If you ask the question What makes a successful startup? you’ll get a plethora of different answers: from a product-market fit, through having a suitable business model, to finding business-savvy mentors. Ask ten people, and you’ll get ten more or less different sets of success factors. Our guess is, though, one answer will keep reappearing: building the startup with the right people, which often equals finding a reliable and knowledgeable co-founder.
Does this mean that a successful solo founder is an oxymoron? And even if that’s not the case, will you be able to rise to all the challenges of solopreneurship? These are some of the questions we’d try to answer in this article. Let us take you on the one-person startup ride!
Is solopreneurship a thing?
Let’s start with a couple of statistics:
- as of 2021, over 51 million are independent workers, and 17 million of them work full time (MBO partners);
- 68% of full-time independent workers feel that working independently is more secure than having a traditional job, and 77% are delighted with the choice they made (MBO partners);
- among the CrunchBase-featured startups that have raised more than $10 million from investors in 2016, almost 50% were run by a solo founder (Tech Crunch).
- over half of the CrunchBase-featured startups with an exit did so with just a single founder, and the average was 1.72 founders (Tech Crunch).
Since every startup is different, let’s look at a few that succeeded with a single founder leading them.
Successful solo founders and their businesses
Some of the well-renowned startup founders who started their entrepreneurial journey alone include:
- Jan Koum, the founder of arguably the most popular messaging service: WhatsApp
Born in Ukraine, Jan began learning about computers soon after his family moved to California. He enrolled in San Jose State University and simultaneously worked at Ernst & Young as a security tester. In 1997, Jan’s decade-long journey at Yahoo started. Soon after buying his fast smartphone, the entrepreneur-to-be saw great potential in instant messaging, which prompted him to launch Whatsapp. By 2014, the application had become vastly popular with 500+ million users and was bought by Facebook for almost $22 billion. The rest is history.
- David Karp who took what’s best in Twitter, YouTube, and WordPress and gave us Tumblr
Ever since he was a child, David has been into technology. At 11, he started learning HTML and created his first websites, while three years later, he became an intern for animation producer Fred Seibert. In 2006, Karp started his own software consultancy company, and a year later, Tumblr was born. Within two weeks from the launch, the platform gained 75,000 registered users and became a microblogging sensation.
In March 2013, Tumblr was acquired by Yahoo! for over $1.1 billion cash. Although nowadays it’s much less popular than in the 2010s and Karp is no longer the CEO, we shouldn’t forget that in 2019, there were over 470 million accounts on the platform.
- Whitney Wolfe Herd who revolutionized the dating game with Bumble
Whitney went to Southern Methodist University, where she majored in international studies. After graduating in 2011, she started working for Cardify, an app that gave the users the possibility to swipe through retail loyalty cards. Although the project was abandoned a year later, some of its employees went on to work on Tinder. Being one of them, Wolfe Herd became Tinder’s vice president of marketing.
This endeavor didn’t last long, though. In 2014, Whitney resigned due to the growing tension and filed a sexual harassment lawsuit. All that led to her launching Bumble, a female-focused dating app. As of 2020, it hit 100 million users, and at the beginning of 2021, Bumble topped $13 billion in valuation, making Whitney Wolfe Herd one of the leading female entrepreneurs in the tech startup space.
Benefits of solopreneurship
As you can see, the dogma that having not one but two or more co-founders is crucial for a startup’s success doesn’t always hold. On top of that, starting and running an innovative business on your own has some undeniable benefits, such as:
Freedom and the ability to make decisions independently are two of the most often cited benefits of being a solo founder. Here’s what one of our clients who launched a med school prep platform (you can read the full interview below) has to say about it:
I love the freedom that comes with solo entrepreneurship. You can choose your own deadlines, and there is no pressure to do anything you are uncomfortable with. You make all the decisions, from the overall vision to the day-to-day running. For example, I want to provide free platform access to 100 students each year who are economically weaker, and I don’t need to take anyone’s permission for it.
Keeping 100% equity
Who doesn’t want to keep 100% equity, right? That’s a luxury solo founders often enjoy. If you’re one of them, you get to keep all the profits and enjoy flexibility in decision-making that comes with full accountability for your actions. Also, as there are no other shareholders, it’s unlikely you’ll face a shareholder lawsuit.
No co-founder drama
Speaking of lawsuits, being a solo founder allows you to avoid co-founder conflicts. In some cases, disputes can be productive. To quote Garry Tan,
Successful co-founders actually embrace conflict and are constantly in the process of resolving it. If you can’t argue and arrive at the best solution, you’re not doing the work to actually have a real, healthy working relationship.
Sometimes, however, the disagreement can be taken to an extreme. A good example of such a scenario is that of Snapchat. Long story short, in 2013, Reggie Brown, a classmate, friend, and a co-worker of Snapchat’s co-founders accused them of stealing his idea and pushing him out of the company without any compensation. The case ended up with a settlement, but it’s not something you’d like to go through, is it?
Challenges of being a solo founder and how to respond to them
Once you become familiar with all the benefits of solopreneurship, you might be tempted to start fulfilling your dreams of establishing a one-person startup immediately. Not so fast, though. As is often the case in business, all that glitters is no gold, and being a solo founder has its drawbacks. Let’s take a look at what they are and how you may approach these problems.
If you decided to launch a startup, you’re most likely an expert in your field, which may be either business or tech-oriented. Working with startup clients, we’ve met many entrepreneurs-to-be who knew the industry and their target audience inside-out but lacked the skills to develop the product they had in mind. And there’s nothing wrong with that; after all, the old saying goes Jack of all trades, master of none.
