The Lifestyle Business
Lifestyle businesses are business created for lifestyle and personal reasons instead of focusing on financial gain. The main difference between an equity or high growth business and the lifestyle business is the focus is not on profit but sustaining the owners particular lifestyle. In many cases there are no other shareholders, leaving the owners to have more control in the operations of the business.
When most people hear the phrase “lifestyle business” they usually think of small part time endeavors or mom and pop shops. While this can be true, some larger businesses were created with the intentions of not selling to investors or going public, but as a foundation for the goals of the owners.
There can be a fine line between lifestyle businesses and self employment. A good way to tell is if you have created a business and have to open up everyday and close every night, you have essentially created a job.
Qualities of a Lifestyle Business
- Built to operate for many years.
- Generates a good income for those involved.
- Allows founders to pursue passions & interests.
- No intentions to sell or exit.
Examples of Lifestyle Businesses
- Writer/Professional Blogger
- Consultant
- Bed and Breakfast
- Ecommerce Store
Advantages of Starting Lifestyle Business
The advantages to starting a lifestyle business include being able to control most aspects of the business, having a positive cash flow from early in the business’ growth, and being able to pursue personal goals with profits from the business. Most advantages revolve around a common theme, freedom.
Time Freedom
Time Freedom is having the freedom to choose when to work or when not to work, without having to call in sick *cough*.
Financial Freedom
Financial Freedom is having an income level sufficient enough to support a desired lifestyle. Being able to pick up and go if you want.
Location Freedom
Location Freedom is having ability of being able to choose where to work. Mobile business is gaining momentum with internet technologies and global communication.
Disadvantages of Starting Lifestyle Business
- Limited funding sources.
- Difficulty recruiting top talent.
- Lower chances for large gains.
The Lifestyle Entrepreneur
The Lifestyle Entrepreneur is not focused completely on financial gains from starting a business, but on creating a foundation to support their lifestyle and goals. The lifestyle entrepreneur desires work centered around their passions and personality. They thrive on independence and creativity, and often don’t view what they do as “work”.
If your passion is traveling to exotic locations, you might open up a travel agency with trips or excursions organized around your destinations that you love to visit. You are reaching your personal goals though an income generating business.
Differences between an Entrepreneur and a Lifestyle Entrepreneur
One of the main differences between a lifestyle entrepreneur from an entrepreneur is a focus on the passion, and running a business not for the financial gain of investors, stock holders and themselves but for fulfilling their personal goals.
The term “Lifestyle Entrepreneur” was coined in 1987 by William Wetzel, a director emeritus of the Center for Venture Research at the University of New Hampshire.
Qualities of a Lifestyle Entrepreneur
- Desires Freedom & Independence
- Values happiness
- Independent thinker
Define your Goals
Whether your goals to get out of debt or change the world, you must write them down. They can change as you go, so don’t put too much emphasis on finding perfect goals. When you create the new venture make sure the business aligns with your goals and passions.
When deciding what type of business venture you would like to pursue, or how to restructure a existing business. Ask yourself some important questions:
- How much time freedom would you like?
- What kind of income level could support your desired lifestyle?
- What hobbies or interests fascinate you?
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