Fleeing the corporate cubicle farm sounds enticing, especially when you’ve got a bad case of the “Mondays” or feel like you cannot possibly deal with one more copy-machine paper jam. Actually leaving isn’t quite so simple, though. Unless you’re independently wealthy (which begs the question of why you’re stuck in a cube farm to begin with) or blessed with extraordinarily generous parents, you’ve got to earn a living.
One resolution to this dilemma is to start your own business, which might conjure up ideas of securing venture capital or just being free to do only the really fun stuff. In reality, it often means being a solopreneur–at least at first.
Solopreneurs (a mash-up of the words “solo” and “entrepreneurs”) may freelance, consult, coach, offer services or sell products. The defining characteristic is that whatever they do, they do it without the help of a single employee. And that means they do everything, from product design to marketing to customer service, whether it’s fun or not.
$1 Trillion in Revenue
No matter what they make, sell or do, solopreneurs are becoming more common. In 2012, the latest year for which data is available, the U.S. economy had a total of 22.7 million solo businesses, a gain of almost 245,000 from 2011. Those businesses had total revenue of $1 trillion (yep, trillion) in 2012, up from $41.3 billion in 2011.
These statistics made us wonder. Where is solopreneurship especially popular? Where is it boosting the local economy? Where are solopreneurs reaping the most financial rewards?
So, we did a couple of our favorite things: We gathered some data and crunched some numbers. For the 100 most populated U.S. metro areas, we looked not only at how much solopreneurship has grown recently but also how well solopreneurs are faring.
America’s Top 15 Solopreneur Hubs
We know. You’re probably thinking New York City or the San Francisco Bay Area or perhaps Boston is going to top our list. Sorry, but none of those metro areas appears in our top 15. (See the table below for complete data on each of the top 15.)
1. McAllen, TX
Bottom line: The number of solopreneurs isn’t growing at a breakneck pace in McAllen, but these entrepreneurs’ businesses are doing well financially. They also make a substantial contribution to the local economy.
2. Allentown, PA
Bottom line: Allentown’s numbers are similar to McAllen’s, but they’re a little lower across the board.
3. Chattanooga, TN
Bottom line: Solopreneurs make a positive impact on Chattanooga, and they make a positive impact on the owners’ finances.
4. Youngstown, OH
Bottom line: Among our top four, Youngstown notched the highest growth in solopreneurs. For solopreneurs’ contribution to the local economy, Youngstown is second only to McAllen.
5. Akron, OH
Bottom line: Akron scores well in all of the areas we measured.
6. Detroit, MI
Bottom line: Detroit actually beats the top five metro areas in terms of growth of solopreneurs, but it scores more modestly elsewhere.
7. Bakersfield, CA
Bottom line: Bakersfield scores modestly in most categories, but its solopreneurs are bringing in more money than the typical resident.
8. Richmond, VA
Bottom line: The revenue for Richmond’s solopreneurs is growing decently, and those businesses are contributing a fair share of the area’s GDP.
9. Tulsa, OK
Bottom line: Among the top 10, Tulsa’s growth in solopreneurs is second only to Bakersfield’s.
10. Kansas City, MO
Bottom line: In terms of population, Kansas City is the second largest metro area on our list, and the revenue of its solopreneurs is seeing healthy growth.
11. Buffalo, NY
Bottom line: Buffalo ranks lowest among our top 15 in terms of solopreneurs per capita, but that likely will change, as solopreneurship is growing in popularity.
12. Des Moines, IA
Des Moines’ growth in solopreneurs is third among our top 15, and the revenue of these solopreneurs is doing pretty well.
13. Oklahoma City, OK
Bottom line: Oklahoma City‘s solopreneurs are growing in number and are reaping financial rewards. They also are making a substantial impact on the local economy.
14. Grand Rapids, MI
Bottom line: The number of solopreneurs is growing faster here than anywhere else in our top 15.
15. Daytona Beach, FL
Bottom line: Among our top 15, Daytona Beach is second only to McAllen in terms of the contribution of solopreneurs to the local economy. It’s also second only to Grand Rapids in terms of the growth of solopreneurs.
A Case for Lower-Demand Locales
Larry Keltto, owner of TheSolopreneurLife.com, often sees rankings of entrepreneur-friendly places that are dominated by college towns, which can be expensive places to live and do business. He prefers areas with low real estate expenses and other costs.
“To me, if you can be in a community that does have some vibrancy in it and a history of entrepreneurship but isn’t in quite as high in demand, I think that’s a good place,” Keltto said.
Lower expenses also can help solopreneurs when they’re just starting out and spending almost all of their time on marketing, he said.
