The Empire of One 

“The fundamental unit of the new economy
is not the corporation, but the individual.”

- Thomas Malone & Robert Laubacher

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.

By Thomas Frey