Business or Hobby?
As I walked out of the light from the podium to gratefully accept a glass of wine, I was applauded for speaking to fellow students at a careers event. People swarmed me and bombarded my brain with commercial questions about my hobby.
My hobby was their business.
My hobby had once been my business too. In August 2018, during my second year of university, I spent a summer researching logos and commercial licences. I created a brand for my video production company (Patos Productions) and even hired freelancers to help with the work. Fast forward to 2020 and it was rebranded - in my brain at least - to ‘hobby’.
My friends have experienced the opposite. Their businesses which they throw their heart and soul into, as well as often thousands of pounds, have been called out as hobbies, pastimes, and leisure pursuits. Not surprisingly, this can cause intense aggravation.
To their owners, these projects are categorised as ‘business’ or ‘hobby’ effortlessly. The problem comes that outsiders to the project can also classify them with ease – potentially into a different category.
Why are these projects so difficult to label?
Human beings label objects and events to broaden comprehension. Take a table for example; two tables may appear as different as a rocket ship and a flowerpot yet point at them both and ask a five-year-old what they are and ‘table’ will most likely be the response.
Humans are supremely intelligent. This quick categorisation prowess keeps us ahead of our predators. We can predict, infer, and learn in an agile manner and humans do not just categorise the tangible, but the conceptual as well. Social categorisation is analogous yet much more perilous; it might not matter if you treat a chair as you would a table, but mis-categorising peoples’ social groups can result in intense prejudice, domination and even violence.
What makes someone regard a project as a ‘business’ or a ‘hobby’?
When I was researching, business owners often initially lamented by saying ‘Would I be spending this much time and money if it was just for casual enjoyment?!’ Most start-ups will need at least a few thousand to start, although using a lean start-up model can really reduce expenses. The lean model still comes with a cost though: time. Millions of hours are thrown into growing small businesses each year and, if you are starting out with limited finance, the hours working for free are even more steep. However, I can think of numerous friends who have spent days and days on hobbies like gaming. What is more, if your hobby is expensive, such as restoring or upgrading cars, then thousands of pounds may be only the tip of the iceberg. Undoubtedly, throwing in time and money to your project illustrates your commitment, but alone it is not enough for a project to be labelled as a ‘business’ rather than a ‘hobby’.
There are practical reasons why some projects are labelled as ‘business’ and some as ‘hobby’. Different governments have varied criteria so that the tax office can decide whether the project can claim back expenses from their tax. This centres mainly around intent to make profit and success in profit making over previous tax years. Interestingly, however, there is a nuanced criterion: Do you personally regard this as a business or a hobby? Even the tax man is interested in the personal feelings of individuals towards their project.
If it is not the effort being put in that characterises the project, then perhaps the industry it is situated. Think of some people with jobs which mean little to them and they spend little time there also - they may not put in as much time and money as some people conducting hobbies, and they may not even continue to grow and make more profit as per the government definition. However, because of the established business industry, a these jobs are unlikely to be mislabelled as ‘hobby’ by outsiders.
This solves some of the conundrum, but there is no doubt that many traditional hobby activities can be businesses. Take a photographer for example. Although there are billions people taking photographs everyday as a hobby, some are professional and have freelance businesses. In this situation the activity at the centre of the project is not so important, the key factor is the person.
Since the 1980s there has been a rise in the importance of brand for every aspect of life - even in individual people, which is known as BrandME. This has only been exacerbated by social media. Everyday we are told to brand ourselves in every aspect of life – to portray ourselves as who we want to be. Could the label of our project be related to how we view ourselves?
For me, most definitely. I regard myself as an ‘entrepreneur’ and one way I displayed this to the world was through setting up a small business. Others I know would balk at labelling themselves as entrepreneurial or as a businesswoman/man. Instead, they use different labels such as ‘artist’, ‘musician’, and ‘creative’. Labelling their project as ‘business’ wouldn’t help strengthen their personal brand and so it is labelled as a ‘hobby’ or, more likely, a ‘job’.
The words ‘job’ and ‘work’ cut to the crux of the issue. If someone considers their project as their career, or at least related, it is much more likely to be categorised ‘business’. In contrast someone who wants to keep their project ticking along separately from their career path will likely label their project as a ‘hobby’ partly so their workplace does not contest, but mostly for personal clarification. Within these extremes comes a transition in categorisation linked to proximity to career aspirations.
For me, the most important thing is that however you wish to label your hobby or business remains up to you. My labels may not be for you at all – perhaps ‘side-project’ or ‘venture’ is more your style. Nevertheless, I hope everyone interacting with a project now understands the impossibility of project labels and are more forgiving on those who get it wrong.
Written by Charlotte Ward
Charlotte has just moved to London for a new job in the corporate world but still has bunches of creativity! She will usually be found making a documentary film, but occasionally writing about important issues to do with innovation and history