The Million-Dollar One-Person Business by Elaine Pofeldt
It’s a brave new world for all of us navigating a working life today. As Elaine Pofeldt writes, “The truth is, we don’t know yet what a world of increasingly independent work will mean. We’ve never had as many free agents as we do today.” In the past decade or so of the gig economy, workers with “alternative” work arrangements — freelancers, temps, contractors, and part-timers — have grown to more than 40% of the work force in the United States. This unprecedented change is occurring worldwide in the industrialized nations.
The subtitle of this book says it all — Make great money. Work the Way you Like. Have the Life You Want.
For many of us who are older, our jobs are being taken away sooner than we planned. This book might identify a potentially lucrative ‘side hustle’ to supplement retirement income. It might help you define a business opportunity and design a life that invites in more creativity, freedom and purpose.
Younger people, too, are having difficultly finding work that pays well enough to cover their living experiences and student debt. “Most of today’s free agents have been thrust into running a one-person business without any preparation, “ Pofeldt notes. “Universities have a vested interest in selling the idea that all of their graduates will be working as high-paying, full time employees at well known companies. Outside of entrepreneurship programs, they rarely broach the possibility that students may end up working for themselves nor do they teach skills that will help them thrive in self-employment.”
Pofeldt sees great potential in this new world of work if people learn to master it. Formerly a Senior Editor at Fortune Small Business magazine, she has contributed to Money, CNBC, and Forbes, among other publications. She reports that already in 2015, according to the Census Bureau data, “there were 35,584 ‘nonemployer’ firms— that is, those that do not employ anyone other than the owners— that brought in $1 million – $2,499,999 in annual revenue.”
Many more tiny businesses in that same year were approaching the $1 million mark:
258,148 firms brought in $500,000 to $999,999.
584,586 generated $250,000 to $499,999.
1,861,656 businesses brought in $100,000 to $249,999.
Who knew they were more than two million Americans having this level of financial success on their own in 2015? And their ranks have continued to grow, fueled by the internet enabling access to a global marketplace— one that provides many shortcuts in setting up a business from sourcing, to fulfillment and distribution.
These business owners were are in the enviable position of deciding whether to continue to grow their business and hire more employees, or keep it small. ‘Ultra-lean’ is a phrase Pofeldt uses as a common denominator in these varied enterprises.
What are these businesses? She identifies six categories:
- E-commerce
- Manufacturing
- Informational content creation
- Professional services and creative businesses, such as marketing firms, public speaking businesses, and consultancies
- Personal services firms, offering expertise, such as fitness coaching
- Real estate
What are the identifiers of success — or what do they have in common?
The companies make clever use of outsourcing, automation, or mobile technology to build and grow these businesses. No two are like in their approach and the examples Pofeldt cites are full of insight. Producers of organic honey in California outsource the packing of their honey, allowing them to focus on marketing and growing their business. The founders of Brooklinen, a Brooklyn-based startup selling luxury linens online, relied on freelancers and outsourced workers to keep the overhead low — everything from Facebook marketing to distribution. Then they used Kickstarter to find the additional funding to scale the business to the next level.
Ditch the DYI
“What will help you scale into seven figures is to expand your capacity beyond what one person can do,” she writes. One of the main benefits of outsourcing is that more of your time is your own. That’s more time for contemplating how to grow the business or simply enjoying other aspects of your life.
The importance of nurturing a community:
Pofeldt points out that these million-dollar entrepreneurs don’t thrive in isolation. They recognize the importance of people in building their success, from vendors and freelance talent to clients: “Typically the success of these businesses is based heavily on connecting with customers and who are passionate about what they sell and have the power to get other people excited about purchasing it, too.”
One investor applauded the Brooklinen team’s skill in forming meaningful relationships with their audience: “We were blown away by how they have scaled so efficiently while building a product that is truly loved.”
Pofeldt points out that it takes most of these businesses two to five years to produce viable income, and even then only 51% get their primary income from the business with more than 40% still relying on another job. Once established, however, you are buffered against a major risk of employed workers, especially older ones — getting downsized or laid off. This is a great plus in a working environment shifting as rapidly as ours is today.
When I spoke about this book to a friend, he noted that ‘not everyone is an entrepreneur.’ True enough, but since so many of us are already going down this road, it is valuable to have a strategic and actionable roadmap for success.
I find this book very inspiring as I look to navigate the next five years of my own working life and beyond. I also bought copies of the book for my three step children who are in their thirties and forties and have their own entrepreneurial spirits.
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such a great book title and very good facts.
Thank you, Natasha. Since 40% of the US workforce is now engaged in working independently, or not for a large company, the roadmap this book provides is so important.
Nice summary. I’ve always been an independent cuss, working for myself or leading organizations I have founded and, for all the anxiety that also comes with it, it has made my life free. And I chose my work to fit life needs for the moment. For instance, when my daughter was young, I let go of most of my consulting business because it involved travel–and psychotherapy gave me tremendous control over my time. When my children were grown, I returned to consulting, loving the travel, appreciating the ability to commit myself to large, distant projects. But after a while, I wanted to work much more deliberately to make my values come to life, and I founded an organization to train nonprofit leaders, with equal emphasis on skill and social justice.
Thank you, Barry. I’m in the midst of my own career transition at the moment. It’s new enough I’m not sure where the chips will fall, but this book provided some good insight on creating roles where I’ll have more time to myself, and that’s very welcome!
Such a well written review of the book Mary! I haven’t read the actual book yet but after reading this I am very excited to check it out.
Thank you, Ashley. You and Julio are enterprising enough, you will both find it useful.