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Lifestyle Startups Stigma

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Re: Lifestyle Startups Stigma

#31

Post by fleitz »

tlogan wrote: post #27

I was always under impression that lifestyle business is a startup which cannot or is not willing raise money. Meaning sometimes even if your business is profitable (like my little business), VC will not invest since it lacks growth potentials. So business goes like this: "find business model" -> "optimize business model" -> "scale your business" Sometimes, in the first step you find a business model which is profita…

Raising money does not necessarily mean taking VC or giving up equity.

Have you ever thought that VCs have a vested interest in perpetuating the idea that to be a "real" business you need to give up equity in order to raise money?

Re: Lifestyle Startups Stigma

#32

Post by fleitz »

My personal view is that this stigma stems largely from two sources:

1) VCs who have a vested interest in getting people to give up equity in order to raise money.

2) People who have sold equity in exchange for VC money need to make themselves feel good about their decision so they look down on others who have a business plan solid enough not to need to tap the capital source of last resort.

Re: Lifestyle Startups Stigma

#33

Post by fleitz »

dmor wrote: post #3

I think this stigma exists because on some level, sometimes, when things suck at your high growth crazy startup (even if its just a bad day or week) you think, "man I wish I ran a skate shop in Huntington Beach with an online store". And it stings to see other people doing that. It's a lot harder to delay gratification and swing for the fences, not just intellectually harder but emotionally harder. Sometimes I feel l…

Dulce et decorum est pro patria mori is what I think.

I don't care about the 'glory' of a startup, glory is something you tell stupid 18 year old kids so they feel good about going to die for 60 year old kids.

If you can make money with out risk you're an idiot to go and find a business with lots of risk controlled by someone else.

Don't dig for gold, sell shovels!

Did you know that the people who sell plastic wrap for hard drives have a higher profit margin than those who make hard drives? Think about the ramifications of that for a second.

Laugh inside when you get made fun of for not having the stomach to risk digging for gold. Enjoy your life find your esteem from yourself and not from the opinions of the masses, it's you who has to live your life, not the others commenting on it. If raising VC makes you happy, then raise VC. If a lifestyle biz makes you happy run a lifestyle biz. If being a programmer in a cubefarm at a megacorp makes you happy, do that!

Re: Lifestyle Startups Stigma

#34

Post by pg »

JoelSutherland wrote: post #26
pg wrote: post #13

There's already a word for a lifestyle startup: a business.

The author says: "There is a stigma against running a lifestyle startup (business)" PG Says: "Please don't even use the word startup when describing what you do."

In current usage, a startup means a new business that is designed to scale rapidly. (Most don't actually manage to, but they're at least intended to.) It would be inconvenient if people started using the word to describe new businesses generally, because then we'd need to invent a new word for the subset designed to scale rapidly.

Re: Lifestyle Startups Stigma

#35

Post by timjahn »

cwp wrote: post #14

Gimme a break. There's no mystery here. "Tech elite" is a code word for venture capital. VCs pooh-pooh lifestyle and bootstrapped businesses because there's no opportunity for them to profit. VC-backed founders have been successful at raising investment, so of course they're not interested in a business that doesn't require it. Both groups want to define success in terms that give them a business advantage.

Perfectly said.

Re: Lifestyle Startups Stigma

#36

Post by viscanti »

dmor wrote: post #28
viscanti wrote: post #25

Earlier quoted context omitted.

I disagree. You need to solve a problem you're passionate about. Not all problems are BIG problems that require massive scale or raising money. Lifestyle startups aren't a myth. They're just working on a different scale of problem than the VC backed startup. I don't know that there's anything inherently better about either, but treating a lifestyle startup as a scalable startup, or vice versa is a mistake. They're se…

some businesses are just businesses, not startups, and thats ok.

I suppose our definition of "startup" differs. It seems a startup can only be a startup if it's attempting to solve a problem that requires significant upfront capital and scaling. I disagree with that view.

For me, a startup is a company exploring the solution to a problem. That can be a BIG problem and that requires significant scaling, or it can be a smaller problem. Once that solution is found, and can be replicated easily, it's no longer a startup.

The question is, how long can a startup be a startup? I'd argue that as soon as any scaling is involved, it's no longer a startup and it's just a business. Startup implies that it's the start. Lifestyle businesses and regular businesses can both be guilty of claiming to be a startup long after they've become "regular" businesses.

