There are business owners today who like to go it alone, who like to rely on only themselves for the success or failure of the business, who like to venture off as a solopreneur.
Being a solopreneur is a venture made easier today than ever before, through the use of technology and the fact that so many other people are engaged in the same type of business practice.
But what is a solopreneur? These people have the same drive and spirit as an entrepreneur, and they assume a similar risk in building their business. Indeed, it’s very easy to get a solopreneur confused with an entrepreneur.
In essence, they are the same in terms of who they are. What separates one from the other is not what makes them up deep down inside, or what drives them, but how they go about executing their business plan.
Let’s take a look at some of the key differences between a solopreneur and an entrepreneur.
Entrepreneur and Solopreneur: 10 Key Differences
1. Entrepreneurs hire employees. Solopreneurs use contractors.
Solopreneurs don’t go about their business completely on their own. They do work with other people to build their business. But how they go about doing it is what separates them from entrepreneurs.
When entrepreneurs need help, they hire full- and part-time employees. These people become part of the staff of the business, handling any number of duties that the entrepreneur can’t handle on their own.
When solopreneurs need help, they opt instead to hire contractors or freelancers. These contractors may have similar responsibilities to the entrepreneur’s employees – handling IT, HR, billing, etc. – but they won’t be on staff and paid through payroll. On the contrary, they will be paid a contracted rate to handle a specific project or duty, leaving the solopreneur as the only member of the business.
Learn in detail the difference between contractor and employee.
2. Entrepreneurs hop around. Solopreneurs have a singular focus.
What makes an entrepreneur an entrepreneur is their desire to jump on opportunities when they arise. Many entrepreneurs will start one business, sell it and pursue another opportunity when one comes along.
Solopreneurs, meanwhile, tend to be focused on their one business for their entire lifetime. They are less likely to start a business with the intent to eventually sell it for a big profit to a bigger company. Instead, they look to grow a business over time, use it to fund their lifestyle and then either pass it on or close up shop.
3. Entrepreneurs are the face of the company. Solopreneurs are worker bees.
Many entrepreneurs are great salespeople and great networkers. So, while they may have had a wonderful idea for a business venture, and got the business off the ground, their largest value often lies in their ability to make connections and deals.
As such, many entrepreneurs will start a business and then hire the right people to run the business while they’re out closing deals. They are great sellers and marketers and serve as the face of the business.
Solopreneurs are often solid networkers and salespeople, too, but they tend to prefer to do the work the business entails. While they understand the importance of networking and marketing, they often feel more comfortable doing the work than spreading the word about the business.
4. Entrepreneurs manage people. Solopreneurs manage workflow.
This is a big personality differentiator. Entrepreneurs are great at hiring the right people and motivating these people to get a job done. They are like the captain of a sports team, rallying the troops to achieve a common goal.
Solopreneurs are good managers, too, but their specialty is in managing the workflow of projects. While they certainly have the ability to manage people, it’s not their main strength. Instead, they do really well at understanding what it takes to succeed – from every angle – and then doing it all themselves.
5. Entrepreneurs delegate. Solopreneurs roll their sleeves up.
When a need arises, the first instinct of most entrepreneurs is to delegate tasks to the right people to get the job done. It’s not as if entrepreneurs don’t do any work themselves. On the contrary, most entrepreneurs start their business by doing everything themselves. It’s just that, over time, they transition into the position of leading a team instead of handling everything on their own.
When a need arises with solopreneurs, they tend to handle everything on their own. They know what the need is, they know how to handle it, and they roll their sleeves up and get the job done through hard work.
6. Entrepreneurs have an office. Solopreneurs work usually at home.
Entrepreneurs find themselves working mainly in an office setting, surrounded by a team of employees. They have a private office in their space, and there is a conference room that hosts current and potential clients, as well as brainstorming sessions among the team.
Solopreneurs, meanwhile, can also work from home. While they have many clients, they don’t often have the need to host these clients. And because they work alone, they don’t have a need to spend money on office space.
7. Entrepreneurs crave growth. Solopreneurs crave stability.
Entrepreneurs are always looking for the next biggest thing. They are always looking to build more and more value in their business. To that end, they are constantly striving to build their startup into a more powerful business, to create long-lasting and impressive growth.
Solopreneurs are more focused on building something sustainable. Since they only have themselves to rely on, it’s more difficult for solopreneurs to scale up. They are more focused on building a stable set of income and building a business in which they can handle all the work.
8. Entrepreneurs share the fruits of their labor. Solopreneurs keep it all.
Because entrepreneurs will hire employees, and maybe even have business partners and/or investors, they will often be forced to share the profits of the company. They may have other shareholders to share dividends with when the company does well. They may be forced to pay bonuses to employees. They may even have another co-owner they must share profits with if they sell the business.
Because solopreneurs do it alone, they reap all the benefits of their hard work. All the profits the business generates are the solopreneur’s to keep. They have no one they must share it with since they are the sole owner and operator.
9. Entrepreneurs share decision-making responsibilities. Solopreneurs decide on their own.
While entrepreneurs may ultimately have the final say, they often must share decision-making responsibilities with others in the company. Again, entrepreneurs may have shareholders or co-owners to answer to, or at least advise with when a decision needs to be made.
Solopreneurs, on the other hand, make all decisions by themselves. While they may rely on other people for advice, ultimately, every decision rests in their hands alone.
10. Entrepreneurs make a transition from a startup. Solopreneurs keep the same working mindset.
At the outset of most startups, both entrepreneurs and solopreneurs think and act alike. Both must shoulder just about all of the work at first to build their business from the ground up.
What differentiates the two is what happens when the business has built enough capital and gets bigger. When this happens for entrepreneurs, they turn to the outside to bring someone on their team. When this happens for solopreneurs, they re-arrange their workflow so they can handle it themselves – opting for contracted help when need be.
So, Are You an Entrepreneur or a Solopreneur?
Want to know whether you are an entrepreneur or solopreneur? Take this fun quiz to see what you are.
1.) Which best describes you?
A. You don’t mind sharing profits
B. You want to keep all profits to yourself
2.) Would you rather…
A. Keep most, if not all, of your business work in-house?
B. Outsource and automate processes when you can’t handle them?
3.) Your goal in business is to…
A. Build value and then sell it
B. Keep at it until retirement
4.) Which best describes your schedule?
A. You work a relatively normal 9-5 shift
B. You work at various hours on various days
5.) You are more comfortable…
A. Marketing and selling
B. Accomplishing tasks
6.) When change happens…
A. You seek the advice of others
B. Pivot quickly
7.) You are better at:
A. Managing people
B. Managing processes
8.) You are mainly focused…
A. On building the business for your lifestyle
B. On building a lifestyle around the business
9.) Would you describe yourself as…
A. Well-rounded in business?
B. A specialist?
10.) You have dreams of:
A. A big payday
B. A stable income
If you answered more A than B, you are an entrepreneur. If you answered more B than A, then you like flying solo!
Ready to be a solopreneurs? Check out these tips for intrepis solopreneurs like you.