in order to engage with these Users in Pigeon.
When you invite your team mates to join your Pigeon Business workspace, there are two options: Invite by email or Add manually. If you Invite by email, you will need to wait for the person to accept your invite before you can add them to your Directory; if you Add manually, you can automatically create a Contact for them in the Directory, but keep in mind they will still need to accept your invitation to access the account.
When you're ready, go to the Contacts folder. Here you'll be able to create individual and/or group Contacts. Each User must be assigned to at least one contact in order to interact internally or externally. You can also assign the same User to multiple contacts.
See also: Invite Team Members, Build Your Directory, View Internal Directory Contacts, Edit Directory Structure