Number of Million-Dollar, One-Person Businesses Doubles In One Year

Mike Brown, a former weapons systems officer in the U.S. Navy, has built a million-dollar, one-man business coaching entrepreneurs on their mindset about money after exiting a previous business that invested in oil and gas and becoming an angel investor.

Brown, the founder of Unbreakable Wealth in Golden, Colo., says one thing that helps him pull it off is multiplyingwhat he can accomplish by using AI, which he views as a kind of “democratized leverage.” He uses Wispr Flow for voice dictation, boosting his writing speed, and Claude AI to assist with the copywriting of his newsletter.

“In my opinion, in the next 18 months we’ll see a billion-dollar, one-person company,” he said in a panel I moderated earlier this month for the New York Public Library (NYPL). “That is the power AI is creating. With no-code platforms like Replit, we can build things that would once take months or years and a massive capital investment— for free. AI is not going to take our jobs. There will always be a human in the loop, but it will be a human leveraging AI, because one person is going to be able to do the job of 40 people. Being proficient with AI will be critical to wealth creation.”

Brown is part of a trend that has suddenly seen an exponential leap in growth–the rise of the million-dollar, one-person business. The number of million-dollar one-person businesses and partnerships in the U.S. has reached an all-time high, essentially doubling from 2021 to 2022 for the first time ever—in what may be an indicator of what’s to come.

There were 116,803 nonemployer businesses reaching $1 million or more in revenue 2022, the most recent year available from the U.S. Census Bureau statistics. That is up from 57,222 in 2021. All three categories of seven-figure businesses have grown:

• 104,525 firms hit $1-2.49 million in annual revenue in 2022. In 2021, 53,460 firms reached $1-2.49 million in annual revenue
• 11,314 businesses reached $2.5 million to $4.99 million in annual revenue in 2022. That is up from 3,593 firms in 2021.
• 965 businesses earned $5 million in annual revenue in 2022; that represents an uptick from 769 businesses in 2021.

“Nonemployer” businesses get their name because they don’t run payroll like employer firms. In most cases, they are one-person operations, but some are partnerships. Often these businesses use automation, outsourcing and contractors, such as a virtual assistants, to get more done.

If the trend keeps accelerating, it could potentially change the balance of power between employers and employees—who will increasingly have the option to earn more on their own than from a traditional full-time job. And given that many of these businesses can be run from anywhere, the trend could also allow more workers, empowered with the option to form a high-revenue business on their own, to push back against “back to the office” mandates.

But that may take a while. Currently, million-dollar one-person businesses and partnerships are still rare. Almost like elite athletes of the one-person business world, they represent less than 1% of all nonemployer businesses.

Most nonemployer firms bring in far less than $1 million. All told, there were 29.8 million nonemployer firms in 2022, up from 28.5 million in 2021. Their average revenue was $57,922 in 2022, compared to $52,739 in 2021. For comparison, the median income for men in the U.S was $66,790 in 2023, versus $55,240 for women.

So what are these seven-figure businesses selling? The government’s nonemployer statistics are organized by North American Industrial Classification System (NAICS) codes, showing their industry but not the specific types of businesses

However, in reporting on them for more than 10 years, I’ve found that they are represented in many industries—e-commerce stores, Airbnb ownership, professional services practices, personal services practices such as nutrition and fitness, content creation, manufacturing (through outsourcing) and many others.

One entrepreneur who is part of the trend is Matt Tesvich, founder of SKUNK SKIN, which sells odor-proof socks he invented while still in college. His business is on track for $1 million in revenue. “The only way to be financially free is to learn how to make money on your own,” said Tesvich, who also spoke on the panel.

Interlocking trends drive exponential growth

A number of trends seem to have contributed to the big increase in million-dollar, one-person businesses in 2022:

Interestingly, there was not as much growth in the categories under $1 million for 2022 as for seven-figure businesses:

• 2.6 million businesses reached $100,000 to $249,000 in annual revenue in 2022, compared to 2.4 million in 2021
• 893,403 businesses reached $250,000 to $499,999 in 2022, compared to 813,564 in 2021
• 402,990 firms hit $500,000 to $999,999 in 2022, versus 362,341 in 2021.

The mindset of million-dollar, one-person business owners

Understanding the mindset of million-dollar, one-person businesses owners and how it differs from the average solopreneur can be helpful, if you want to build a seven-figure business yourself. Here are some tips I gleaned from the NYPL panel, “Master the Money Mindset for Business Success.”