“If you’re not coming into it with a stable of clients or work from a previous position, I would say 80 percent to 90 percent of your time is going to be spent on marketing,” Keltto said.
That number shocks most people, he said. Keltto advises would-be solopreneurs to ensure they’re willing to put in that time and energy before they quit their day jobs.
Sacred Heart Catholic Church is a landmark in downtown McAllen.
Making It Happen in McAllen
A low cost of living isn’t the only thing that first-place McAllen has to offer. Its chamber of commerce provides a litany of resources for local entrepreneurs, startups and inventors. Need help producing a video for a crowdfunding campaign? How about money to develop a prototype? Advice on your pitch or positioning? The McAllen Chamber of Commerce has expertise, grants and competitions that can help with all of that and more, President and CEO Steve Ahlenius said.
Supporting entrepreneurship is one of the chamber’s main goals.
“We want to diversify the economy. We want to foster innovation, and we want to develop a network of people who are entrepreneurial in nature,” Ahlenius said. “It’s something that’s always been here. It just needs to be fostered and encouraged and helped.”
|City||Metro population||Growth in one-person businesses||Revenue for one-person businesses as a share of GDP||One-person businesses per capita||Ratio of revenue to per-capita income||Ratio of growth in revenue to growth in one-person businesses|
|Kansas City, MO||2,038,690||0.8%||6.1%||0.07||0.97||1.84|
|Des Moines, IA||589,443||3.7%||5.1%||0.07||0.96||1.60|
|Oklahoma City, OK||1,297,397||2.7%||8.9%||0.08||1.15||1.40|
|Grand Rapids, MI||1,005,493||33.3%||7.0%||0.07||1.20||0.11|
|Daytona Beach, FL||595,348||28.4%||13.3%||0.08||1.15||0.02|
We arrived at our rankings by looking at five measures. We gave the most weight to those at the top of this list and the least to those at the bottom.
- How fast the revenue of solopreneurs grew compared with the number of solopreneurs. In some metro areas, there could be huge growth in the number of solopreneurs, but those businesses might not be bringing in much money. This number ensures we’re awarding points to the metro areas where solopreneurs are succeeding financially. It’s measured as the ratio of growth in the revenue of solopreneurs to growth in the number of businesses without employees (between 2010 and 2012). Any number above 1 indicates revenue for solopreneurs is growing faster than the number of solopreneurs.
- Growth in the number of solopreneurs. Money matters, of course, but so does growth in the number of solopreneurs in a metro area. This component is based on numbers from 2010 to 2012.
- How much the revenue of solopreneurs contributes to the local economy. This is measured as the revenue from one-person businesses as a share of a metro area’s gross domestic product (GDP) from 2010 to 2012.
- The number of solopreneurs per capita as of 2012. Growth numbers alone tell only part of the story. Some metro areas could be seeing substantial growth in the number of solopreneurs but be starting from a low base. Some already could have a ton of solopreneurs, which leaves less room for growth.
- How the individual revenue of solopreneurs compares with local per-capita income. This measure helps show how solopreneurs are doing compared with typical local income. It’s a little tricky, though, because per-capita income numbers include proprietors’ income, so we gave it the least weight in the ranking. The Census Bureau counts all businesses without employees the same way, whether they’re legally set up as sole proprietorships, partnerships or corporations. The vast majority of one-person businesses are sole proprietorships (19.6 million).
Photo of Youngstown, OH, courtesy of Thom Sheridan/Flickr; photo of Oklahoma City, OK, courtesy of Pixzard.com; photo of Richmond, VA, courtesy of Richmond Metropolitan Convention and Visitors Bureau; photo of Kansas City, MO, courtesy of Kansas City Convention & Visitors Association; photo of Chattanooga, TN, courtesy of Chattanooga Convention & Visitors Bureau; photo of Des Moines, IA, courtesy of Wikimedia Commons; photo of Bakersfield, CA, courtesy of National Society of Hispanic MBAs; photo of Allentown, PA, courtesy of Wikimedia Commons; photo of Akron, OH, courtesy of Knight Foundation; photo of Detroit, MI, courtesy of Vito Palmissano/Detroit Metro Convention & Visitors Bureau; photo of McAllen, TX, courtesy of GraniteGrok.com; photo of Grand Rapids, MI, courtesy of Michigan.gov; photo of Daytona Beach, FL, courtesy of Wikimedia Commons; photo of Tulsa, OK, courtesy of Oklahoma Tourism & Recreation Department; photo of Sacred Heart Catholic Church courtesy of ExploreMcAllen.com.