Ah, the lure of the lifestyle business! Working for yourself, when you want and where you want. No more office politics, mediocre (or bad) bosses, no more commute, spending more time with the family and kids, total control over your work and your personal life…
Sound too good to be true?
It’s not. There are many examples of successful lifestyle businesses – even ones that turn over 7 figures in revenue per year. The benefits are all there, but there’s also some truths that the hype doesn’t tell you that you need to be aware of.
Building a lifestyle business is just like any other business. It’s hard work, chances that it will succeed are perhaps just a little better than building a startup (you can get away with smaller revenue goals for a longer period of time) and you have to learn a heck of a lot about a lot of things you may know little about now.
But the lure is there, and the temptation to start your own business – to live life on your terms – is very attractive.
So how do you know if you’re ready to start a lifestyle business? Here are five key things you need to think about before taking the leap.
The difference between a startup and a lifestyle business
Many entrepreneurs think that a lifestyle business is not a real business. That somehow your ambitions are too small, you’re not playing a big game and even that you’re just in it for yourself.
Let’s dispel that myth once and for all.
A startup is a new business built with the idea of growing as fast as possible.
Founders of startups will often sacrifice their personal lives to build their business. Building the business, attracting investors and capturing thousand or millions of users or clients is the name of their game. An exit strategy is usually part of the business strategy.
Don’t get me wrong – I have nothing against startups (I’ve done a few myself) and I have the greatest admiration for the people who have the courage to risk everything on building a successful business.
But not everyone wants this kind of business – or this kind of life. Enter the lifestyle business.
A lifestyle business is one you build so you can live the lifestyle you want.
The goal of the lifestyle business is not growth above everything else. Your goal is to create a sustainable income so you can spend time on the things that matter to you – so you can have a better balance between work and life.
Lifestyle businesses are usually small – often just the founder, perhaps one or two employees or outsourced service providers. They’re not limited in revenue (there are many examples of non-employer businesses with 7-figure incomes). And they usually require fewer resources to build – you can even start a lifestyle business while you’re still working.
So with that definition out of the way, let’s look at five key things you need to consider before making the leap.
1. Entrepreneurship is not for everyone
The idea of being an entrepreneur is very attractive. You’re building something from the ground up, you’re your own boss and you’re in control of your own destiny.
But the life of an entrepreneur – as much as it is glorified – is not all sunshine and roses. It’s hard.
Entrepreneurs can be very lonely.
You’re starting out on your own and you’re going to be on your own for a long time. You’re responsible for everything, you have to make all the decisions and the buck stops – and starts – with you.
This kind of loneliness may not be for you. If you thrive on human contact and interaction, you may be better off in an environment where you are in regular contact with colleagues and friends. There’s absolutely nothing wrong with being an employee in a business – and it has a number of advantages the entrepreneur does not have in their own business.
Entrepreneurs give up a lot of corporate benefits.
You don’t have to jump out on your own immediately when you decide to build your lifestyle business – you can start building a lifestyle business while you’re working full time.
But the day that you do step out on your own, you will lose a lot of things you may have taken for granted before. Your regular income, medical benefits, the routine that comes from a regular job, the social life that comes with work life. Some of these may seem like small things (I will never miss Bill complaining about his noisy neighbour again), but you will miss some of them.
Entrepreneurs have to cope with a lot more stress.
There’s no one else to take the responsibility – you’re responsible for everything. Even if you’re getting rid of some stress by leaving the corporate life, you’re going to take on more stress – of a different kind.
Your income may not be as steady as you want it to be – that causes stress. You have to get a thousand things done – that adds more stress. And you won’t know, at least in the beginning, how to do a lot of stuff. That adds stress too.
These are not abnormal or insurmountable stresses – but you have to be aware that when you start out you will be replacing some of your work-related stresses with other stresses.
2. You will have to get good at stuff you don’t like
Think about this one carefully:
- Every business succeeds or dies based on their marketing and sales.
- Most people don’t know much about marketing.
- Most people don’t know how to sell, are afraid of it and dislike the idea of selling.
For your business to succeed you’re going to have to get good at both marketing and sales. Even if you don’t like it now, you will have to not only learn to get good at it – you will have to learn to like it otherwise you will never really get good at it.
Here’s the good news.
Marketing is a skill just like any other. You can learn to do it, or you can learn just enough to outsource it and know if they’re doing a good job. And it doesn’t have to be sleazy – you can market exactly the way you want (it’s your business, remember?). And once you learn more about it, the mystery will start disappearing and you will get to understand – and even enjoy – doing marketing.
Sales and selling fall into the same category. You may not know much about it now, but you can learn to do it. You don’t have to be pushy or get people to buy something they don’t really need – in fact you should be advising your customers to do the right thing for themselves or their business – not your own.
I like to think that I don’t sell. Selling is the problem-solving (consulting) I do before I get paid for it.
The point is this: you’re going to have to get good at stuff you may not like doing right now. Marketing and sales are not the only things people are afraid of – business finance is another area you will have to learn about – and get good enough at. But none of these areas require that you become a guru, and all of them can be learnt.
3. You will have to learn to listen to your customers
The biggest reasons startups – and lifestyle businesses – fail is because they build stuff people don’t want.
You may have a brilliant idea for a widget everyone should have. Or you’re frustrated with something – and you want to give people a better way to do it.
This is how many businesses start.
But what you think people need is not always what they want, and even if they want it they may not be willing to pay for it. So you’re going to have to learn to listen to your customers, and adapt your business to meet their needs.
I don’t know of any business (including this business I’m working on now) that ends up doing exactly what you set out to do. Every business pivots – goes through a fundamental change in their business model – as they learn what works and doesn’t work.
You’re going to have to learn to listen to your customers so you can give them what they need. And sometimes that means admitting you were wrong (or not quite right) and changing what you’re doing or how you’re doing it.
Are you willing to do that?
4. You’re going to need runway
In the startup world, runway is the amount of time you have to work on your new business before you have to stop and go and find a job to make ends meet.
No business is built in a week. Or a month. It takes time to build a business to the point where it provides steady income, and in the meantime you’re going to have to survive.
There’s good news here as well.
You can start a lifestyle business while you’re still working full time. It may take longer to build it, but you’re reducing your risk. If you have savings and you’re willing to take the risk, you can work on your business full time – it will go faster. But there are no guarantees and you need to know how much runway you have before you have to get income from somewhere else.
You may not want to hear the following – but you need to:
I usually advise my clients to budget for 6 to 12 months before their business starts generating any appreciable amount of income, and two years before they have a successful business. It can go faster – these are the examples of “overnight” successes popular in the press – but these businesses are usually not successes “overnight” and they are the exception.
If you have all the tools, some skills and you can work on it full time, you can go pretty fast. When you’re starting out, with limited knowledge, tools and skills, it’s going to take longer. But there are a lot of factors that play into how quickly you can become successful, and there’s no one rule that you can use to figure out how long it’s going to take.
5. You’re going to need passion
If you’re building something just to make a buck, chances are you’re not going to be very good at it, or you’re going to get bored pretty soon.
You have to have a passion for what you’re doing. Passion is what drives you to get out of bed every morning, work the extra hours if you already have another job and keep going even when the going is tough.
Without passion your business will always be a pet project – a hobby you’re playing at and never quite get off the ground. Without passion you will give up more easily, not do the stuff you’re not comfortable doing and lose momentum before your business is a success.
Passion is about higher purpose. I’m building this business because I believe everyone deserves to have a better life, that it should be easier to build a business and that you don’t have to give up your life to have a living. That passion drives me every day. Of course I want to make a living from this business – that’s why it is a business and not just a hobby. But my higher purpose is to help other people have a better life – and that drives me every day.
The promise of a lifestyle business is about living life on your terms. The dream is to work for yourself, when you want and where you want. You decide what you do, who you work with and how much time you spend working. In the end, a life you love lived on your terms.
But the road to get there is not easy, and you have to think seriously if it is the right road for you. The five key considerations in this article are not the only things that will help you build a lifestyle business, but they will give you a good indication of whether this is for you – and if you’re ready to build a lifestyle business.
- Entrepreneurship is not for everyone. The life of the successful (lifestyle) entrepreneur is very enticing, but the road to get there is hard. Make sure you understand that this is not an easy road to take.
- You will have to get good at stuff you may not like right now. You will have to learn about marketing, sales and business finance. You will have to get good enough at each of these (and other aspects of your business) to have a successful business – and give you the lifestyle you want.
- You will have to listen to your customers. As much as you believe your offering is what everyone should want or need, the market will tell you whether you are right – or not. Be prepared to pivot.
- You’re going to need runway. No business is built in a week – rather, think months or even years to get where you want to be.
- And finally, you’re going to need passion. Passion is the fuel that will help you get there. Without passion for what you do, your business will become a grid – and that’s the lifestyle you’re trying to avoid.
I hope that helps you make a better decision on whether a lifestyle business is right for you – and whether you’re ready to make the leap now.
What you can do now
One of the frustrations I had when starting my own business was that there was no framework that showed me all the things I had to do to build a successful business.
So I built one.
It’s called the Tornado Method, and you can download the free Beginner’s Guide to the Tornado Method from my website. If you download it, you will also get my weekly newsletter with news and articles about building a lifestyle business.
As always, your comments and questions are always welcome. Drop me a note.
And good luck – whether you’re thinking about building a lifestyle business or building one. It’s worth it.