Being struck by a genius idea for a product, starting your own company around it and making mad cash—that’s the American dream, right?
No boss to answer to, no rigid work hours, no co-owner to split the profits with—most people would say that sounds pretty great. However, the reality is that launching and running a successful business all by yourself is incredibly difficult. In the natural products industry especially, it also may be impractical, even impossible.
“We have a mythology around entrepreneurship in our country right now—that it’s super cool and sexy—and that an entrepreneur is just someone being smart and developing something in their garage and then taking it big,” says Tera Johnson, director of the Food Finance Institute, founder of Tera’s Whey and host of the Edible-Alpha podcast. “The truth is that businesses are never one person; they are always multiple people.”
That said, in very early stages of establishing a natural products business, it may be possible to fly solo, at least officially. You might have friends, family and other generous actors behind the scenes but still only one official founder (you) and no paid employees. But even if your company does get off the ground this way, once it finds success and garners growth potential, good luck flying solo.
“If you really want to build a business, you’ll need to build a team,” Johnson says. “And in my experience working with startups, teams need to be in place way faster than people realize. You can’t do everything yourself, and for a food business to grow, the demands are pretty substantial.”
Even investors, who like to see efficient operations when vetting potential opportunities, understand this reality. “From an investor perspective, it used to be a necessity [for companies] to stay super lean for much longer, but now that constraint is much looser,” says Robert Brown, managing director of Encore Consumer Capital. “You want to be efficient with your dollars whenever we come in, but you can build a bigger team sooner. You can’t get very far by yourself, and I see a lot of people who under-hire in the early days due to economic constraints. That’s fine, but you need to recognize that this could limit you.”
Pros and cons of flying solo
No question, there are many potential perks of being a one-person show: You can follow your own vision without having to consider others’ opinions or compromise where you’d rather not. You can set your own work hours. You can make decisions and act fairly quickly because you don’t have to wait for approval or navigate red tape. You don’t have to split your profits with anyone.
Certainly, these benefits would be awesome, but whether they are actually attainable is another story. Plus, there are myriad downsides to running a business by yourself. Johnson shares some examples:
- Too much work for one person. “When running a business solo, you’ll kill yourself in terms of work,” she says. “There is so much to do and you’ll get to a place where you are the binding constraint on growth, and entrepreneurs get there faster than they think they will.”
- Loneliness. Spending 12 hours straight in your basement making products could drive anyone batty, even if you originally loved creating the item. And making it is only one piece of the whole puzzle. You’ll also need to package your products, ship them, call on retailers, plan and create marketing…the list goes on. Without anybody working alongside you—to talk with, to share frustrations with, to share great news with—life as an entrepreneur can get incredibly lonely.
- Myopia. Besides being lonesome, solo entrepreneurs run the risk of becoming myopic, meaning you’re too close to your business and don’t see the full picture. Without any partners or coworkers to provide reality checks, you could wind up wasting time on weak ideas or heading down dead-end roads. “When doing it all by yourself, you’re kind of in a bubble,” Johnson explains. “There are a lot of communities around food these days, so if you do not have a partner, get involved in peer groups and networking opportunities that can help you [stay grounded].”
- Less-professional image. When retailers or investors are considering whether to work with a startup, seeing that it’s a one-person operation may give them pause. They may not view your operation as professional. “What if there is a problem and they can’t get you on the phone?” Johnson asks. “We all get that in the beginning you may be doing this yourself, but depending on the scale of an entrepreneur’s ambitions, the scale of the team should intensify as well.”
- Greater financial risk. Sure, solo entrepreneurs keep more of the profits, but they also assume the entirety of the risk. If the business fails—which they very often do—you’ll be the one footing the whole bill.
Of course, every situation is different, and whether to go into business solo or recruit a cofounder and/or a team is your call. Just be sure to think through all of the positives and negatives—and be realistic about them—before committing to one path or the other.