In the world of startups, there’s a common bias among investors towards teams of founders. While we can’t speak for every investor out there, it seems the common reason for this perspective comes down to skills; two founders bring twice as much experience and perspective to the table. This is such a pervasive bias that Inc.com was surprised when a study published by NYU and the Wharton School found that, in reality, a single founder has a much better chance of making it than a team. The study looked at over 3,500 businesses and found that, initial challenges in getting funding notwithstanding, the solopreneur is statistically more likely to build a business with staying power.
So, can a single person start a startup? Absolutely. The data puts solo founders in excellent company. To understand why, let’s take a look at the role founders play in establishing thriving businesses.
What is the job of a founder?
A founder’s primary role is to establish the vision for the startup, then put the pieces in place to make that vision a reality. In early days, that can mean wearing many hats. Many founders are de-facto CEOs, but that job isn’t always the same one; HubSpot acknowledges that the title of “founder” can eventually become passive; what makes a founder a CEO is the active work they do in building the business.
In a startup, then, where a solo founder is the CEO, they’re really a lot more than that. Building a profitable business around an idea requires some working knowledge of finance, management, marketing, sales, and operations… It can be a lot. And while many think of tech when they hear the word “startup,” the same is essentially true for founders in any industry; no matter what skills an entrepreneur brings to the table, there are going to be gaps. A team of founders might have one member focused on code and product development with another focused on financials and the business side of things, but that still leaves a lot of expertise that needs to be found somewhere else.
What is a solo founder, then? It’s someone who knows that they don’t want to be the smartest person in the room on every subject. That’s a strength that can make the difference between a successful business and one that goes nowhere.
What business can I do alone?
The short answer is you can do any business alone, if by “do” you mean start. But the long answer is no thriving business can truly be disruptive as a solo act. Tech startup founders become business leaders in a lot of different ways, but what unites them is the desire to change the way something is done for the better. Apps and other tech tools can do that with explosive results when the stars align, but sustainable growth requires a lot of work around understanding the market, adapting to customer needs, developing workable pricing models, and bringing a tech product to market in a way that gets attention.
Maybe that’s why as far back as 2013, Entrepreneur.com published an article titled The Myth of the Successful One-Person Business.
To summarize the article, written by Gene Marks, no business is a one-person business. On one level, there just aren’t enough hours in the day for a solopreneur to make good money doing everything themselves. On another, it’s critical for a startup founder to embrace the notion that they’re going to be hiring help in some form or another, whether it’s through internal hires, vendors, or even SaaS solutions.
In other words: To unlock a startup’s potential, solo founders need the right team in every case.
Solo founders: Get ready for what comes NEXT
If you’re an individual with an idea for a tech startup and you are feeling overwhelmed at this point, you aren’t alone. The prospect of building that winning team of experts around your vision can be daunting if you’re approaching it from zero, but starting a solo business doesn’t mean going it alone.
NEXT Studios is a venture studio dedicated to supporting solo entrepreneurs and teams of founders alike with a proven process to take an idea and turn it into a business. It starts with helping entrepreneurs evaluate their vision—Does it solve a real need? Will people buy it? Can it generate enough revenue to sustain a business?—then gives them the resources they need to grow.
As Indiana’s first Benefits (B) Corporation venture studio, we’re dedicated to fostering the economic development of our state and its visionaries. That means helping solo founders get access to capital, but also to put that capital to work with the right team of experts to wear the many hats a startup needs. We believe in the power of individuals who are serious about changing the world, and it’s our job to help them prepare for whatever comes next.