I kind of hate the term “lifestyle” business, but I use it sometimes since it’s quick shorthand when I’m talking about the many, many self-employed folks out there who are motivated less by profits and more by personal freedom (I count myself among the ranks here). To me the term is somehow a little insulting and I think devalues this approach to self-employment. Since it’s also used often to describe women-owned businesses I find myself a little sensitive to that too, as if a woman-owned microbusiness is somehow nothing more than a silly hobby. But I haven’t yet come up with a better term, so for the moment I guess I’ll just try to reclaim rather than replace it.
Anyhoo, I was reading an article on Huffington Post yesterday about the White House Forum on Women and the Economy, written by Gina Harman, the president and CEO of ACCION USA, a microfinance organization that helps entrepreneurs with loans, consulting and other resources. The article mentioned some recent statistics about the fast-growing numbers of women-owned businesses in the U.S., citing both a White House report Keeping America’s Women Moving Forward: The Key to an Economy Built to Last (PDF) and a report issued in late March by the American Express OPEN Forum, the State of Women-Owned Businesses Report. Women-owned businesses have been one of the fastest growing sectors of the economy for decades now, and the recent studies show this trend continuing.
Another persistent trend among women-owned businesses is that they tend to be smaller than men-owned businesses, both in terms of revenues and numbers of employees. While some see this as cause for concern, my feeling is that it at least in part reflects women’s different priorities when starting businesses. Studies and surveys consistently show that women tend to be more concerned with work-life balance than men are, which often translates into companies that aren’t quite as growth-oriented.
Is this a bad thing? I don’t think so. As I put it on the comments page of the Huffington Post article:
I think it’s worth noting that women typically report different goals and priorities when starting businesses than men do, which is a factor in the statistics showing that women-owned businesses tend to be smaller and less growth-oriented than men-owned businesses. While on one hand I definitely want to see a more gender-level playing field in terms of access to capital, I also think it’s time to give smaller ventures and “lifestyle” businesses a little more respect.
Starting a business with personal goals firmly in mind — say, wanting to spend more time with family or pursuing creative work — is not only a valid choice, it’s often a wise one too. I see too many new entrepreneurs get overwhelmed and burned out by their ventures in large part because they started their businesses without clear big-picture goals and a realistic vision. This is a particular shame for those who pursue self-employment because they’re tired of being a slave to their job.
What do you think? Is the fact that women-owned businesses tend to be smaller a cause for concern?