Is your business a cat or a dog?

I see two types of business - one is founded by a passionate owner who turns a skill or hobby into a job. The other is an entrepreneur who spots an opportunity and decides to go for it. Cats and dogs.

Cat businesses are driven by passion and exist mostly outside the confines of a market opportunity. The owner runs the company whether there is much of a demand or not - this is what they want to do, and they're doing it - a bit like a cat that doesn't pay much attention to garden boundaries.

Dog businesses are bound by market opportunity. These businesses are founded because a need was spotted, and if the opportunity turns out to be a dud, it will quickly close. It's like a dog waiting for its owner to come home and play fetch in the back garden. The space is defined, and the game is intense.

Interestingly, both cat and dog businesses look the same from a distance. They're both relatively small - certainly not corporate elephants. Both are owner-managed, just like cats and dogs have an attachment to someone. Both crave attention.

But look closer, and you realise these businesses couldn't be more different.

A cat business exists despite the opportunity

A cat business exists no matter the environment around it or how well it does. People open cat-type businesses all the time. They love dancing, so they open a dancing studio. They study law, gain experience practising it, enjoy it, and then open their own legal business. Whether there's market demand for the particular offering is secondary. It's an inside-out process of deciding to "do your own thing."

Indeed, these cat businesses are often called "lifestyle" businesses because they are shaped around the owner's life instead of an external opportunity. And yet, many of these cats don't lack ambition and want to grow just as much as the more opportunistically founded ones. Some of the biggest companies on the planet started as cats. It's the typical story of the founder tinkering in their garage.

Cat businesses are patient. They creep up on success. They are often self-funded - or bootstrapped.

With cat businesses, success is secondary to the founder living out their passion and doing what they want to do. Things need to go really bad for a cat business to close down, and even then, it likely will continue on the sidelines while the owner finds a day job. Cat businesses have nine lives!

A dog business exists because of the opportunity

Dog businesses are founded by entrepreneurs. They spot a gap and decide to open something that meets a need. These businesses typically try to grow fast to claim as much of the opportunity before the competition catches up. To drive this growth, they require a heavy cash investment from a (wealthy) founder or through outside investors or loans. A dog business is impatient. They want to become successful quickly. These businesses are often referred to as "startups".

Dog-type businesses depend on the immediate market opportunity for their existence. They run on risk, and the owners will "close shop" if the money doesn't come in quickly. It's profit over passion.

A dog business will bite you if you don't watch out. If an opportunity fails to materialise, it can result in financial ruin for the owner and job losses for employees. These businesses have just one life, either long and prosperous or short and painful.

Cat businesses need a brand

The differences between dog and cat businesses impact the very nature of how they grow.

A cat business is more brand-focused, with the owner's identity underpinning the business image. Growth happens slowly as the brand becomes more well-known and trusted. The owner is typically picky about who they work with, and scaling the offering is tricky. These businesses are the craftsmen and women of the economy and are often focused on services.

When I work with cat businesses, I find it best to help them define their brand more sharply and take a boutique, premium approach. In fact, these businesses are often hurt by their brand because they've underinvested in it despite being so dependent on it. It takes a relatively large upfront investment in graphic design, web development and opinion leadership-type content to make a cat business look credible.

The marketing these businesses should do differs from the promotional type that drives short-term enquiries. Marketing for these businesses should be the slow drip type that gradually builds awareness and reputation.

Dog businesses rely on promotions

Dog businesses are short-term-focused. Their growth depends on hitting the numbers. They want to sell to whoever is willing to buy. These businesses aren't so much brand-driven but growth-obsessed. Marketing activity must be promotionally focused to drive short-term success measures such as inquiries, shopping cart visits, store visits, meetings, demos and product trials.

The ongoing marketing activity for dog-type businesses is more expensive than for cat types, although the initial brand investment can be less. Effective promotional activity must happen continuously and reach the largest possible audience!

When I work with dog businesses, I aim to get ahead of the game quickly. There's a manic urgency to everything. I help these businesses rapidly define or refine purchase funnels, streamline marketing operations and optimise spending.

What type of animal is your business?

I often find confusion among business owners themselves and the suppliers they use, such as agencies, about what type they are dealing with. They try to pat the cat and get scratched or cuddle the dog and get bitten.

Cats require patience

Cats sometimes stray and disappear for days before returning home, and experienced cat owners know this and don't panic. The same is true for cat businesses, which can go for weeks or months without significant new clients before hitting another home run. Patience is crucial.

Cat businesses run on smaller budgets. They have longer sales cycles. The owner wants to be much more involved - this is, after all, their passion project.

Interestingly, and rather counterintuitively, you don't grow a cat business through heavy investment in marketing promotions. It's a brand job, first and foremost.

Dogs demand attention

Dog businesses are on the edge. They want lots of attention. As a supplier, you need to have your finger on the pulse. They are also constantly hungry, so if there isn't a steady stream of quick wins, they get irritated. These businesses are entrepreneurial, fast-paced and require professional management, or they run riot.

Building an effective marketing engine for a dog-type business can be expensive. You typically need a marketer inside the business to manage things and third parties to help develop promotional content, drive digital marketing, and organise lead generation campaigns at scale.

Making peace with my pet

On a personal note, knowing that my business, Firejuice, is a furry cat has helped me better understand the nature of the beast. I've become more patient! I panic less. For example, I've realised that out of every ten birds we try and catch, a few will always fly away or simply be the wrong size for us (or simply not tasty). It's just how it is.

And as a business that works with both cat- and dog-type businesses, we've become more effective as marketing consultants. No longer do we try to pat the cat or cuddle the pit bull.