
The lifestyle business bullshit - sant0sk1
http://www.37signals.com/svn/posts/1686-the-lifestyle-business-bullshit
======
smoody
It's a lot easier when you have a strong brand (corporate and personal). It's
not so easy when you don't. Granted, they had no brand when they started
(which was in a different climate than the climate facing startups today), but
I think they've forgotten what it's like to be brandless, moneyless, etc.

If they want to prove their constant mantra of "anyone can do it!," then they
should try this: Start a new company with a new company name, use aliases for
their own names, live on ramen noodles for eight months (or many more), and
see if they can repeat their success. If they can do it, then I'll be the
first to sing their praises.

They've created exactly one successful company (a huge achievement to be
sure). However, that doesn't qualify them to spread general wisdom about how
anyone can do the same.

I'm not saying that their ideas for creating products people love are bad or
wrong. They're actually quite good (and perhaps even intuitive to anyone who
sits down and really thinks about it instead of just wanting to read about
it). But one can't extrapolate broad patterns from a single macro datapoint.

Of course anyone is free to say whatever they want and I'm not suggesting that
they or anyone else should stop expressing their opinions -- opinions are what
make the Internet great. :-)

~~~
mechanical_fish
_They've created exactly one successful company (a huge achievement to be
sure). However, that doesn't qualify them to spread general wisdom about how
anyone can do the same._

So... who is qualified?

Steve Jobs, maybe. But even Steve can't meet your crazy criterion: He's not
dumb enough to have run NeXT and Pixar under an alias. He used his own name.
Because he had invested a lot of time in that name and it remains one of his
biggest assets. And because it's probably _impossible_ for Steve Jobs to run
away from his name. And because, even if he changed his name and got plastic
surgery, everyone would _know_ it was a Steve Jobs company. I'm told that
working for Steve Jobs is a really unmistakable experience. His style sticks
out from a mile away.

Business isn't a science. All you _get_ is anecdotes. You have to do what
everyone else in Silicon Valley does: look at what Fairchild or Hewlett-
Packard or Apple or Google did, and try to generalize. You might accidentally
overgeneralize. Try to survive anyway.

------
webwright
Gah, it's honestly the people who RUN lifestyle businesses who make it such a
dirty word. It's not, and you should stop being defensive about it.

People's dreams vary. Some people want to change the world in a big way and
gain satisfaction from herculean effort against incredible odds. Other people
aspire to a comfortable living and a life that has lots of room for non-work
activities. There's no shame in either.

~~~
dhh
Another bullshit dichotomy. We want to change the world in a big way. We
certainly face hard odds (building a multi-million dollar business is very
hard regardless of how you go about it). We just want to do all of that and do
other things at the same time. So far that has been going pretty well.

~~~
mixmax
I honestly don't think 37Signals is changing the world in a big way. You're
not inventing the transistor, you're making one of many online to-do lists and
chats. I'm not saying the products aren't nice, they are. But they aren't
gamechanging in any way.

You're great at marketing though.

~~~
hbien
I'm pretty sure Rails was game changing.

~~~
omouse
Maybe in the way it's encouraged other web frameworks to adopt MVC, but that's
not a huge deal. MVC has been around for a long time anyhow.

~~~
derefr
It didn't change the _whole_ world _just a little bit_ (which is what most
people mean by "change the world"); it changed _one tiny segment_ of the
world—webapp programming— _a lot_. I think that's even more laudable.

------
strlen
"...still have time for taking flying lessons, learning to play the guitar,
nurture your garden, go hiking, enjoy cooking, socialize with people outside
your tech circle."

One doesn't have to run a 37-signals style business ("do less", no external
investment, charge customers immediately) to do this. One doesn't even have to
limit themselves to a traditional 35-45 hour work week to do so. This is
entirely possible while being a "workaholic", if you aren't wasting your time.
I'd say that those who _do_ spend all waking hours on technology (and I used
to be one of those) generally do so out of preference, anxiety or combination
of those two.

Note: I am also not implying there's anything with either running a 37-signals
style business _or_ spending all waking hours working. Depending on what your
goals and preference are, all these are legitimate choices.

------
mauricio
I think a lifestyle business isn't necessarily defined by the amount of hours
you work but rather how much you earn. If your business earns X and you are
content earning X because it supports your 'lifestyle', then you have a
lifestyle business.

I don't think a lifestyle business is negative nor am implying that 37Signals
is a lifestyle business. Just think you have it mixed up is all...

------
nazgulnarsil
37signals is crossing the line from confident into arrogant hubris. It's
understandable. The incentives in the eyeball/clicks world is to be
inflammatory. Doesn't mean we should be paying attention.

------
axod
From wikipedia: "Lifestyle Businesses are businesses that are set up and run
by their founders primarily with the aim of sustaining a particular level of
income and no more; Lifestyle Businesses typically have limited scalability
and potential for growth because such growth would destroy the very lifestyle
for which their owner-managers set them up."

