- 1 Book Summary - Company of One: Why Staying Small Is the Next Big Thing for Business by Paul Jarvis
- 1.1 Key Insights
- 1.2 Key Points
- 1.2.1 More isn’t always better.
- 1.2.2 A company of one doesn’t just have to be one person.
- 1.2.3 Done well, a company of one is efficient and offers simplicity and autonomy.
- 1.2.4 Focus on profitability by starting small and launching quickly.
- 1.2.5 Take advantage of what makes a company of one competitive.
- 1.2.6 You have to motivate yourself and hold yourself accountable.
- 1.2.7 Learn to say no.
- 1.2.8 Use networks to generate business and funding.
- 1.2.9 A company of one is not as risky as it may appear.
- 1.2.10 Communicate with customers to share your purpose and understand their experience.
- 1.3 The Main Take-away
- 1.4 About the Author
Book Summary - Company of One: Why Staying Small Is the Next Big Thing for Business by Paul Jarvis
Most people who start a company are thinking about how they can make it bigger. Success is determined by having more of everything. You want more employees, more customers, more office space, and (of course) more profit.
Company of One challenges the push to have more, cautioning against the higher costs and lower control that come with growth. If you keep your business small, you are more agile. You also have more autonomy over your day inside and outside of work.
If you’re interested in being a company of one, you have to distinguish it from a freelance career. While both have the freedom to decide how much to work, a freelancer doesn’t get paid unless they work. A company will be able to make money even when you’re not working.
More isn’t always better.
The focus of a company of one is not growth. Many organizations have their sights set on becoming large operations. That means hiring more staff to cover marketing, accounting, legal, human resources, and more. These organizations will put more money into real estate for offices and technology to have cutting-edge tools and systems.
A company of one takes a different approach. You purposefully start small and scale very carefully. When there are issues, you don’t believe that putting “more” into the problem is necessarily the solution. Instead, you use the autonomy that comes with being a lean operation to your advantage.
A company of one doesn’t just have to be one person.
It may feel like a misnomer, but the principles of a company of one aren’t limited to a single-person business. It is about the mindset more than the actual organizational structure. This means that you can be a company of one even if you work at a large organization.
Questioning whether or not growth is the solution is the key to being a “company of one.” As a company that just has you or a small number of employees, you keep the organization from growing unnecessarily even if that means not taking on additional clients. If you’re a company of one within a large organization, you also question growth and keep your part of the operation lean.
Done well, a company of one is efficient and offers simplicity and autonomy.
When there’s just you at the company, you have to be good at what you do. There’s no safety net or a team of people to pick up the slack. If you’re going to set out to be a company of one, it is helpful if you have experience in traditional companies building your skills.
For example, a digital strategist works for five years with an agency before hanging out her shingle. She is an expert in what she does, but she has also discovered how she works best. This includes the time of day that is best for her to do the actual work and when she can do other things like taking meetings.
Understanding how you work best and operating around that is a benefit of the operation of a company of one. You can set up the company to function around you. This means that you’re more efficient at getting good work done. Which will make you more competitive with clients.
Being small also helps with agility. You don’t have a complicated organization or a lot of bureaucracy that gets in the way. So, if a customer needs something, you can pivot quickly to meet their needs. The ability to shift priorities and the autonomy to make decisions are at the core of why a company of one works well.
Focus on profitability by starting small and launching quickly.
If you are considering setting out on your own with a company of one, the goal is to set up a lean operation that you can launch quickly. The longer you allow an idea to languish, the longer you are missing out on potential revenue. And you want to start small to keep your costs low and offer a better opportunity to reach profitability sooner.
To keep profitability at the forefront, a company of one must define its minimum viable profit (MVP). This figure tells you at what threshold you will become profitable. What do you need to do to achieve this minimum profitability? Keep expenses as low as possible to get to that figure quicker.
A traditional company believes profitability will follow after growth. So, rather than prioritizing growth, these companies will invest in people and technology at the start. The idea is that they will eventually reach profitability, but they’re focused on setting up the large-scale operation first.
Remember that so many companies didn’t start out with a groundbreaking idea. They just offered a simple solution to a problem people had or took something that existed and tried to make it better. Keeping it small and simple is a good way to start. You can always expand your offerings later.
Take advantage of what makes a company of one competitive.
If you want to thrive as a company of one, you have to exploit the qualities that make you unique. You’re more likely to interact directly with the clients. Provide a personal touch such as a thank you note written by hand. It’s something that you can offer that the CEO of a big company probably doesn’t.
You also have the ability to solve problems in whatever manner you think is best. A non-traditional or creative idea is perfectly fine. If you think that’s the best solution, you can run with it because there’s no approval chain to worry about in a company of one. Even as a company of one inside of a bigger organization, you can approach problems by thinking about how to address them without resorting to pouring more resources into it.
You have to motivate yourself and hold yourself accountable.
Not having a boss can be great, but if you can’t make yourself work you’re going to be in trouble. Only self-motivated people can cut it at a company of one.
Figure out how to optimize your productivity. Set up a workspace that allows you to focus and doesn’t welcome distractions. Studies also show that your ability to focus starts decreasing after working 55 hours in a week. That and other factors that affect your personal productivity should be taken into account.
