A few weeks ago we had a meeting with a lovely gentleman from Astia, a terrific organization that helps women entrepreneurs gain access to capital. During our conversation he made the distinction between high-growth businesses and "lifestyle" businesses. I visibly winced and sharply responded that I really hated that term. When he asked why I told him that I understood his point, high-growth businesses are very different from regular small businesses, but I didn't agree with the language.
But before I get to why, let's acknowledge the very real distinction between regular small business and high-growth businesses that he was referring to. High-growth businesses are intended to be highly scalable and fast growing. They are fueled by rounds of outside equity investment and the founders are required to have an exit plan in place -- a point in time where the company will change hands and where they will (likely) step aside. Their mandate is to create the biggest opportunity possible. This strategy creates a particular set of challenges and business practices unique to this kind of business. By contrast regular small businesses seek a variety of outcomes (intellectual challenge, creative freedom, creating a specific market or industry change) in addition, of course, to business growth. That growth might be more modest or sustainable or it might not. What's different for them is the absence of the "as big as possible" mandate.
So if the distinction is real, then what's wrong with the term "lifestyle" business? Plenty.
1. The way we think about business has become overly simplified. It's just not accurate to group all businesses that are not high-growth together and label them "lifestyle" businesses. Like our two-party political system, only having two buckets in which to put businesses is limiting and restrictive. These so-called lifestyle businesses far outnumber those that are high-growth ventures. Does the term "lifestyle" really apply across the board? Is a restaurant a lifestyle business? A dry cleaner? A retail store? Given that these non high-growth businesses are the majority but are also diverse in their own right, why not just call them "businesses" or "small businesses"?
2. Forgetting for a moment that the term lifestyle business is disproportionately applied to women, the problem isn't so much the word but the stereotype it evokes -- a less than serious entrepreneur who attends to their optional business as they have time for it. This connotation greatly discredits the vast majority of entrepreneurs. Despite the fact that most entrepreneurs hope to use their new found freedom to craft a more congruent work life fit, the truth is that most work harder and longer than they ever did for someone else. To suggest that their businesses are all about, or even primarily about, their outside-of-work lifestyle undermines the difficult choices, grueling schedules, and significant risks that these entrepreneurs experience. More importantly, it undermines the ground-breaking, industry-changing, job-creating, and money-making nature of their work.
3. Exactly what is so easy about creating, sustaining and integrating work that is challenging, rewarding, and profitable with a life that is meaningful and engaged? It's an amazing ideal to shoot for, and one that's well-worth the fight it requires, but it's far from simple. Don't forget that the boom in so-called "lifestyle" businesses hasn't been because people wanted things to be easier. Instead the numbers are a result of people being told that they couldn't have it all. Corporations have made too many people (mostly women) choose between their work and their lives, demonstrating their belief that challenging work can't accompany a full life. Disturbed by the lack of creativity and a life built predicated on extreme sacrifice, workers left to achieve this supposedly impossible feat on their own. I don't know of any entrepreneurs who say it's easy, but almost every single one says it's worth it. We shouldn't dismiss them as being anything less than up for a very difficult challenge.
So let's lose (or at least limit) the overuse of term "lifestyle" business and prove that entrepreneurship is bigger, broader and more expansive than the 'high-growth or bust' mentality.