What is a lifestyle business? Is it an insult or compliment?
What is a lifestyle business? It was suggested to me recently that I had a ‘lifestyle business’. It was intended as a compliment, but I’ve since been mulling over what that term really means. For me it has connotations that don’t sit well. And I’m not alone.
What is a lifestyle business? ‘Lifestyle business’ is a phrase that is applied to a lot of solo and micro businesses, so let’s look at what it means.
What is a lifestyle business?
There are many different takes on this, but paraphrasing Wikipedia:
“…a lifestyle business is run primarily with the aim of sustaining a particular level of income and no more … or to provide a foundation from which to enjoy a particular lifestyle.”
And this definition from John Warrillow, author of “Built to Sell:
“A lifestyle business is where the owner’s motivations go beyond a strict definition of return on investment … a business owner makes decisions that include more factors than just what will increase shareholder value…”
"If your business (or job) doesn’t empower you to live the life you want – or isn’t at least heading in that direction – then what’s the point of all the hard work?"
While the goal is to make a sustainable profit, a lifestyle business is also designed to deliver non-financial benefits such as flexibility, balance, lower risk, control, community benefits or lower stress. Money is the means to an end.
What is a non-lifestyle business?
With a purely commercial business or more traditional ‘start-up’, the core objective is to grow as large and as fast as possible, maximise revenue (or users) and then ultimately cash out through a sale.
Wealth creation for the founders and investors is the focus. Lifestyle benefits are not factored into the success equation.
So, what’s the problem?
While these definitions are pretty self-explanatory at face value, both have negative undertones.
Where money is made the king, then at its extreme we’re into the ruthless world of 80-hour weeks, decades climbing the corporate ladder or taking big risks and making huge sacrifices to build a global empire. While it the surest way to wealth, there’s a big price to pay in sacrificing many other areas of life.
On the other hand, the term ‘lifestyle business’ comes pre-loaded with its own patronising connotations.
In their cutting article The lifestyle business [email protected]#t, wildly successful tech business 37 Signals summed it up nicely.
“When the lifestyle card is pulled from its tired deck, it’s usually meant as a pat on the top of the head. An ‘oh, that’s such a pretty drawing, dear little boy’.”
To me it can imply that you’ve dropped out and taken the easy option, you’re not really serious about your business, you’re not creating anything of real value or you’re not sharp enough to make real money. Taken defensively, you’re an underachiever that can’t match it with the big boys.
More particularly I feel it’s the binary either/or positioning that is the problem. As 37 Signals explain:
“It’s the archetypical false dilemma: Either you (1) let your business devour your life and you’ll be incredibly successful or (2) you balance your life with other things than work but are relegated to paying-the-rent success.
I’m not saying that you can’t have success by pouring in all your waking hours. Of course you can. I’m saying that you don’t have to. That the correlation between the two is weak.”
What about a ‘life-giving’ business?
Does it have to be one or the other? Why can’t we go for gold and create a business that provides the freedom to live the life you want AND all the money you need to live it? A successful business, big or small, that gives you energy, freedom, lifestyle and control and allows you to pursue your passions and live in line with your values.
Striving for this sort of business is not an easy option, quite the opposite. It’s a serious endeavour that takes years of hard work and commitment to the cause. But isn’t that something worth betting your life on?
Choose your own adventure.
You may love the adrenalin-charged 24/7 lifestyle of a global tech startup, prefer the quieter existence of a freelance writer, or thrive on the challenge of an executive role. If your current work-life is ticking the right lifestyle box for you then you’re living the dream.
But, if you do find yourself in a big company that sucks your soul dry, a job that leaves you empty, or a small business that falls short of your big ambitions, you have a life-draining business.
The point is to make a conscious choice that matches your priorities around love AND money.
After all if your business (or job) doesn’t empower you to live the life you want – or isn’t at least heading in that direction – then what’s the point of all the hard work?
What is a lifestyle business? Does it describe what you do?
Is there a better term, or am I just overthinking it!?