A personal productivity audit can also help you work more efficiently. Once or twice a year, you figure out how long each of your tasks takes you. Write them down, see what’s taking up your time without providing as much value, and automate what you can. Identifying wasted time allows you to correct and work smarter.
Learn to say no.
The beauty of a small company is the control you have. This means setting your own hours and workload. Rather than overstretch yourself, you have a goal for earnings and just aim to meet that.
In the beginning, you probably will have to take whatever clients come your way. But as you establish yourself, you can be pickier about the projects you want to take on. Companies of one can even be booked well in advance or have large waiting lists.
If you want to balance, you cannot do everything. Set a minimum financial goal and upper limit, aiming for a balance that sits within these parameters. Identify how to get in that range in terms of contracts, customers, or whatever fits your business model. You don’t have to say yes to every project, but you will have to get good at saying no.
Use networks to generate business and funding.
You have networks you can turn to when you’re launching a business. A company of one works well in these settings. For example, if you’re offering writing services, your regular contacts may be able to refer small projects to you. These can grow to bigger projects over time and also lead to word-of-mouth referrals.
A large company wouldn’t be able to thrive by just asking everyone they know to send business their way. Marketing is more of an undertaking in these situations. Like everything else, traditional companies would just throw more resources at it in order to generate business.
Networks are also a good tool for raising capital. If you need money, you’re better off using crowdfunding if possible. You can put out the idea that you have in mind and essentially take preorders while you work on it. You’re collecting money in advance of having a finished product to purchase. You retain all of your ownership interest.
The alternative is venture capital. It can offer fast cash if you get a deal, plus VCs have relationships that can grow your business. But that assumes you want to grow and are willing to give up some of your profit in the exchange. Also, VCs require you to give up some of the autonomy and control that is inherent to the company of one.
Beyond your business goals, demographics can play a role in which of these may work better for you. VCs made up of white males generally support other white males. On the crowdfunding platform Kickstarter, women do nearly one-third better than men.
If you have to seek capital externally, think about your goals and how to best accomplish them.
A company of one is not as risky as it may appear.
You may think that venturing out on your own is a risky move. But if the alternative is to stay at a big company remember that there are risks there too.
Any company, no matter how big, can fail. And the more overhead costs that a company has, the more pressure points they have to deal with if there are financial constraints. Big companies are constantly dealing with ownership changes, layoffs, and bankruptcy. Working for an organization like that has plenty of risks.
Small businesses can do just fine. According to the US Census Bureau, the number of companies of one (self-employed people without employees) that generate at least $1 million in a year is growing. The company of one offers a place for you to be successful without staying in a traditional corporate role.
Your own venture is not without risk, of course. There are a lot of things you have to be able to handle that aren’t the core product or service you’re offering. You need to take care of or outsource marketing, accounting, and sales. Be aware of and plan for those needs to mitigate the risk.
Small businesses can offer a more interesting narrative than a big company. The faceless corporation that has its hands in a little bit of everything is not as compelling as the story you can tell about setting up your company of one from your kitchen table.
You have a purpose and passion for what you do. It may not be your one true passion in life because those don’t always make the best business ideas. But you care about what you’re offering. Find a way to share that message and your personality with your customers.
Communication is a two-way street. You can get valuable feedback from your customers. It’s more than just what they liked or didn’t like about a product. You want to know what made them buy from you over others. Use that information to get more clients.
Build relationships to help build up your business. Research shows that about 83% of new business comes from word-of-mouth referrals. People want to support trustworthy companies. If their friends and families trust you, then they feel they can trust you by proxy.
Connection can’t be faked. Share your unique story, listen to customers, and show that you genuinely want to help them with your product or service. And if customers feel valued, they’ll want to bring you more business.
The Main Take-away
Business doesn’t look the way it used to. You don’t have to have a whole team of people to be running a company. You just need you.
A company of one prioritizes profit over growth. Starting small with a simple idea and launching it as quickly as possible to begin generating revenue is the first step. Products and services can always be expanded later.
Your approach is not to think of what “more” you can add whenever there’s an issue. Instead, you think of creative ways to solve problems. When you need to pivot, you do it without wasting time dealing with hierarchy. With everything your company of one does, you’re able to be nimble without the bureaucracy to deal with.
Of course, there are challenges. Only you can make yourself work, which is critical to your company of one succeeding. The regular company needs like accounting don’t go away just because that’s not your expertise. You have to find ways to meet all the business needs without drowning in additional expenses and more overhead.
But you’re poised to compete well. You have a lean operation. If you can resonate with customers, you’re on your way. Tell people your story and connect with them. Build their trust through great work and listening to their feedback. Then use networks to keep your business growing even if it stays a company of one.
About the Author
Paul Jarvis is a writer and designer with a vast amount of experience in IT and digital media.
His previous work has been consulting with a variety of clients. Corporate clients included Yahoo, Mercedes-Benz, and Microsoft. He also worked with professional athletes to help them navigate their online presence. Big names in this group include Shaquille O’Neal, Warren Sapp, and Steve Nash. After that, he helped online entrepreneurs build their brands.
Jarvis walks the talk of his book as his own company of one. Since venturing out, he’s created online courses reaching more than 10,000 students. He also spends time writing, creating podcasts, and developing software.
He does all this from his home. Jarvis lives with his wife on Vancouver Island off the coast of British Columbia.