Today there are, perhaps, three types of entrepreneur:
- The traditional bricks and mortar business owners
- The online business owners who strive to be laptop millionaires
- Those who forgo chasing the big bucks and choose to do what they enjoy with a lifestyle orientated business.
The second group has coined the phrase “Lifestyle Entrepreneur” i.e. those who seek a passive income online to free up their time, so they can spend it how they want. In reality, perhaps it is the third group who should be given this title. If you can do what you love, something that fills your life with meaning, whilst still enabling you to make enough money to live comfortably, then perhaps you have found the best work life balance. There is, of course, often a cross over between all three types of entrepreneur. Many traditional business owners also love what they are doing. If it is their passion they may relish working many hours a week to make the business a success. An online presence is also required to promote a lifestyle business such as a small holding or market stall to bring in additional revenue.
When we think of a traditional entrepreneur we probably think of the Dragon’s Den style business man or woman, driven, successful and most certainly rich. Someone who built their businesses from scratch by working sixteen hours a day, seven days a week. The art of the deal has become their passion and to some extent their business defines them.
You only have to check out YouTube and Facebook to find the new breed of successful laptop entrepreneurs. Those who are lucky enough to make good money working only a few hours a week. Perhaps running an internet business from their iPad whilst sailing round the world or living on the beach.
The true lifestyle entrepreneur on the other hand may have downsized their life to enable them to escape the rat race whilst living on a lower income. This may have allowed them to follow a hobby or passion that is less lucrative than other businesses. Or it may allow them just to reduce the hours they need to work to spend more time bringing up a family.
The internet has become a great equalizer amongst business owners. It is an amazing resource. Instead of huge investment in machinery, offices or materials; now we just need a computer or tablet to create an income. The breadth of businesses we can create online is as infinite as our imagination. We can create digital products practically for free and sell them in a virtual shop. Used wisely, the internet has also given us the one thing money can’t easily buy – time. We no longer need to commute to work, or even attend meetings in person. It is possible to simply logon, read and answer our email or have a video conference call with colleagues, suppliers and customers. We can shop online instead of spending weekends in traffic and queues at the shops. Our knowledge can also be improved and we can carry out research from the comfort of our armchairs.
Pre-Facebook (2004) or YouTube (2005), one would have needed a huge marketing budget to compete with big businesses. Now teenagers with a Vlog can reach as large an audience through their social media following as any multimillion dollar advertising campaign. You can now reach all corners of the globe with a press of a button.
Consider two routes to starting a successful business: The first is becoming a traditional entrepreneur in this case by opening a physical shop on the high street. The second is that of a laptop entrepreneur running an online shop selling a digital product.
For the first, we potentially need a large up-front investment to cover the cost of initial rent of the premises, stock, staff wages and initial launch advertising. We may need to get this via a loan from a bank. From day one we may have substantial costs.
For the second we need a website, which can be set up for the cost of a domain name (from £1) and a hosting platform (generally less than £100 per year). For those with basic computing skills it is possible to learn to use one of many software packages or online platforms to create a professional looking website without paying anyone.
Comparing ongoing costs: the shop front owner needs to repay the loan, continuously manage cash flow to replace stock, cover salaries and even utilities such as heating and lighting. To stand out from the crowd, a traditional business may also need a marketing scheme that includes newspaper advertising, radio advertising and leaflet dropping in the local area, in addition to a modern online presence.
The online shop owner launches their website by simply sending the link to all their friends on Facebook and Twitter and asking them to share the good news.
Time invested is another huge tick for the online business owner (who may be sipping a Mojito on the sun lounger as they send their first product launch campaign out). Both styles of business will need to invest time in designing advertising campaigns, completing their accounts and tax returns. In the early days, however, the shop owner also has to be present all the hours the shop is open (maybe 8-6, 6 days a week). When not working in the shop they need to be dealing with suppliers, managing stock levels and returns on a constant basis. The internet business owner, on the other hand, creates a digital product (for example an eBook on successfully running an online business). They do this once, place the advert on their website and that single creation has the possibility of selling time and time again for a single input of time and energy.
The above, of course, is very simplified. There are as many failed attempts at becoming an online success as there are successes. Today, the online audience demands respect. The most successful businesses offer a huge amount of quality, free information and their followers only pay for additional high-quality information once they have created a level of trust. Therefore, even the internet business owner has to work alot of hours, especially early on in the life of the business (unless they outsource the work which is a whole other subject).
The true lifestyle entrepreneur may be one that has found the perfect balance, they make enough to live comfortably without working too many hours doing what they enjoy. They may also have happened upon the magic formula that gives their lives more meaning than just making money. If you have found this Utopia, then please let us know 😊.