What is a solopreneur?

Business professionals who are self-employed and run their businesses independently, without partners or employees, are sometimes called solo entrepreneurs or solopreneurs. Let’s take a look at the characteristics, benefits and challenges of solopreneurship. 

Solopreneurs start and run businesses entirely on their own, managing every aspect without partners or employees. This approach can be a streamlined version of entrepreneurship thanks to easy-to-use AI tools, speedier decision-making and approval processes (compared to corporations), and flexibility. Solo entrepreneurs may value independence and the ability to shape their work around their personal goals.

Solopreneurs are similar to freelancers in that they both perform services for clients without the help of employees.

The differences are nuanced. For example, the owner/operator of a one-person housekeeping service would not usually be seen as a freelancer, whereas a writer with a stable of clients probably would be. Other differences are:

• Freelancers typically work on a project-by-project basis, offering services to different clients with short-term engagements.
• Solopreneurs are more likely to build a business around a specific service or product, taking a more strategic, long-term approach to running that business.

Solopreneurship is also similar to entrepreneurship, but goals may differ significantly. Entrepreneurs typically aim to grow their businesses by hiring employees, expanding products or services and delegating tasks as operations scale. Growth may be tied to a bigger goal, like building a business that they can eventually sell.

A solopreneur, in contrast, is not necessarily focused on scaling and selling. They may turn a passion or interest, such as pottery or interior decorating, into a reliable revenue stream and prefer to maintain full control over every aspect of their work. Instead of building a team, they often create a steady, sustainable business that supports their personal and professional goals.

One advantage this role can offer is flexibility and work-life balance. Independent business owners often have the ability to set their own schedules, select the clients or projects they want to take on, and structure their work around personal commitments. This level of control can help reduce stress and create a more sustainable balance between professional and personal life. 

Another benefit can be their autonomy to make decisions and steer their business in the direction they want. Without the need to gain approval from stakeholders, they can pivot more quickly when needed, seize new opportunities and adjust their strategies based on the market. This independence also allows them to stay aligned with their values and vision for the business.

Solopreneurship can create opportunities for growth and skill development. Managing every aspect of a business — from marketing to customer service — requires these visionaries to continually expand their knowledge and abilities. While it can be challenging at times, this hands-on experience may lead to a broad, practical skill set that can strengthen their overall business acumen. Many find that their range of new skills allows them to add to their current business offerings.

Sole proprietors, also known as a solo entrepreneur, manage every aspect of their businesses, which can create challenges in time management, client relationships and long-term growth. Identifying these challenges early can help them plan more effectively and, ideally, avoid common pitfalls.

One such pitfall can be burnout. Managing everything on your own, after all, can be a heavy burden. To avoid this outcome, some seek out consultants to help with areas like marketing, accounting or technical support — industries that support a business but aren’t business-specific. 

Balancing multiple projects without feeling overwhelmed can be difficult. Setting clear daily goals, breaking larger projects into smaller tasks and scheduling blocks of work time can improve productivity. Minimizing distractions and using strategies like setting boundaries for meetings with clients — or even family — are also effective ways to protect work hours and maintain momentum.

Maintaining a steady pipeline of work can be another important part of solopreneurship. These independent business owners may benefit from dedicating time each week to networking, following up with past clients or pursuing new leads. Forecasting workloads and planning ahead may help minimize dry spells and ensure consistent income.

Managing finances independently can be a major challenge in solopreneurship. Without employer-provided benefits like paid time off, retirement contributions or health insurance, these professionals must plan ahead to cover day-to-day expenses, long-term needs and even unpaid sick days and vacation time. Establishing an emergency fund is critical to handling periods when business slows or unexpected expenses arise.

Planning for retirement is another consideration. If they choose to save for retirement, independent business owners can’t rely on someone else to offer a program and match their funds. Instead, they have to set up and contribute to their own retirement accounts. Common options are a SEP IRA, Solo 401(k) or traditional IRA.

Finding and choosing health insurance is also a part of financial planning. Without employer-provided health insurance, solo business owners may need to purchase it through private markets or the Health Insurance Marketplace^®. 

Working independently can sometimes lead to feelings of isolation. Without co-workers or regular team interactions, it can be easy to feel disconnected. Building professional networks may be a remedy. Some other practical ways to stay connected include:

• Joining industry associations, local business groups or online communities
• Scheduling regular meetings with peers, either in person or virtually
• Regularly spending some of your working hours in co-working spaces to meet other professionals

In addition to professional groups, personal connections play an important role when working independently. Making time for family and friends can help maintain a strong support system outside of work responsibilities.

Building a network of trusted peers, mentors or advisors not only helps with feeling connected but can also provide valuable perspectives when facing business challenges. Reaching out for advice, sharing ideas and offering support in return can make a meaningful difference in maintaining motivation and emotional well-being.

Starting any business ownership journey  often involves a clear understanding of personal skills and interests. These can inform an assessment of professional strengths and areas of expertise. Reviewing past work experiences, third-party certifications, hobbies and natural talents can also offer insight for identifying business ideas.

It is equally important to evaluate the market demand for these skills. Finding the intersection between what someone enjoys, what they excel at and what potential clients need is critical to developing a niche. Researching the competition and finding gaps in the market can help improve business plans. 

A business plan  can help solo entrepreneurs set a clear direction toward their goals. Even a simple plan may outline essential areas such as services offered, target market and pricing strategies. Common elements of a basic business plan include:

• Mission statement
• Description of services or products
• Market research
• Marketing strategies
• Financial projections

To track progress and adjust strategies, the plan must be reviewed and updated regularly.

Accessing resources can help aspiring entrepreneurs save time, stay organized and potentially grow a business more efficiently. Free and low-cost tools  to assist with tasks such as marketing, communication, project management and networking include:

• Newsletters dedicated to business trends and solopreneurship tips
• Online platforms that offer website templates, productivity apps and free marketing tools
• Networking groups, both virtual and in person, that provide opportunities for collaboration and support