Interested in pursuing a business endeavour on your own? Welcome to the fast-paced world of solopreneurship.
Technology has made it considerably easier, albeit from a purely conceptual point of view, to set up your own company and begin operations. The gig economy coupled by the freedom of successfully communicating, conferencing and collaborating from the comfort of your own home has contributed to over 41 million citizens in the United States undertaking some form of self-employment here, or there. This number will only rise as more workers begin to uncover the virtues of working for themselves.
41 million people sounds like a lot, but the chances are that many more people have, at least at some point in recent years, toyed with the idea of going it alone in business.
The very notion of becoming your own boss is filled with potential drawbacks, the implication of hard work, and lots of struggling while you establish your endeavour. But there are also plenty of positives that can be achieved too.
Many solopreneurs use their endeavours to follow their dreams and ultimately exponentially boost their revenue streams. There are plenty of arguments both for and against becoming your own boss, so let’s take a look at a few key positives and negatives either way and explore them in more detail.
The freedom of solopreneurship
The most pertinent point of going it alone is the fact that you’re free to make money and steer your business in any direction that you would like.
Being your own boss means that you can finally make all the decisions that you thought your employers should take in previous roles. If you want to adapt a product to appeal to a new audience base, you can. If you’d rather release a sample version of your software to encourage wider adoption, it’s down to you.
It’s only truly through the route of the sole entrepreneur that this is possible. Even as a senior manager within a company, there would always be people to answer to. While business owners that choose to take on the funding of venture capital firms are typically required to surrender a significant portion of their equity and continually report to shareholders.
In your own company, times can be tight and there’ll no doubt be some instances of bootstrapping on the horizon, but the most beautiful thing of all is that your business will belong to you – and nobody else.
As we touched on in the last point, going it alone and bootstrapping your own startup will mean that you’ll have no worries over outsider influence.
While venture capital is seen as a great way of gaining significant levels of funding early on for a business, many firms would require a share of ownership in return for their investment – which means there will be more interference within the decision-making process of your company.
While other funding strategies have less of an emphasis on relinquishing ownership – ie angel investing and crowdfunding – there’ll still be a level of responsibility that would need to be observed before you make a decision.
Of course, some will suggest that shared ownership can help solo entrepreneurs to call on the advice and support of their peers before making decisions – thus helping them to steer the company in a positive direction. But this invariably depends on the type of business person that you are. If you’re strong-minded and driven by clear visions and insight, having external influences can be damaging to your strategies.
Another positive as far as going it alone in business is concerned stems from the fact that the money being used to operate your business will have been grown from your own bootstrapped funding.
Naturally, it’s great to attain funding from other sources, but external investors will be looking for a return on the money they’ve offered up, and this can cause a high degree of pressure for entrepreneurs.
Managing your own money comes with an element of personal burden, but managing finance that belongs to investors, peers and shareholders can lead to fewer risks being taken on behalf of your company. With a significantly more risk-averse outlook, you could miss out on some great opportunities for your business.
Some influential entrepreneurs can be seen almost fetishising the notion of business owners struggling in their endeavours. While the idea of hustling your way to success is admittedly a noble one, absolutely nobody should be made to suffer both physically and psychologically in an attempt to keep their business afloat.
If your business is struggling financially, and you’re taking on extra jobs to balance the books at the cost of your health – it could be time to either find an extra revenue stream or stop to consider that the venture just isn’t working out at this moment in time.
Remember that committing yourself to your startup is one thing, but doing so at the cost of your relationships with family and friends is a whole different matter entirely. Always dedicate some time, if you’re bootstrapping your business, to assessing not only the health of your business but also that of yourself – and don’t be afraid to ask for help if running your own company is becoming too difficult.
Keeping sickness at bay
The sorry truth about running a company as a solopreneur is that if you take a sick day, so too does your business.
Naturally, if you’ve scaled to the point of taking on a team of staff, then you can expect operations to continue to tick over, but if a business loses its leader, then no important calls will be made until they return.
The issue here is that time equals money, and any time taken off work with an ailment must be considered as money lost.
This drawback is difficult to overcome as a solo entrepreneur. Luckily, if you’re unable to attend the office, it’s possible to interact with clients in some form even if you’re unable to leave your bed, but here it really pays to have somebody on hand to help out and possibly make some critical decisions on your behalf. Possibly, the best remedy for this issue could be found in hiring staff strategically. Aim to recruit a team member experienced and responsible enough to deputise in your absence.
Another key drawback about going it alone in business management stems from the stark possibility that some prospective clients and investors may be unwilling to trust their money going into a new company with a single owner.
Potential collaborators can perceive your business as being in possession of a lack of insight, owing to having a solo entrepreneur at the helm, while others may be fearful of the level of credibility on show.
These drawbacks can be remedied by the strategic partnerships offered up by venture capital firms and angel investors, but they come at a price.
Essentially, life as a solopreneur can be a difficult one. It will inevitably involve encountering more closed doors than if you were to call on external help.
However, it’s worth remembering that if you retain full ownership of your company, and execute a clear vision, the potential rewards in a financial sense alone could make the extra hard work feel worth it.
In many cases, the life of the solo entrepreneur can be whittled down to subjective appeal. If you feel like you can handle the extra stress and financial hardships that will come with it, then take the plunge. If not, it doesn’t mean that you’re any less ambitious or that your business idea won’t work. Simply explore your wider options for funding and announce your business on the world stage with a little help from some external investors.