Why happiness should be your business model

There’s a new breed of entrepreneur looking to realise their dreams – those that put people and happiness first. But what’s remarkable is how, in making this choice, these companies are becoming highly profitable.


Last year saw a huge surge in startup businesses across the UK. The Startup Britain campaign estimated 460,000 businesses were founded in the last 12 months. With only 25% of all startups continuing business a year after they’ve launched, the question on every budding entrepreneur’s lips is:

“What’s the secret to building a successful company?”

Well, we believe we have the answer… Zappos have done it. Southwest Airlines have done it, and more and more startup businesses are following suit.

They’re making happiness their business model.

Yes, you heard that right.

There’s a new breed of entrepreneur choosing happiness before profits. But what’s remarkable is how, in making this choice, these companies are becoming highly profitable. By placing the happiness of their employees and customers first, they’ve created incredibly strong cultures and an even happier balance sheet.

So if you’re one of those people setting out into the world of entrepreneurship, then it’s worth spending some time defining what will make you happy as this will give your startup a more solid foundation to build upon. Happy founders are the first essential component of happy startups.

Happiness in business starts with passion

We spend most of our waking lives at work. It’s a big part of who we are, so it’s important that however we’re earning a living, we’re enjoying what we do. By finding and following your passion, you’ll help to give your life real meaning and your business its mojo. The path to a profitable business starts with recognising where your passion lies. And don’t just think ‘what do I enjoy?’, but rather ‘which problems do I see that need addressing that get me excited?’.

It’s vital to your startup’s progression that you’re passionate about the problem you’re trying to solve. After all you’ll probably be devoting several years of your life and some long hours, so it’s vital that you’re into what you’re doing. If you’re not, it will show – in your ability to motivate yourself and others, the quality of your service or product and the relationships you build with your customers.

Happiness and effectiveness

Take a second and think about how you work when you’re not happy, when you’re feeling negative, anxious or stressed. Are you creative? Inspired? Motivated? Engaged? Is our productivity at its peak?

Our ability to work at our most effective reduces when we’re feeling stressed or under pressure. We can’t make decisions thoughtfully or work to our full potential.

Now turn it around. When you feel happy, how do you work? Are you charged up, feeling creative and positive about outcomes? More resilient and persistent when we suffer setbacks?

Our brains become more alert, open to ideas and innovation when we’re happy, letting us to work to our full potential. It’s a recipe for productivity that comes much easier to those whose business idea revolves around something they believe in.

“If employees are treated right, they treat the outside world right, the outside world uses the company’s product again, and that makes the shareholders happy.”
Herb Kelleher, Southwest Airlines

Happy employees = happy customers

Study after study proves that happy teams are more creative, productive and effective. Just think about it for a second. Happy employees are nicer to be around, they like making their customers happy and therefore work harder to achieve that. Happy customers spend more money, are more loyal to a brand and tell their friends and family. It’s a marketing plan in itself. Also, as a founder working with people you like on a business you believe in, means everyone can work together towards a common, meaningful goal.

It’s not a sexy graphic, but it proves that happier customers spend more

So who’s on board the happy bus?

As well as a variety of diverse businesses (Moo.com, Zappos, Innocent Drinks, etc) we’re seeing a movement of individuals that want to start businesses firstly as a lifestyle choice, and secondly to make money. These startup founders are choosing to do things differently for various reasons that may include:

  • Spending more time doing what they love
  • Spending more time with who they love (family, friends)
  • Flexibility to make better life choices (so they can make a difference in the world)
  • Solving problems they see that need fixing
  • The ability in choosing the environment they work in, with people they like.

How can you take action?

Start with the following 3-step process to making happiness your business model:

1) Define what success looks like to you

Before you start on your entrepreneurial journey, it’s vital that you consider what you’re in this for. Whatever success looks like, it’s probably not where you are now. Really spend time thinking about what your end goal is. Try to focus on the life you want and the change you want to make, not the numbers you need (that will come). Happiness should be your starting point for success. Also consider impact, legacy, relationships and the undervalued entity that is time.

“Have fun, do good and the money will come.”
Richard Branson

2) Define your startup DNA

We believe you can lay the foundations for success by really defining who you are and what you stand for – your values, passion and purpose. At The Happy Startup School, we believe passion trumps any kind of entrepreneurial experience. Defining your passion is what will drive you to succeed – after all if you’re not passionate about your business why should anyone else be? This passion will help you define your business purpose and help people rally around your cause.

Rather than saving ‘the real you’ for the margins of life, you’ll be living a 7 day weekend! It will create a contagiously happy environment for the people around you, with a positive effect on both productivity and profits. Having a clear purpose will help people to know why you exist, giving your brand more resilience and your company a reason for being. It will also help you make quicker decisions. We’ve developed the happy startup canvas to help you lay some foundations for your company.

3) Test ideas and experiment with different business models

Boldly go where no one has gone before. There are hundreds of challenges yet to solve and you have the exciting opportunity to create a business around your purpose. It’s just a matter of testing different ideas and creating some ‘planned serendipity’. By exploring different business models and niches around some key constraints (your passion, purpose and values), we firmly believe you’ll make your own luck (for more information read up on effectuation).

If you’ve read this and you’re one of those 460,000 startups founded in the UK last year (or are looking to break out on your own in 2013), remember you’re in the driving seat. Take control of your life and help give business a better name.

Happy startups means a happier world – something we all believe in.

Hope you enjoyed this post. I’m looking for 100 committed, purpose-driven entrepreneurs for a 4 week mission. If this sounds like you, read on…
Introducing the Happy Startup Home School