This publish might comprise affiliate hyperlinks. See our affiliate disclosure for extra.
For a very long time, I thought-about myself to be a solopreneur.
And for those who’re like me, the one time your job title really issues is when somebody inevitably asks: “so, what do you do for work?”
Whereas what you name your self as a solopreneur or an entrepreneur isn’t actually a giant deal, it’s vital to notice that every takes a really totally different path in enterprise.
So on this article, I’ll cowl a few of the greatest variations between a solopreneur and an entrepreneur so that you could be assured in the place your online business is headed.
Solopreneur vs. Entrepreneur
What’s the distinction between a solopreneur and an entrepreneur?
A solopreneur typically works alone, handles all facets of their enterprise, and usually prefers a smaller scale, whereas an entrepreneur builds and manages groups, takes dangers, and goals for scalability and progress.
Right here’s a breakdown of the most important variations between solopreneurs and entrepreneurs:
1. Group Dimension
As evidenced by their identify, “solo”—preneurs usually work alone. Whereas they could accomplice with different freelancers, they don’t have anybody else on payroll or rent any full-time staff.
This implies a solopreneurs “workforce” measurement is most frequently “1.”
However Paul Jarvis (writer of Firm Of One: Why Staying Small Is the Subsequent Huge Factor for Enterprise) explains simply since you’re a “firm of 1” doesn’t imply it’s a must to work alone.
“A Firm of One will not be anti-growth, or anti-revenue, and it’s not only a one-person enterprise both (though it actually could be). … In case you are an organization of 1, your mind-set is to construct your online business round your life, not the opposite manner round.”
2. Determination-making
While you select to be a solopreneur, you need to anticipate to make all main selections your self. Conversely, entrepreneurs typically contain their groups in decision-making processes.
As with all the pieces on this record, nevertheless, solopreneurs might select to seek the advice of with subcontractors or mentors earlier than making massive selections of their firm.
3. Scale
Entrepreneurs are likely to deal with scaling their enterprise, whereas solopreneurs might want to maintain their operations small and manageable.
Very often, solopreneurs’ companies depend on their very own skills and expertise to maneuver the enterprise ahead.
There are all the time exceptions to this rule, nevertheless as many freelancers (who begin as solopreneurs) determine to scale their freelancing into an company mannequin as a substitute.
Usually, nevertheless, solopreneurs are usually happy with out huge scale or insane progress in any respect prices.
4. Threat Tolerance
Entrepreneurs are usually extra keen to take dangers, whereas solopreneurs might want a extra conservative strategy.
This typically means solopreneurs are slower to spend cash, tackle debt, or search exterior investments.
They might additionally select to develop far more slowly than conventional entrepreneurs.
5. Roles and Obligations
While you run your online business as a solopreneur, you ARE your online business.
Which implies you deal with all facets of your online business from gross sales to consumer work and all the pieces in between. They may additionally select to outsource duties to others as a substitute of hiring a workforce.
However, entrepreneurs delegate duties and tasks to their workforce members to allow them to deal with duties solely firm founders or CEOs can do effectively.
6. Income Channels
Entrepreneurs typically deal with introducing new services or products, whereas solopreneurs might think about refining their current choices.
For instance, for those who’re a freelancing solopreneur, chances are you’ll select to get higher at your craft, enhance your charges, or discover increased high quality shoppers as a substitute of making an entire new income stream.
Entrepreneurs are likely to take pleasure in spinning up one gross sales channel, hiring till it’s well-established, after which transferring on to the following channel.
7. Networking
Should you want to work alone then solopreneurship could also be the best choice for you. Whereas not all solopreneurs want isolation, many take pleasure in merely engaged on initiatives and rising their enterprise with out a lot exterior affect.
Conversely, most entrepreneurs deal with constructing their community after which leveraging these relationships to develop their enterprise.
8. Capital Funding
Solopreneurs usually begin and develop their companies with out exterior investments—both from banks or different traders.
As an alternative, they bootstrap their enterprise through the use of their very own funds and reinvesting revenue into the enterprise.
If the added stress entrepreneurs typically face from reporting again to traders doesn’t attraction to you, then solopreneurship is an efficient path.
9. Enterprise Construction
Should you’re a solopreneur, you’ll be able to simply function as a Sole Proprietor. In most nations, because of this you and your online business are the identical authorized entity.
Whereas this may be useful in some methods, it might additionally expose you as a solopreneur to increased taxes and potential legal responsibility for those who face monetary hassle in your online business.
Even for those who plan to remain a solopreneur, think about changing your sole proprietorship into an LLC which might prevent hundreds in taxes and cut back your legal responsibility threat for those who incur debt or fall into authorized hassle.
10. Time Dedication
Should you worth time over cash, then you have to be a solopreneur.
That’s as a result of solopreneurs often have extra flexibility in managing their very own time, whereas entrepreneurs typically work lengthy hours to drive their ventures ahead.
This isn’t all the time the case, nevertheless, some solopreneurs discover they’ve created one other job for themselves and find yourself working even longer hours than they may at a conventional day job.
The higher path is to construct in automations and passive earnings that proceed to generate enterprise and income for you even if you’re not essentially “on the clock.”
11. Talent Units
Should you’ve all the time been thought-about a “jack-of-all-trades” you then’re in all probability a fantastic match for solopreneurship.
That’s as a result of solopreneurs—as talked about earlier than—usually deal with all facets of their enterprise.
So, not solely do it’s a must to be proficient in your discipline (net design, writing, translation, and many others), you even have to know how you can steadiness books, pay taxes, ship invoices, market your companies and much extra.
Usually, entrepreneurs rent for these sorts of duties.
12. Advertising and marketing Method
Entrepreneurs typically deal with constructing a model and implementing strategic advertising campaigns. These campaigns can value some huge cash and require many professionals to execute correctly.
In the meantime, solopreneurs might rely extra on word-of-mouth referrals and different extra natural methods of getting shoppers or clients.
Nonetheless, one of many greatest points we hear about when teaching freelancers on our podcast is how unpredictable phrase of mouth advertising could be.
As an alternative, we suggest you strive a few of the techniques talked about within the podcast to fill your consumer pipeline.
13. Exit Technique
As a solopreneur, chances are you’ll not have any type of exit technique (a plan to promote the enterprise or go public).
Entrepreneurs usually have an exit technique in place whereas solopreneurs are content material to run their enterprise so long as wanted after which both shut doorways, move the enterprise on to another person, or promote for a modest quantity.
So are you a solopreneur or an entrepreneur?
After reviewing all of those variations, ask your self:
Do I need to be a solopreneur or an entrepreneur?
Do you need to work primarily by yourself, funding your individual small enterprise and rising organically?
Or do you need to work primarily with a big workforce, counting on traders, and scaling extra shortly?
The selection is yours.
And the excellent news is that this: you’ll be able to combine and match any of the traits I’ve coated at present.
Simply because this text says a solopreneur does one factor and an entrepreneur does one other doesn’t imply you’ll be able to’t change issues up.
That is your online business. The aim is to make you content. And make you cash.
So long as you’re doing each of these issues, I don’t know if it actually issues what your online business card title says.
Preserve the dialog going…
Over 10,000 of us are having day by day conversations over in our free Fb group and we might like to see you there. Be part of us!