When it comes down to it, they're all just businesses, but it can be helpful to have terms to distinguish the scale of the business. If you feel that lifestyle businesses and lifestyle startups are diminishing the prestige of startups, then you're probably in business for the wrong reason. That smacks of too much ego and too little passion for solving the problems you should be solving.

Re: Lifestyle Startups Stigma

#37

Post by hristiank »

pg wrote: post #34
JoelSutherland wrote: post #26

Earlier quoted context omitted.

The author says: "There is a stigma against running a lifestyle startup (business)" PG Says: "Please don't even use the word startup when describing what you do."

In current usage, a startup means a new business that is designed to scale rapidly. (Most don't actually manage to, but they're at least intended to.) It would be inconvenient if people started using the word to describe new businesses generally, because then we'd need to invent a new word for the subset designed to scale rapidly.

PG I actually thought about my article heading a lot and went back and fort between lifestyle "startups, businesses and entrepreneurs" for the right word to describe my post. At the end I decided on startups since the other two words are further off what I intended to convey. But I definitely can see your point and how it can become confusing.

Re: Lifestyle Startups Stigma

#38

Post by guylhem »

fleitz wrote: post #33
dmor wrote: post #3

I think this stigma exists because on some level, sometimes, when things suck at your high growth crazy startup (even if its just a bad day or week) you think, "man I wish I ran a skate shop in Huntington Beach with an online store". And it stings to see other people doing that. It's a lot harder to delay gratification and swing for the fences, not just intellectually harder but emotionally harder. Sometimes I feel l…

Dulce et decorum est pro patria mori is what I think. I don't care about the 'glory' of a startup, glory is something you tell stupid 18 year old kids so they feel good about going to die for 60 year old kids. If you can make money with out risk you're an idiot to go and find a business with lots of risk controlled by someone else. Don't dig for gold, sell shovels! Did you know that the people who sell plastic wrap f…

"I don't care about the 'glory' of a startup, glory is something you tell stupid 18 year old kids so they feel good about going to die for 60 year old kids."

Beautiful :-) But what about passion?

"Did you know that the people who sell plastic wrap for hard drives have a higher profit margin than those who make hard drives? Think about the ramifications of that for a second."

No I didn't, but that's very interesting. Yet I doubt anyone here would be funding a company making new plastic wraps.

Re: Lifestyle Startups Stigma

#39

Post by fleitz »

guylhem wrote: post #38
fleitz wrote: post #33

Earlier quoted context omitted.

Dulce et decorum est pro patria mori is what I think. I don't care about the 'glory' of a startup, glory is something you tell stupid 18 year old kids so they feel good about going to die for 60 year old kids. If you can make money with out risk you're an idiot to go and find a business with lots of risk controlled by someone else. Don't dig for gold, sell shovels! Did you know that the people who sell plastic wrap f…

"I don't care about the 'glory' of a startup, glory is something you tell stupid 18 year old kids so they feel good about going to die for 60 year old kids." Beautiful :-) But what about passion? "Did you know that the people who sell plastic wrap for hard drives have a higher profit margin than those who make hard drives? Think about the ramifications of that for a second." No I didn't, but that's very interesting.…

I'd put passion largely in the same category of glory. It's an emotional good used to get people to accept lower returns.

I'll use the video game industry as an example, people are passionate about writing video games, their not passionate about not being able to see their family and friends for weeks. People are told they need to sacrifice to follow their passion but really they are sacrificing so the company can hit some arbitrary date and extract more rev from each employee, eventually to be discarded by the company when they are no longer profitable.

If your passionate about video games it's probably better to get a iPhone / Android / XNA dev account and make video games than to go work for a video game company (or your VC).

People are passionate about leaving their mark on the world via a business, not making sure their VC gets their 2X earn out.

Re: Lifestyle Startups Stigma

#40

Post by kbutler »

pg wrote: post #34
JoelSutherland wrote: post #26

Earlier quoted context omitted.

The author says: "There is a stigma against running a lifestyle startup (business)" PG Says: "Please don't even use the word startup when describing what you do."

In current usage, a startup means a new business that is designed to scale rapidly. (Most don't actually manage to, but they're at least intended to.) It would be inconvenient if people started using the word to describe new businesses generally, because then we'd need to invent a new word for the subset designed to scale rapidly.

Merriam-Webster disagrees:

http://www.merriam-webster.com/dictionary/startup 1: the act or an instance of setting in operation or motion 2: a fledgling business enterprise

Fledgling also lacks any connotation of scaling.

Perhaps the VC/angel community has adopted "startup" to imply design for rapid scaling, but the broader community uses startup to mean "new business."

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