And from 37signals blog: "We haven’t found the natural size for 37signals yet,
but I can tell you that it’s not a thousand people. It’s highly unlike to be a
hundred. Right now it’s 10 and it’s been in that vicinity for quite some
time."

You can't really complain you get the 'lifestyle business' tag... As far as I
see, it's pretty much the definition of one.

~~~
dhh
You are equating growth with head count, which is a common fallacy, but still
a fallacy. Our measure of growth and success is profit and growth in profit.
For the past many years now, we've had spectacular yearly growth and we've yet
managed to avoid destroying the lifestyle we're enjoying.

Preferably we wouldn't hire another person for the next 10 years, but still
dramatically increase our profits. To me, there's no growth in just adding to
the head count without increasing profits. That's just deadweight.

~~~
axod
Without a head count growth though, you're just supporting a lifestyle.
Surely. That's great, and it depends on your priorities.

But as far as I see it, that's the definition of a lifestyle business -
sacrificing growth of the business (In terms of head count), for 'lifestyle'.
With a very small team, that profit seems quite risky to me.

(I would also say plentyoffish is a lifestyle business at the moment from what
I know about it). From what I've read, there's a very small team, not growing
in head count, making a lot of money.

>> To me, there's no growth in just adding to the head count without
increasing profits. That's just deadweight.

I think it's a good thing to employ more people, if it's going to work in the
long term. Sacrificing 'lifestyle' now, to build a big company.

You can either take the profit, or you can reinvest it in people for the long
term, and build something big.

>> "Our measure of growth and success is profit and growth in profit."

Which is more risky? 1 person earning $10m a year, or 10 people earning $1m
each a year within the same company?

~~~
dhh
I'm on board with the term "lifestyle business" if we make it imply "very
profitable business that continues to grow revenues without adding additional
cost". I would think that's the nirvana description of any business, though.

"Which is more risky? 1 person earning $10m a year, or 10 people earning $1m
each a year within the same company?", that simply doesn't compute. If all
those 10 guys are making their $1 million each from selling web ads where as
the 1 guy is making his $10 million selling subscription software, I know who
I'd want to place my money with right now.

~~~
axod
I'd place mine firmly with the web ads ;)

I agree @ keep costs low, but I still think the definition of a lifestyle
business is one that isn't growing in terms of the _business_.

If you liken it to a house rental. You could have the best house in the world,
and be able to rent it out for $5m a year. That'd give you a great lifestyle,
but even if you can manage to rent it out for $6m the next year, that's not
_business_ growth. _business_ growth would be renting out 2 properties, 3, etc
etc. Reinvesting the profit into the business in order to provide sustainable
long term growth.

>> "I would think that's the nirvana description of any business, though."

So I'd disagree with this. Not every business wants profits over future
growth.

~~~
gills
I know you're not just trolling, because you contribute many insightful
comments on HN, but I just don't see why you are so focused on headcount as
the measure of business growth.

The low marginal cost of additional customers in a subscription software
business makes your argument an apples-to-oranges comparison. You might need
to hire additional staff to manage and maintain a growing portfolio of rental
properties, but with subscription software you only have to improve your CRM
tools and development processes to maintain a growing customer base with near-
constant headcount. If better CRM tools happens to be what you are selling
anyway, there's a pretty obvious multiplier for growing profits with very low
headcount growth.

~~~
axod
>> "but I just don't see why you are so focused on headcount as the measure of
business growth."

Because that's the commonly held definition of "Not a lifestyle business" :/

------
antidaily
I don't disagree with DHH but I bet if you totaled the hours spent blogging,
redesigning FedEx for fun, giving talks at conferences, fixing Rails bugs,
etc. the 37signals crew works about as much as anyone else. I want to know who
is calling them a lifestyle business. Did that even happen?

~~~
dhh
As much as what? And what are you willing to bet :)?

We certainly don't have a 4-hour work week, but we sure don't keep a 60-hour
one either. Yes, there are exceptional weeks here and there were there's a
brief spike, but those are just that, exceptions.

On average, we all take time to spend lots of it away from a computer. I think
having a healthy hobby and social life outside of computers will only make you
a better business person, not to mention a more well-rounded human.

Your 20'ies and 30'ies are your most capable for physical activity. In my
mind, you'd do well to spend a fair amount of that potential.

Of course, you're free to do whatever the hell you please. Just don't make
excuses like "I have to, that's the only way to be successful". Oh, and stop
calling people who do pursue that balance "lifestyle businesses" unless you
literally mean that the have both a life, style, and a business ;)

------
n8tron
These guys really, really – I mean REALLY – like to talk about themselves. We
get it, you're cool. Now please help port some more gems for Ruby 1.9.

~~~
mlinsey
Judging by how frequently they make the front page, people on HN really,
really like to talk about them as well.

Their perspective is intriguing, even if it isn't generalizable.

