Hobby v. Business

I’ve learned the hard way that it’s possible to think you’re running a real business when you’re actually running a hobby. Here are some differences so that you can tell them apart:

Activity Hobby
I make … whatever I want whatever customers want
I do .. whatever I want whatever it takes to learn what customers will pay for and then deliver it to them
I buy … whatever equipment, tools and software (a.k.a. ‘toys’) that I want only what will enable me to deliver what customers will pay for (otherwise I save my money)
I focus on … my business (i.e. my hobby) whatever it takes to make the business work (including getting a job if necessary)
I know … what customers want (they want whatever I decide to make!) that I don’t know what customers want – I must visit potential customers and learn from them.
I want … positive feedback (what if people don’t like what I make?!?) real feedback (because I’m committed to making whatever customers want)
I celebrate … low value sales (this is working! all of my dreams are validated! I should go all in!) every sale but recognise that there’s a long, long way to go before this business will generate real income
I spend my time … making things (whatever I want to make) learning from customers until I understand their problem (and then I sell and build them a solution).

That doesn’t mean, of course, that you can’t turn your hobby into a real business in the future. What it means is that:

  1. you must know whether you’ve got a hobby or a business,
  2. your hobby must not be run like a business (or it will lose its joy), and
  3. your business must not be run like a hobby (or it will fail).