If that’s also your story and you’re a business-oriented founder, you can approach this problem in the following ways:
- Hire internally, which is an expensive, hard, and enduring process. Also, if you’re a non-technical solo founder, the first step you’d want to take is to hire a technical consultant or find a technical co-founder who can make hiring decisions. But since we’re talking about solopreneurship here, that may not be the most exciting vision.
- Freelance, which is generally more cost-effective and can provide good results in the short run, but for complex and mature products it may not fit the bill.
- Outsource product development to a software company. One of the most effective ways to build a new product when you’re a solo founder is to outsource development to an experienced and skilled IT team. The key benefit of such collaboration is cost-saving, as you don’t bear the cost associated with recruitment, employee training, and retention. Other benefits include quick access to a qualified full-stack team of engineers and designers and, most importantly, you staying focused on your core business.
Related to the skill gap is the fact that as a solo founder, you may have difficulty seeing problems problem from another angle or brainstorming alternatives. This can result in making bad – or at least not the best-thought-out – decisions more often or having regrets about not making a different choice. Moreover, at the end of the day, the weight of all these decisions can simply become too heavy for an individual.
In this scenario, we advise looking for mentors able to support you with their expertise and experience. These can be independent advisors or investors who provide not only money but also know-how.
Another challenge solo founders face is, you guessed it, money. Unless you have friends and family to support your early vision or you’ve won a lottery, not having enough capital for the MVP can be a deal-breaker. Sure, there are many ways to get funding, but these are not exactly a piece of cake either.
For instance, angel investors could demand high equity for only a nominal amount of cash; even worse, they wouldn’t care much about the product's vision and future roadmap. Moreover, some VCs are reluctant to back one-person companies. For example, Paul Graham of Y Combinator claimed that having one founder only is the number one reason for startup failure:
Have you ever noticed how few successful startups were founded by just one person? Even companies you think of as having one founder, like Oracle, usually turn out to have more. It seems unlikely this is a coincidence.
Seed funding comes with its own challenges. The biggest one right now is that having a business plan with a fancy presentation to vow the investors is just not enough. They expect a lot more! Investors these days want to see tangibles, get the taste of the product, know how successful it is believed to be in a given country, what potential users think of the product, and more.
The most effective solution seems to pair the pitch deck with a prototype. While it may be challenging for a solo founder like yourself, once again, you can count on the help of the tech partner. At Merixstudio, for example, we came up with a full starter pack for early-stage founders that goes by the name of startup DNA.
Solopreneurship case study: an interview with EdTech startup solo founder
To back up our words about solopreneurship being both demanding and rewarding, we’ve conducted an interview with one of our clients, who’s a solo founder of an online entrance exam preparation platform. Being a doctor by profession, he saw a gap in the market for a well-curated exam prep platform for medicine undergrads in India. Here’s what he told us about his journey and struggles in founding the company.
When and how did you come up with your business idea?
I had the first “aha” moment in 2019. However, I chose not to pursue this idea immediately since I was in the final year of med school at the time and had a lot of important exams coming up in 2019 and 2020.
The idea for an educational platform hit me when I was thinking about developing a second source of income and looking for things I am both good at and passionate about. The natural choice was teaching, and I knew the private tutoring market for the medical entrance exam is massive. That's how I decided to build a course for the medical entrance exam.
What challenges did you face early on?
Since I had no business or tech background, it was challenging for me to figure out how to execute the technical aspects of the idea. I spent months learning about finances, marketing, video editing, and exploring web development options.
What made you pursue the idea further and make it into the development phase?
I believed that having finished med school and being a top performer in the exam myself, I can provide a great learning experience to others. Many students have approached me through the years for study advice. I also knew that formal training is not everything. Currently, most biology tutors for the med entrance exam are Bachelors in Science and not doctors. They have not taken the Entrance Exam for Undergraduate Med school in India themselves. Together, these reasons gave me enough confidence that the idea does have the potential for success.
Did being a solo founder mean trouble getting your business idea and startup funded?
Not necessarily. I was lucky because when I pitched the idea to my parents, they loved it and agreed to fund the startup.
As a solo founder, what sort of support do you get and from whom?
The biggest support I received, apart from my parents, was from my teacher, who helped me ace the exam back in 2014. I maintained very good relations with her through all these years. She is one of the biggest names in coaching for the med entrance exam in my city, and when I explained the idea to her, she was incredibly supportive and offered to help me secure first subscribers.
How do you manage most things on your own?
By constantly learning about new things and having good time management.
What prompted you to look for outside help for design and development?
I do not have any background in web design and development.
Why didn't you go for a partnership with someone?
I felt the soul of the idea and all the marketing is based on the content, that is, the high quality of question bank and video lectures, which I can create myself. I simply needed someone to help with one-time web design and development, so I chose to hire a web development company for that.
How to increase your chances of success? Did you verify your idea? If yes, how?
I have thought of some marketing strategies to boost the business. My teacher helping out certainly increased the chances of success. I could not objectively verify the idea, though, because whether someone likes my teaching or not is subjective, and even if 1% of all students subscribe to my platform, it is still highly profitable for me.
What benefits of solopreneurship do you enjoy the most?
I love the freedom that comes with solo entrepreneurship. You can choose your own deadlines, and there is no pressure to do anything you are not comfortable with. You make all the decisions, from the overall vision to the day-to-day running. For example, I want to provide free platform access to 100 students each year who are economically weaker, and I don’t need to take anyone’s permission for it.
To be or not to be a solo founder?
Unfortunately, we can’t give you a straight answer to this question. Successful companies like Ford, Dropbox, eBay, or Amazon were all created by solopreneurs, but it doesn’t guarantee that every single founder will triumph. The key is to be aware of all pros and cons of solopreneurship and decide if that’s the suitable business model for your startup.
Looking for a tech partner to launch your one-person startup? See what we can do for you and get in touch with us!