I used to run a company that provided me with an easy, laid-back lifestyle of $500,000 per year in just 12 hours of work per week. It was a piece of cake.
But you know what they say about having your cake and eating it, too. I wanted something more. I wanted to change the world.
After a few false starts, I mapped out what my “ideal job” looked like. Living in San Diego, I thought being the CEO of a beach-themed company would be exciting. I could make cool products, have an active outdoor lifestyle, immerse myself in a beach environment, and travel to exotic destinations. When an opportunity to do all those things presented itself, I jumped on it.
It’s definitely a startup, but I insisted on a beach office so I could commute on my beach cruiser.
Our company is aggressively focused on disrupting the industry, yet I still refer to it as a “lifestyle business.”
So, what exactly are we?
It’s difficult to define, and a majority of new businesses fall somewhere between a startup and a lifestyle business. But finding where you fit on this spectrum is essential to successfully establishing your business. Before you decide whether you’re a lifestyle or a startup entrepreneur, you have to understand the difference between the two and why it matters.
Lifestyle Businesses vs. Startups
Starting a business is ultimately about personal fulfillment. Entrepreneurs who start lifestyle businesses do so because they want to make their lives more appealing. This could mean a more flexible work schedule, a fun work environment, earning more money, or achieving life goals.
Startups, on the other hand, are built by entrepreneurs who have a desire to find meaning in their lives and make contributions to the world. They arise out of an entrepreneur’s desire to improve an existing system. Though there may be lifestyle benefits that come from building a startup, these entrepreneurs are primarily interested in making an impact.
The more closely your business aligns with the startup ideal, the more sacrifice will be involved. Strategically, startups have a disruptive objective; you can’t change the world by following a crowd. Startups require succeeding in a completely different way from everyone else in the market. The risks are higher, as are the chances of failure.
With a lifestyle business, success and comfort are more important than having an effect on an industry, and the risks are lower. You can make safer bets by following the crowd and then outperforming them. The purpose is simply to enjoy what you’re doing.
Why Define Your Business?
Whichever type of company you decide on, it’s important to clearly define why you’re interested in starting a business in the first place so you’ll be able to jump on an appropriate opportunity as soon as it presents itself. Knowing why you’re in business will also give you the confidence and motivation you need to make it successful.
Determining your motivation behind starting a business can be difficult when you’re excited about a new idea. To maintain a sense of clarity, ask yourself the following questions to see whether you’re closer to being a lifestyle or startup entrepreneur:
- Which is more important to you: a better lifestyle or a sense of purpose? How significant is your preference for one over the other?
- Are you willing to lose everything? What will you do if your business fails? Can you start over again, both mentally and financially?
- Are you willing to make sacrifices for the next three to five years to accomplish your goals, or do you demand immediate success?
- What does success look like to you, and how do you see yourself getting there?
Answering these questions and establishing purpose removes any illusions (or delusions) about owning a business. People who see freedom and money at the end of the road must understand that it’s often a long, difficult process, and success will likely come only after failure, disappointment, and sacrifice.
Carefully consider your answers to these questions, as neither option is easy. There’s no shortcut to creating your own business, and there are different paths you can take, depending on your motivations.
If you define your purpose and are willing to work through the inherent challenges of business ownership, you can have your cake and eat it, too. I’m living proof. I maintain my business because I still want to change the world — I just happen to have a great time doing it.
Guest author Stephan Aarstol is the CEO and founder of Tower Paddle Boards, an online, manufacturer-direct brand in stand up paddle boarding. Tower Paddle Boards was invested in by Mark Cuban on ABC’s “Shark Tank,” was named one of the show's “Top 10 Success Stories” by Entrepreneur Magazine, and was featured by People Magazine as one of “Shark Tank’s Biggest Winners.” Stephan is an entrepreneurial thought leader and online marketing expert, and he welcomes anyone to reach out to him on Google+.