What Is An Individual Entrepreneur?

What Is An Individual Entrepreneur - Moniedism

However, in the United States, the number of “individual entrepreneurs (solo planners)” who are not entrepreneurs is increasing. As of 2010, the Small Business Administration (SBA) reported that there were 27.9 million small businesses, of which 73.2% were individual entrepreneurs.

According to the latest data in 2019, the number has increased to 30.7 million, and billionaires (net assets of more than US $ 1 billion) are also born.

Differences between entrepreneurs, individual entrepreneurs, and freelancers

Individual entrepreneurs are still entrepreneurs. However, the former means a person who puts all his energy into building a business with a firm belief, such as establishing and operating a business independently (solo) and nurturing one project over a long period of time. In addition, many people do not feel the pain of working alone and rather enjoy the process of success, and even after the business grows and the scale of hiring employees, they demonstrate leadership as an organization organizer. There is a tendency.

On the other hand, the latter tends to form teams and partners from the initial stage and pursue new profit-generating opportunities with a view to selling or acquiring businesses. For this reason, it seems that they often focus on networking, which is the backing of growth, rather than building a business, and focus on the role of manager, such as efficiently allocating work to each person in charge and outsourcing.

As an entrepreneur, we all aim for business success, but the means, purposes, and roles to reach that point are different.

In addition, it seems that there are cases where you start as an individual entrepreneur at first and then shift to an entrepreneur who works as an organization as your business expands.
In terms of sole proprietorship, it tends to be mixed with freelance. However, the big difference is that freelancers receive compensation from clients for their work, and individual entrepreneurs build businesses based on their own funds and money (investment) obtained from funds and generate profits. However, it is common that they work alone as bosses and as employees.

Can you do it while doing a side job? merit and demerit

The reason why the number of individual entrepreneurs is increasing in the United States is that the number of people who "want to try their own potential" and "longing for entrepreneurship" is increasing. In a 2018 survey by printing and marketing services company Vistaprint, 62% of 1,000 people said they would like to start their own business. However, when considering individual entrepreneurship, it is necessary to consider not only the advantages but also the disadvantages.


Since you can start a business with relatively simple procedures (in Japan, just submit a business start notification) and at low cost, you can also start a business as a side business as an opportunity to test your potential. There is no need to share profits, it is easier to file tax returns than corporations, and it is attractive that you can move your business as you like.


Solo activities carry the risk of taking full responsibility for the business on your own. In addition, if there is no track record, the trust of investors and banks is low, and it tends to be difficult to raise funds for business expansion. It is also important to take positive action in search of inspiration for new ideas and network creation that leads to business opportunities and collaboration.

That famous billionaire was also a former individual entrepreneur!

As an individual entrepreneur, you can use your knowledge, experience, and skills to freely develop various businesses depending on your ideas, from accounting to marketing, counselors, web design, or even completely new products and services. Many former individual entrepreneurs have grown to become Forbes billionaireists, taking full advantage of individual entrepreneurs, such as Pierre Omidyar, chairman of eBay, the world's largest internet auction.

Omidyar, who started his career as a freelance programmer, launched a personal auction site in 1995, taking inspiration from the remarks of his lover (current wife) at the time. This is the beginning of eBay. Four years later, it will grow into a huge auction site with a total sales of about US $ 2 billion and more than 2 million users. In 1998, it was listed on the Nasdaq and raised US $ 63 million.

Chairman Omidyar's net worth as of February 26, 2020 is approximately US $ 125 billion. It's a huge success for an individual entrepreneur, ranked 36th in Forbes' billionaire rankings. In addition, Anastasia Soare, the founder of Anastasia Beverly Hills, a purveyor of eyebrows for celebrities around the world, and Sara Blakely, the founder of the shapewear brand Spanx, have made huge fortunes from individual entrepreneurs. I built it.

Can you overcome the barrier of "30-40% of individual entrepreneurs are out of business in a year"?

The success of these billionaires is not the product of good luck or chance. According to SBA estimates, more than 50% of small businesses will suffer financial difficulties within the first year of establishment and 30-36% of individual entrepreneurs will go out of business. Therefore, it is necessary to develop a business that maximizes the merits of individual entrepreneurs by forming innovative ideas that meet the demands of the market.

At the same time, it is presumed that the attitude of continuing to take on challenges without giving in to the disadvantages will bring great success far beyond expectations. If you are interested in starting a business, it might be a good idea to start with a side business for the purpose of increasing your income source.

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