Understand how to get more done with the resources you already have. “The difference in generating wealth for yourself versus being an employee is leverage,” said Brown. “So, if you want to create true wealth, there has to be some sort of leverage point. It doesn’t mean you have to be an entrepreneur, but it is the fastest path to leverage and decoupling your time from money. As an employee, unless you’re at the very highest levels of a Fortune 500 company, your income is going to be capped, and entrepreneurship is really about moving into a place where your income is uncapped, and you can actually divorce your time from money.”

Get clear on how you want to live. Nothing is more motivating than designing a better life for yourself—however you define that. “Money is just a battery,” said Brown. “Money is only important in that it can allow us to create the life that we want to create. And so for me, that mindset starts with getting really clear on ‘What is the life that I actually want to live?’”

For many self-employed people, the dream is about freedom—but that can require an intentional approach. “Entrepreneurship does not guarantee that you’re going to be free,” Brown said. “It just guarantees that you have some sort of leverage, but if you don’t use that money in service of creating that life that you want to create, you’re just as trapped as an employee….And the reality is most of us don’t need as much money as we think to live the life that we want to live. We get trapped in the societal belief that more is better, and what I found with working with hundreds, if not thousands, of entrepreneurs and high earners is that most of us don’t need more money. We actually need more freedom; we need to give ourselves a permission to live life on our own terms.”

Keep your antenna up. Actively trying to come up with a million-dollar, one-person business idea doesn’t always work. Throughout college, Tesvich looked for an idea that would allow him to pursue his dream of entrepreneurship. “I was trying to figure out, ‘How do I create wealth? How do I build that freedom?’” he recalls.

But his idea came to him unexpectedly, when he saw a need. As a high school and college athlete, he knew many sports players were plagued by smelly socks and shoes. He started toying with the idea of creating anti-bacterial, odor-proof socks—but how?

The answer arrived after he was sidelined as a baseball pitcher by injuries. “So God closed the door for me there as a pitcher, and a few days after that, my roommate came home with an antibacterial towel—and that’s what sparked everything I did,” he says. After 18 months of research and development to create a prototype, he finally created a sock that doesn’t smell, using a similar fabric, and his business SKUNK SKIN took off. After winning on the Amazon Prime show “Buy It Now,” he sells the socks online in all 50 states and on seven continents.

Embrace a “service” mindset. Actively listening to customers can pay off many times over in a one-person business.“When I realized it’s not about me—it’s about living a life of service—that’s when things truly started to take off,” said Brown. “The minute I started shifting to really caring about the customer experience, really trying to serve the clients that I was serving to the highest and best outcome, that’s when things started to explode…If you can put those people first, your business will start to grow—period—and if it doesn’t, then you have to look at, ‘Okay, how am I communicating this?” Then it falls back down to marketing.”

Embrace the ownership mindset. This means not only means acting on the opportunities in front of you—“creating what you want to see in the world,” but also addressing challenges, as Maria Gonzalez-Branch, managing partner at Crescent Ridge, a venture capital firm that invests in early-stage companies, explained on the panel.

It also means being resilient—and spontaneous, according to Gonzalez-Blanch. “Sometimes you have to just do what the moment requires, and those are the best entrepreneurs, the ones that are good with uncertainty, improvising and moving on,” said Gonzalez-Blanch.

Grant “power of opinion” sparingly. In the legal world, most of us would only grant the power of attorney to someone we would trust with our life, as Brown explained. He sees a parallel in the entrepreneurial world—power of opinion, or judgment of our pursuits. “We grant our power of opinion to people whom we don’t respect, whose lives we don’t want, who want to keep us small, who are playing small themselves,” said Brown. “And we’re truly giving up our power.”

To succeed in a million-dollar, one-person business, it’s essential to steer clear of armchair quarterbacks and trolls. However, the answer isn’t saying, ‘I don’t care what anybody thinks about me,” Brown said. “That’s not true. We all care what people think about us. It’s just choosing who those people are. So I keep my ‘power of opinion’ very small. I look at people who are further ahead of where I want to be, who are living a life that I want to emulate, and I make them the judges of my opinion. If they come to me and say, ‘Hey, we think you’re out of alignment, or you’re not doing something,’ I really listen to that. But people who just want to throw stones, or who haven’t achieved the things I want to achieve or are not living the life I want to live? I feel free to let that stuff go. Because why would I listen to someone who is not creating the things that I want to create?”

With the million-dollar, one-person business trend picking up steam—and AI supporting that—there will likely be many more options for solopreneurs to break seven figures in the future. And that future will belong to those who dare to think creatively about what one person can accomplish on a shoestring.