I'd have the opposite take on the title "lifestyle business". The opposite is really the "get rich or die trying" business. The opposite are the businesses that can only survive as long as they keep coming out with some new novelty until they're bought without necessarily creating a sound business.
Lifestyle business means that you have your priorities right. The purpose of business and money is making life easier and nicer. Life's purpose isn't business and money. The problem is that we put people like Mark Cuban on a pedestal for creating something that couldn't make money and didn't create much value simply because someone else was stupid enough to pay billions for it in a frenzy. At the same time, we don't have a lot of respect for people like the restaurant owner who does a consistent good job because what he does can never have the "infini-scale" of large web projects and get bought for billions.
Of course, as we've seen, the "infini-scale" almost never happens. Really, what company that was purchased in all the .com land rushes has made the owner much money? Not broadcast.com, not YouTube, not Geocities, not AOL, not FeedBurner, not Jaiku, not Dodgeball. . . But all of them were acquired for tons of money. They played "get rich or die trying" and got rich while making nothing that lasts up to that measure.
Lifestyle businesses aren't about who works harder. It's about creating known value rather than the latest fad. It's about giving customers something good at a fair price rather than trying to corner the market, exercise the synergies, actualize the growth potential, or whatever other marketing speak one would use to get a large, scared player to buy you when you have no profit potential. Lifestyle businesses are about humbly giving people something good and knowing that you're making a positive impact on their lives. Maybe you aren't "game changing", but people appreciate a good business.
I like the point of that "Miles" made in the comments: that there really is such a thing as a lifestyle business, but there needs to be a new term for businesses too small to interest VCs.
A "lifestyle business" is something that makes you enough money to get by, perhaps somewhat passively.
But no one should call 37signals a "lifestyle business" -- they are a small company with millions of dollars in revenue. But VCs probably would not have been interested in them because they didn't plan to take over the world.
Just wondering...what are the options for funding a business that isn't VC sized but could be successful in its niche? Bootstrapping? SBA loans?
I've been working the SBA loan route for a while now, and I'm preparing to post a summary of my experiences to HN. If anyone out there has also tried to get SBA-backed loans for a startup, holler and maybe we'll co-write some tips for other entrepreneurs.
I love the term "Lifestyle Entrepreneur" and I wear it with pride. There was a time when I thought it was all about raising investment money. Then I realized that such a prospect was completely outside of reality, and furthermore, I didn't need the money. Then I just hunkered down and got to work.
Feel free to rename it if you want, but I'll stick with the original.
i agree. i don't find the term lifestyle business demeaning.
i've had some lifestyle businesses in the past that have done really well, and frankly, when you have a really successful lifestyle business, if someone treats you condescendingly, sitting at the beach drinking pina coladas at 11am on a weekday is a great remedy.
There's nothing inherently 'demeaning' about the term 'lifestyle business' -- except that in the context of people who are seeking something more, it implies something less.
Picking a new name will shift the implication. See "euphemism treadmill":
Whatever new term is picked, no matter how initially flattering, will -- when repeatedly used in the same contexts -- eventually adopt the same connotations of 'not good enough for bigtime purposes'.
I agree partially. So long as the word means 'that thing VCs won't invest in,' it's demeaning.
But lifestyle business is inherently demeaning. It implies a goal of cutting back on stress, hard work, long hours etc. A retirement business. A B&B.
Since most of those it is applied to (in this context) do not have these goals, it is insulting. Like calling a punk rocker adorable.
The thing is that it's not what VC's won't invest in that needs a name, it's what they do invest in that needs one. For one thing, an exit plan is something the majority of businesses do not have when they start.
I like the name "business" :-) But, I do think joshk is right that "lifestyle business" is a bit of a demeaning term nowadays. My submissions are "pasta profitable" and "leanstrapped"; latter seems to hit a nerve with people. Feel free to vote em up or down.
Lifestyle business means that you have your priorities right. The purpose of business and money is making life easier and nicer. Life's purpose isn't business and money. The problem is that we put people like Mark Cuban on a pedestal for creating something that couldn't make money and didn't create much value simply because someone else was stupid enough to pay billions for it in a frenzy. At the same time, we don't have a lot of respect for people like the restaurant owner who does a consistent good job because what he does can never have the "infini-scale" of large web projects and get bought for billions.
Of course, as we've seen, the "infini-scale" almost never happens. Really, what company that was purchased in all the .com land rushes has made the owner much money? Not broadcast.com, not YouTube, not Geocities, not AOL, not FeedBurner, not Jaiku, not Dodgeball. . . But all of them were acquired for tons of money. They played "get rich or die trying" and got rich while making nothing that lasts up to that measure.
Lifestyle businesses aren't about who works harder. It's about creating known value rather than the latest fad. It's about giving customers something good at a fair price rather than trying to corner the market, exercise the synergies, actualize the growth potential, or whatever other marketing speak one would use to get a large, scared player to buy you when you have no profit potential. Lifestyle businesses are about humbly giving people something good and knowing that you're making a positive impact on their lives. Maybe you aren't "game changing", but people appreciate a good business.