Empire of One
Thomas Frey
Running a solo business in the past
meant that you had a one-person practice, most often offering a
professional service, well suited for lawyers, accountants, and
doctors. However, a new breed of solo business has emerged that allows
people to leverage the power of the Internet and control a vast empire
from their home office or wherever they happen to be. Across the world
thousands of people are giving birth to what is being called an “Empire
of One”.
Running a solo business in the past meant that you had a one-person
practice, most often offering a professional service, well suited for
lawyers, accountants, and doctors. However, a new breed of solo
business has emerged that allows people to leverage the power of the
Internet and control a vast empire from their home office or wherever
they happen to be. Across the world thousands of people are giving
birth to what is being called an “Empire of One”.
In 2004 Mike Cayelli worked as a manager in the contractor division of
a large hardware chain when he decided to break loose and launch an
online retail business. He started by doing his homework, looking for
interesting niche products he could sell.
“I wanted a product that could produce high sales volume and a high
profit margin,” said Cayelli. “I didn’t want something that only sold
one unit per week.”
Since his house was rather small, he was looking for a product that was
small where the inventory could fit into something the size of a
footlocker, and could be hauled around in a car trunk.
“One morning at 6 a.m. I stumbled onto some cuff links for sale on eBay
and noticed there was tremendous action on that listing. I ran upstairs
and woke up my wife and told her I’d found the right product.”
Not wanting to risk everything, he held onto his day job and with a
$500 investment, made some overseas contacts, purchased a small initial
inventory, and started selling under his new business name,
CuffDaddy.Unlike the fashionable business trends of the past, and far
different than the junk bond era or dot com IPOs, the Empire of One has
the potential of significantly shaking up the world of commerce because
it signals a stealthy shifting of power far different than anything in
the past.
Cayelli continues, “When I put the first samples up for sale at eBay
and they sold extremely quickly, I knew I was onto something. We wound
up with six regular vendors based in China, Hong Kong, and India that
provide us with a product line that we buy for between $1 and $6 a pair
and sell for $15 to $55 a pair.”
As for shipping, about 90% of his orders can be mailed first-class with
two stamps in a .13-cent padded envelope. This year he is projecting
sales in his growing cufflink empire to be a very respectable $500,000.
In addition to the money Cayelli hopes to make, the features that make
an Empire-style business like this so appealing are the fact that they
are lawsuit-resistant, governmental-control resistant, tax-resistant,
employee-problem resistant, and for the most part, unregulated. It’s
the closest thing to being crowned king in the business world without
having responsibility for filling potholes.
Current CEOs and business executives will be drawn to this kind of
business because it gives them greater power and control without all
the responsibilities. Headhunters trying to recruit corporate
executives will find the allure of the Empire of One to be stiff
competition. It is an opportunity well suited for the global economy
and it knows no limitations.
Emerging Trends
Americans who do all or part of their job at home equal roughly 45
million and that number is growing rapidly. There are an estimated
24.7 million small businesses in the United States.
The number of solo entrepreneurs in June 2005 fell 3.1 percent or
303,000 from the month before, Labor Department data showed. Self
employment tends to fall as the economy grows. That’s especially true
among laid-off workers who start tiny companies after failing to find
work in slow times. For every 100 individuals that join the ranks of
the unemployed, 7 will start a new business.
At least 70% of new startups will be started by lifestyle entrepreneurs
– people who’ve gone into business to take more control over their
lives and to build a lifestyle that suits them. Health and happiness
are bigger priorities than wealth. 57% said they would not take on
extra stress even if it meant more money.
Only 23% of entrepreneurs go into business to make lots of money, and
only 3% want to be the next Richard Branson. From the 23% who want to
make lots of money comes a growing subset of empire-builders wanting to
break the traditional business mold and start something they can manage
and control themselves.
Empire of One Defined
An Empire of One business is a one-person (sometimes married couple)
business with far reaching spheres of influence. Typically the
business out-sources everything – information products marketed and
sold online, or products manufactured in China or India, sent to a
distribution center in the US, with customers in the UK and Brazil.
