I accidentally stumbled over the term Lifestyle Business about a year ago.
I listened to a podcast by Chris Dunn where he talked to Lewis Howes about building Lifestyle Businesses and becoming a Lifestyle Entrepreneur.
Back then, I never heard of Lifestyle Businesses before and somehow found the concept quite intriguing.
It sounded like it had the fun factor of Startups but paired with more flexibility.
It is believed that the term Lifestyle Entrepreneur was coined by Lewis Howes but does it actually matter?
All that matters is the core idea and whether it is something that can help you to fulfill your dreams.
The “Official” Definition of a Lifestyle Business
A Lifestyle Business is a business that was set up with the focus to generate and sustain a certain level of passive income that allows its founders to enjoy a particular lifestyle.
Let’s pause here for a second and think about what it actually means:
“…generate … passive income…”
Although passive income is not 100% passive, the basic understanding is that your business should be able to run independently. You should not exchange time for money 1:1.
“…sustain a certain level of passive income…”
Your business should be a stable source of income with little fluctuation. If your business depend upon too many outside factors such as season, weather, geolocation or current trends, it will be hard to sustain it longterm.
“…enjoy a particular lifestyle.”
Your business should enable you to do the things you love. Whether it’s traveling, eating out a lot or just spend more time with family.
The main idea of a Lifestyle Business is that you plan your business around your lifestyle, hence the name.
Lifestyle Entrepreneurs are not focussing on getting rich or to expand rapidly and going IPO with their companies (-> Startups).
Experiences come first, business second. You need to define first how your life should look like and then think about how you can build the business around it that generates enough income to cover your expenses.
Characteristics of a Lifestyle Business
Because a Lifestyle Business should provide you the freedom to pursue your dreams it inevitably dismisses business types by default that requires you to exchange time for money.
Also business types that tie you to a location, such as retail stores or restaurants do not go under the umbrella of a lifestyle business.
Of course you can hire people to run your business, but what do you think your employees will think of you if you travel the world all the time while they are working their butts off to finance your trips?
For that reason, I believe the core characteristics of a Lifestyle Business are:
#1 – Your personal freedom is key
#2 – Time is not exchanged for money
#3 – A scaleable business model that allows you to reach more customers
#4 – A Location independent business so you can work from anywhere, anytime
#5 – Passive income exceeds at least your frequent living expenses
Show me examples of a Lifestyle Business
Now you know what a Lifestyle Business is and you may wonder how such a business could look like?
What type of business could you build in order to achieve more freedom?
Create Information Products
Chris Guillebeau is one of the many entrepreneurs who can make a living by teaching others about what he is passionate about: Traveling.
With 35 years he travelled to every country on this planet. Over the years he gained a lot of experience in terms of how to get the ticket for the lowest price, how to collect thousands of miles without flying and so on. He created information products and shared his knowledge with other travel addicted people.
The author of the 100$ startup didn’t stop there and he keeps creating more and more information products. His latest project is the Side Hustle School were he helps people to create another income stream on the side.
Create a Dropshipping Store
Johnny FD is probably one of the biggest ambassadors for Dropshipping, a business concept where you create an online store and function as a middle man between customers and wholesalers. Every time you get an order in, you forward it to your supplier and he ships it directly to your customer. This is a big advantage because Dropshipping doesn’t require a lot of upfront investment in terms of keeping inventory.
Dropshipping is a flexible business concept that allows you to work from any where in the world with high speed internet connection and doesn’t require you to work around the clock.
Create a Travel Community
Conni is an amazing woman who created one of the biggest german travel blogs. She started traveling when she was 15 and is ever since living a nomadic lifestyle. With her blog she helps people traveling around the world by sharing tips and resources. Furthermore she created an eBook and online course to help people achieving the same lifestyle that she has. Currently she is traveling around the world while earning money passively from her digital products.
And there are soooo many more interesting business concepts that allow you to become more flexible and achieve personal freedom. The only question is, whether a Lifestyle Business is something for you and how you can apply your skills to build one.
Should you build a Lifestyle Business?
Everyone has different preferences and not everyone wants to travel the world. Some people may want to spent the time with beloved ones. Others may want to use the time to pursue personal projects they always wanted to do.
There are unlimited reasons why people pursue freedom.
Personally I think a Lifestyle Business can enable you to really live your life to the fullest because it allows you to plan it the way you want.
Of course building a business requires some kind of will power and perseverance but I believe it is totally worth it because you don’t need to wait until you retire to enjoy life.
People who usually tend to become Lifestyle Entrepreneurs are:
- stay at home moms who want to use their free time to make a money on the side
- people who suddenly lose their jobs and have to make a living
- free spirits who can’t stand to work for other people
- employees who are sick of their 9-5 routine and want to escape their cubicles
Whether or not you should create a Lifestyle Business totally depends on your personality. Not everyone should be or is meant to be an entrepreneur. Yet, you probably wouldn’t be reading this if you are not somehow a little bit interested in entrepreneurship 😉
If you are interested to find out what your personality traits are and if you have a little entrepreneur in you, here is a nicely designed test you can take: 16 Personalities.
In a previous article I explained why you should give entrepreneurship at least a consideration: 5 Reasons Designers Should Become Entrepreneurs and Mind Their Own Business
How does the concept sound to you? Did you find yourself in the list above?
There are also some interesting articles I can recommend if this article just arouse your interest and you want to know more about the concept:
The rise of Lifestyle Entrepreneurs
Why you should become a lifestyle entrepreneur
Startup vs. Lifestyle Business
Furthermore, if you are interested in knowing more about different business concepts, here is an article I published before that might also be interesting for you to help making an educated decision:
“The 4 different levels of entrepreneurship”
As always, I curious to know about likeminded people. If you want to start your own thing, feel free to connect with me and let’s have a chat.