The THREE TYPES of Business Based On

Entrepreneurial Objective

Before anything else, please read this little disclaimer:

DON'T BELIEVE A WORD I SAY

Everything I will share here is based on my own experience as an entrepreneur and my years of
observing businesses, entrepreneurs and investors from many industries. So in order for you to
gain wisdom from these notes please do your own thinking and research.

There are three types of businesses based on the entrepreneur's objective

*for the sake of simplicity we will consider everybody who starts a business as an entrepreneur

Lifestyle business

- most people who start a business build a lifestyle business.

- major objective is to create income that can support your lifestyle. Ideally to generate enough
passive income to become financially free.

- normally here it is a marketing based business (affiliate marketing, network marketing),

ecommerce, reselling.

- you can mostly do this at home -> Home based business

- this can also include a traditional mom and pop small business. Although this has, generally,
less income potential (in relation to the cost involved to start and operate it) and also has higher
risks and more headaches.

- if this is the goal then your passion comes last when trying to build this kind of business (I will
make another FB live to discuss how to select the kind of business you should get into if you
want passive income).

- Major aspect to note here is that you should pursue businesses in proven markets
- While passive income is your objective for this business, you should be building assets here
(wink wink your email list).

Disruptive/Innovative Business

- think of when Google, Facebook or even Tesla.

- your major objective for this kind of business normally is to "disrupt" markets.

- normally you have an idea or a passion you wish to turn into a business and it doesn't
necessarily have any proven market/customers -> It's part of the process to test and/or create
customer need. Or you wish to DISRUPT a proven market to etch out a Blue Ocean.

- this is the reason why entrepreneurs doing this type of business majorly look for investors in
order to fund their "market creation/customer development" processes.

- normally these kinds of business take a long time before they generate real revenue or profit
(think of Facebook, it started in 2004 but it generated real revenue in 2012).

- They sustain themselves because of capital infusions from investors.

- Their major objective is to realize their ideas, money may be just secondary.

- They are in a business of building an asset -> Usually customers. Investors are willing to pour
money into them because they are quickly building up their customer list (network effect).

- Only a few percentage succeed

- financially the reward is that if the business is a hit then you can become a multimillionaire (or
even a billionaire) overnight through being acquired by a bigger company (think of WhatsApp) or
initial public offerings (IPO's).

Big Venture Businesses

- these are business you normally take on IF you have a corporate entity which can access big
funds OR can partner with other big companies.

- you start a business like this not to become rich because the only way for you to be able to
start this kind of business is IF you are already rich.
- businesses like for example building a smart city or even a plant to manufacture cars (think
Tesla).

- your goal here is not anymore simply passive income (usually you already start as someone
who's financially free when you do this kind of business). Your goal is actually to increase your
net worth.

Some thoughts on this...

- Personally I am or have been involved in each of these three business types in different
capacities (I'm doing affiliate marketing/i've done network marketing, I have worked in a startup
as a software engineer and also been awarded some shares in another one while helping them
build their app, I used to work as an engineer for a large energy company which allowed me to
see big business deals at work up close).

- there isn't any right or wrong objective for going into business. Of course if you have the
resources, the skills and the connections necessary to start a big venture business then go for
it.

- but for most people who are starting, a lifestyle business is what you should be building -> it's
the simplest and easiest to start (except probably a mom and pop small business where you
often need bigger capital).

- as a lifestyle business entrepreneur you can of course, if you want to, pursue the
disruptive/innovative and/or the big venture business later on.

- There are different skills, financial resources and people resources required to succeed in
each type of business. So it's important you know which one you are in right now to be able to
master and harness those skills.

- Although I must say if you're in the Lifestyle business right now and you master the skills
necessary to succeed here? If and when you decide to do a disruptive/innovative business or if
somehow you get an opportunity to do a big venture business, the skills you learn doing a
lifestyle homebased business will increase your chance of success.

If you want to start a profitable home-based lifestyle business then check ​this​ out.