Manufacturing, marketing, bookkeeping, accounting, legal, and
operations are all out-sourced to other businesses around the world.
Yes, much of this has been done before, but a person’s ability to
leverage people and products across country lines in a below-the-radar
fashion, and still maintain control of a vast and virtual empire is
refreshingly new.
The Empire of One business model is one with great appeal to former
corporate executives with global contacts and good ability to manage
things remotely. With improving economies and Boomers searching for
meaning and significance in their lives, we are about to see an
exponential increase in these types of businesses in the years ahead.
Skill Requirements
Skills needed to run an Empire of One business are better categorized
as “intelligent skills” as opposed to the “brute force skills” needed
in the past.
Yes, you need to be a self-starting, not easily intimidated person who
enjoys competition. But you also must be a good risk-taker who
understands strengths and weaknesses, resilient and adaptive, able to
make decisions quickly, and a person who doesn’t view mistakes as
failures.
An “Empire” business requires you to be more of a business architect
than a manager. As most successful entrepreneurs quickly learn, there
are very few rules that apply to every business, and this style of
business is no exception.
The business architect skill requires that the owner be adept at
instantly changing focal distance, switching quickly from tactical to
strategic and back again. Often times a seemingly insignificant
workflow issue will put the business in a headlock and demand immediate
attention. But once a solution is implemented it is imperative that
the owner assume a high altitude perspective of the business to see if
there are any ripple effects – making sure the fix isn’t worse than the
original problem.
Most Empire of One businesses require an affinity for working in the
online world. The Internet is an unparalleled communications tool,
growing organically in ways few could have imagined, and in ways that
are difficult to manage. Unlike putting a product on a store shelf and
counting the number of sales, feedback loops for gauging influence and
making good decisions online are not always intuitive. Quite often the
mention of a product online today could yield results several months
from now, and the establishment of an online brand is far different
than traditional corporate branding.Few people can run their Empire
business without good relationship-building skills. While it is
commonly thought that online businesses isolate people, and owners end
up being quite insulated from their customers and vendors, successful
businesses are far more sustainable if they are built on a foundation
of good will and solid relationships. Relationships can be as weak as
an email exchange or a voice at the end of the telephone, or as strong
as lengthy face-to-face meetings. But, a person’s ability to build
endearing forms of communications between affected parties has a direct
correlation to the likelihood of success.
As with all business, the most critical skill is money management.
Most solo business operations have bookkeepers and accountants doing
the detail work, but managing the day-to-day income and expenditures
falls squarely on the shoulders of the owner. And it will forever be a
daily race to keep income ahead of expenses.
Other Examples of “Empire of One” Businesses
As you can imagine, an Empire of One business comes in a variety of
different forms. Here are a eight different examples of this kind of
successful solo venture:
* Soap Business – Ellen Cagnassola is a work-at-home mom who
produces homemade, personalized glycerin soaps and sells them through
her website SweetSoaps.com. She has also figured out how to get big
companies like Johnson and Johnson to distribute and sell her soaps for
her.
* Hair Restoration Business - Andy Bryant, the best-selling author
of The Baldness Cure, has created a line of hair restoration products
that he sells both wholesale and retail online. His success is the
result of a personal quest to reverse his own hair loss.
* Knowledge Broker – Because the barrier to entry is relatively
low, many Empire of One businesses start by brokering information. As
an example, Marty Foley is a successful home business owner and the
founder of ProfitInfo.com. His Houston-based business sells online
Internet marketing techniques and resources.
* Online Ezine - Alexandria Brown, known as The Ezine Queen, is an
expert on driving business via e-mail publishing. Her tutorials,
teleseminars, and workshops have taught many solo professionals and
small biz owners how to market online inexpensively to get more
clients, customers, and long term sales. She is also the author of the
book “Boost Business with Your Own E-zine”.
* Blogging Business – Steve Pavlina runs a blog named after
himself, StevePavlina.com. The site was launched 19 months ago.
