Why the Difference Between Startup and Microbusiness Might Matter to You


Like many people, I long thought that being self-employed was the key to freedom. It turns out that working for yourself can mean a lot of different things. How you go about it can mean the difference between creating your freedom and building a virtual prison.

If you’re thinking about or in the process of starting a new business, here are some thoughts to help you create something that will be friendly to your lifestyle.

The Startup Question

There is a lot of attention paid to startups. Entrepreneurs are seen as some type of modern cowboy or swashbuckler. Their successes are lauded, but their lifestyles and failures are often overlooked.

What are your goals for starting a company? The dream of most startup founders is either to: a) create a situation where being boss means they get to make all the decisions and dictate where, when and how they are involved, or b) to become rich by selling the business so they can live happily ever after doing whatever they’re really passionate about.

For many types of startups, neither of those dreams usually come true for a couple of reasons. The “getting rich” scenario is a long-shot. Everybody knows this when they go into it, but people either think that they have a better shot than most, or that it’s worth the gamble. I actually agree that it’s probably worth the gamble, if only for the experience of it all. If you happen to get rich along the way, good for you. Just don’t bet on it.

The other scenario of creating a business that enables your dream lifestyle also isn’t very likely, unless you’re very careful. Most people start a company, seek financing or venture capital, and grow a team of employees to build the business. Along with the financing comes a board of directors.

You’ll also probably have a business partner or two to have gotten that far. When you add up all those people, the board, co-founders and employees, it turns out that you’re not really the boss anymore. It’s more like you’ve created dozens of bosses for yourself that you have to answer to if you want to keep the dream alive.

That’s the scenario I ended up in with my last company. Again, I wouldn’t trade the experience for anything, but for my next business, I’m planning to design things quite a bit differently. I want to create a vehicle for achieving my ideal lifestyle, not a small army of bosses for myself.

The Microbusiness Answer

Advances in technology, communications and social media have made it possible to start and run certain types of businesses in a radically different manner. Instead of hiring employees, a company can rely solely on contractors. Instead of renting physical office space, people can communicate over Skype, through instant messaging, through email or social networks.

Some people call these new leaner companies “microbusinesses” and the people who start them “solopreneurs.” The goal is to make the business smaller, more able to adapt to market conditions, easier to run and grow, and most of all, more supportive of the owner’s lifestyle goals.

A microbusiness is loosely defined as a company with five or fewer employees. I prefer a definition that focuses more on the intent of the business than the size. After all, most businesses had five or less employees at one point. The more interesting definition would be “businesses that are designed to run and grow with five or fewer employees.” The intent, not the size, is really what matters.

I’m going the microbusiness route for my next business, and I’m already seeing the benefits. As I start working through ideas and testing concepts, I’m not beholden to anyone else’s timeline or expectations. That may change slightly as I move forward, but I’m intent on keeping my next endeavor lifestyle-friendly.

What if Every Business Was Lifestyle-friendly?

Does a business need to remain micro-sized in order to be lifestyle-friendly? Not at all. There are plenty of examples of successful companies with more than five employees who have managed to remain lifestyle friendly.

Some of the biggest businesses in the world are considering or switching to a results-only work environment. In that scenario, employees are able to work anywhere, anytime, as long as they produce results. There’s hope for cubicle dwellers that working for a big company and living a great lifestyle don’t have to be mutually exclusive.

In the world of technology startups, 37 Signals is a shining example of a successful lifestyle-friendly business. They focus on simplicity, both in their software products and in their business model. In their free book “Getting Real,” they lay out a revolutionary model for building software with a small location-independent team. They’ve proven the model time and again through multiple successful product launches.

In business consulting, Point B is leading the way in work-life balance in an industry traditionally known for long hours, grueling travel and personal sacrifice. I know because I used to work for both Point B, and one of the “traditional” firms. Point B doesn’t maintain corporate offices, they give consultants autonomy over their own projects and they are extremely supportive of sabbaticals, time off and working hours that fit with your life.

What really matters is that a company is focused on succeeding while allowing for better lifestyles. If you’re in charge of a business, or planning to start one, ask yourself “how can I make this business more lifestyle-friendly for myself and everyone involved?”

In the spirit of helping one another achieve our lifestyle goals, please share your thoughts on startups and lifestyle-friendly businesses below.

photo by Here’s Kate

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Hi, I’m Corbett Barr. I’ve been writing here since 2009. Join my email list for new articles about supporting yourself doing something you love: