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February 2018

Lifestyle Business vs. Innovation Driven Growth Business. There is no right or wrong, the choice is yours.

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Note:  I first posted on this subject nearly two years ago, yet it seems to always be on my mind.  I was especially reminded of this discussion on my visit last week to the Platter's Chocolate facility in Tonawanda, NY last week.  The owner, Joe Urban exemplifies all that is great about a small business owner and team growing a successful operation. With a nearly 80 year history under their belt they haven't gone public and don't employ 1,000s, but they have built a great business that employs many, is creating memories for its customers and is a critical part of our community.  I was inspired during that visit to remind all of us just how important the small business community is to our economy. I've updated that original post here with new numbers and a couple fresh thoughts.  I hope you enjoy it. If you do, join the conversation.

Having recently read an article discussing the distinct differences between today’s “tech bubble” and that of the “dot-com” disaster of yester years, I was reminded of a conversation I had with a local entrepreneur attempting a tech startup.

In the course of the conversation, it became clear that he had little respect for the lifestyle entrepreneur. In his mind, if you aren’t building a rapidly scaling innovation driven enterprise, you are insignificant.  I found his attitude a little off putting for many reasons.  We’ll get there in a minute, but let me start by saying I fully support investment in the innovation-driven economy. 

I will be the first person to say yes to government agencies “priming the pump” in communities like Buffalo, NY to get the high-tech flywheel spinning.  It’s critically important.  This is the world of commercializing innovative ideas and new technologies.  Successful technology-driven companies have the potential to scale quickly and create jobs at a faster pace than lifestyle businesses. However, they also have their own challenges - high failure rates, large capital investment and tradable jobs that can easily be moved around the globe. 

That being said, there is another huge sector of our economy driven by small businesses that doesn’t get the credit it deserves. We need to acknowledge and support the importance of the small business community and the positive impact it has on our communities and economies.  

Consider some of these stats:

  • There are over 28,500,000 Small Businesses in the U.S.
  • U.S. small businesses employed about half or 56.8 million of the nation’s private workforce or 48% of the workforce
  • They make up 99.7% of all employers nationally
  • 97.7 percent of U.S. export firms are small businesses
  • 88.5% of U.S. employer firms have less than 20 employees and only .26% of U.S. businesses employ more than 500 people
  • 96% of all U.S. businesses gross less than $1M annually
  • Small business start their businesses on their own backs. 77% of small businesses rely on personal savings for their initial funds

Here’s the most interesting part.  Many of the businesses mentioned above are lifestyle businesses.  These are local businesses that we all rely on as part of our daily lives.  They include everything from your corner gas station to the pediatrician that cares for your children.  They are the local butcher, retail store, insurance agent and small community bank.  These business owners are your neighbors, friends, and community leaders.  They are woven tightly into the fabric of our communities, they create jobs and provide significant economic impact.  Without them, our local economies would quickly collapse and the concept of community would likely be lost.

Yes, innovation-driven entrepreneurship is an important piece of our economy, but please don’t discount the critically important role that lifestyle entrepreneurs play in the fabric of our society.  They deserve much more credit than most take the time to give them.

There isn’t a right or wrong - both have their advantages and disadvantages.  If you are starting a business, it is simply a choice you make. If you want to run a business that leaves you in control of your own destiny and allows you to create the hours and income that is right for you, then a lifestyle business is a great choice.  On the other hand, if you want to swing for the fences, scale quickly, and don’t mind giving up control to investors, then an innovation-driven enterprise may be the perfect choice. 

In the end, the choice is the individual entrepreneur’s. Whatever their choice, let’s be certain to acknowledge that neither is more important than the other and both have the potential to create jobs, inspire wealth and invigorate our communities through entrepreneurial development.

If you want to explore for yourself just how important small business is to the U.S. economy, download the latest issue of Small Business Administration’s Small Business Profiles for the States and TerritoriesIt is packed full of information about small business and its importance to our economy.


SUCCESS, the choice is YOURS

Lots of BooksThere are 200,000+ business book titles in print. Why? How many possible takes can one have on running a business?  Why do we keep buying them? I read a ton of business books and I have to say that there are some great ones, at the same time many (maybe even most) are just a regurgitation of those that came before them.  Yet, they keep coming. 

Business titles continue to be produced and business owners continue to buy them. The answer to why may lie in the fact that most business owners struggle with success and are looking for quick answers.  After working with over 1,000 small business owners I can safely say that the answer to your struggles likely isn't in a book.  Nearly always, it lies somewhere within. 

You will begin to experience success when you conquer your fears, when you focus on areas of strength and interest, when you assemble and lead reliable teams, and when you have built a business based on blueprints of your own imagining based in a purpose greater than solely making money. 

Having a successful business is a choice, not a right.  There are no magic pills, a book, or even a consultant that can guarantee your success.  Only you can, but you have to earn it. You have to take an active role in envisioning the business of your dreams and then methodically putting the pieces into place that will ensure your success.  The actual act of running a business  isn't all that complicated.  You can learn all of the necessary pieces, but no one except you can decide to eliminate the many distractions that enter your daily life and instead choose to focus on the few initiates that will truly move your business forward. 

You are in control, the choice is yours. Now choose.

Join us for a free webinar, February 27th at 8:30a.m. EST where we address the topic "Why Businesses Don't Scale"


Webinar - Why Just Survive When You Can Thrive?

Just in case you missed our first webinar and would like to have a look, simply click on our link below:

Webinar #1: Why Just Survive When You Can Thrive? 

Description:

If you’ve ever felt like you are on an island, with no real connection to others that might understand what it means to be a small to mid-size business owner, you are not alone. This webinar is for you!

Millions of business owners wake up each day feeling like their business owns them. They struggle to scale, struggle to reap the full financial rewards of their hard work, struggle to keep good people and struggle to find a few minutes of free time to enjoy family and friends.

Join us as we share insights we’ve gained by working with over 1,000 entrepreneurs. We will share some “next and best practices” that form a solid foundation for any great business, but we’ll also share insights on what we believe is the real game changer for entrepreneurial success…addressing the “heart of the entrepreneur”.

Join us for this free webinar where we will begin to conquer your hidden fears that almost all entrepreneurs share, encourage you to focus on your unique strengths as a business leader and help you to create an actionable strategic vision for your future.

Presented by: UB School of Management Center for Entrepreneurial Leadership