According to his blog “12 months ago it was averaging $4.12/day in
income. Now it brings in over $200/day from Google AdSense. I didn’t
spend a dime on marketing or promotion. In fact, I started this site
with just $9 to register the domain name, and everything was
bootstrapped from there.”
* Education Training Products - Kelly Monaghan is the author and
publisher of a number of award-winning travel guides, including The
Insiders Guide To Air Courier Bargains. He is also the creator of the
audio training program, Winning Customer Satisfaction. He has developed
customized sales training programs — including both video and audio
elements — for such major corporations as AT&T, Brinks, Executone
Information Services, Ogden Services and others.
* Musician Business – The music industry has long been the
playground of rogue individuals. Recently the British group, The
Arctic Monkeys, boasted sales of nearly 120,000 copies of its debut
album in a single day, due in part to savvy use of the Internet to
market to their fans. Many musicians see iTunes as the perfect online
storefront that will allow them to sell whatever music they produce for
many years to come.
* Travel Business – Barbara Hardesty comes from a long line of
Italian artisans. With a business background, and having managed a
Tuscan cooking school, Barbara had just the right ingredients for
offering trips to Italy to relive the life of Leonardo DaVinci. Her
business, DaVinci Capers, offers regularly scheduled trips to her
upscale clients.
The Advantages
Whether you are Mike Cayelli working in a hardware store, Kelly
Monaghan bumping across Tibet in a jeep or white water rafting in
Nepal, or Steve Pavlina diligently hammering out the next blog entry,
the Empire of One business knows no geographical limitations. Wherever
you go, the business goes with you.
In addition to the issue of flexibility, Empire businesses tend to fly
below the radar. In our super-litigious society, a business’ ability
to avoid legal challenges is directly related to its odds of
succeeding. Beyond the monetary costs, litigation extracts an
emotional toll that has ruined the lives of countless aspiring
entrepreneurs. For some, a lawsuit resistant business is the most
appealing feature.
For others, the elimination of human resource responsibilities is the
key. In the US more and more laws are added every year governing
employer responsibilities to their employees. An Empire business has
no employees – potentially many contractors, but no employees. The
business adds or subtracts contractors according to the needs of the
business, and since it is not providing a place of employment, very few
laws apply.
It also means no payroll, no withholdings, no workman’s comp, no
matching FICA, no 401K plans, no health insurance, and no monthly or
quarterly forms for the IRS. Yes, contractors are paid according to
the terms of the contract you sign with them, but it’s just a single
line item expense.
In the emerging global environment, this type of business means that
you can pick and choose advantages from around the world. A corporation
can be formed in the country offering the best advantage for that type
of corporation. Manufacturers, distribution centers, banks, and
hosting and data centers can also be placed in countries that offer
their own distinct advantage – very often a reduction or elimination of
taxes.
The business can be as simple or complicated as you wish to make it.
In a rather extreme scenario the business owner lives in one country,
has a corporate entity formed in a 2nd country, products manufactured
in a 3rd country that are sent to a distribution center in a 4th
country. And if the bank for the business is in a 5th country, with
servers for the companies online business are in a 6th country, and
products sent to customers in 20 different countries, the laws
governing the transactions can either be overwhelming, or in the view
of some entrepreneurs, non-existent. Wary entrepreneurs can hedge
their risks by creating a redundant counterpart to each leg of the
product journey that takes over at the first sign of a problem. Income
streams and payments can be routed quickly to the safest possible
destination.
Rest assured, we are not advocating the circumvention of governing laws, just acknowledging the limitations in enforcing them.
Some Final Thoughts
Currently no one is offering training for this type of business
enterprise. It is both a business for pioneers and daring risk-takers,
and a logical extension of our current business culture.
A thorough understanding of e-mail, teleconferencing, and
videoconferencing is vital. Knowledge of other tools such as webcasts,
project management software, electronic white boards, bulletin boards,
and wikis help Empire builders develop digital environments that foster
ingenuity and maintain control.
Over the past few months I have traveled across the country and
presented this idea to many different groups. Invariably people will
come up to me afterwards and fondly say that I just described their
businesses. They love the Empire of One moniker but just never knew
what to call it.
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