The Rise Of The Million Dollar, One-Person Business • Hacker News Board

Re: The Rise Of The Million Dollar, One-Person Business

#51

Post by _delirium » Sun, Jun 30, 2013, 9:30 PM UTC

tptacek wrote: post #9

jere wrote: post #2

>I’m not sure that these are all truly one-person businesses. In my reporting, I often come across firms with a regular team of 7 or 10 people, but only one or two classified as W2 employees and the rest working as contractors. I have to agree, since I find it mind boggling that one-man construction firms are making millions.

These are businesses with sales in the low 7 figures. A 1-person contracting firm netting 1MM/yr would be impressive. Most small construction firms are staffed with 1099s.

It would be interesting to get some data on typical profit margins among these firms. The few I know have quite low profit margins overall. An uncle of mine until recently ran a distribution business sourcing gift-shop items and selling them to gift shops, which would fall into the $1m-$2.5m-revenue category this article discusses. But his profit margins were typically ~5-10%, so he was basically netting a middle-class salary.

Re: The Rise Of The Million Dollar, One-Person Business

#52

Post by brandnewlow » Sun, Jun 30, 2013, 9:32 PM UTC

reeses wrote: post #49

tunesmith wrote: post #33

I think about this a lot - I made the jump from salaried worker to self-employed programmer/freelancer/contractor/consultant (depending on how you look at it). But I'm doing enterprise-level architectural programming. It's not very amenable to productizing, so I'm basically stuck being paid for my time. What that means is that if I want to have a long-term high-security relationship with a couple of key clients, I ba…

First of all, f### "first-world problems" when it comes to something like this. It's personal and it's your life. You only get to perceive one run at this one. I posted a few things in Patrick's thread that I won't repeat here[1] regarding the move from a simple hourly rate to the ~$1m+ range. The thing I would work on in your case are your basic assumptions. I would try to get past the "long-term high-security relat…

I'd love to talk ecommerce some time. Could you drop me a note to the e-mail in my profile?

Re: The Rise Of The Million Dollar, One-Person Business

#53

Post by bergerjac » Sun, Jun 30, 2013, 9:34 PM UTC

tunesmith wrote: post #40

simonreed wrote: post #37

Earlier quoted context omitted.

"What's left is real estate, but I'm regularly told I shouldn't even bother if I'm not a fix-it handyman sort, which I'm not." You don't need to do the fixing yourself... My advice would be to read 3+1 Plan book ( http://en.wikipedia.org/wiki/The_3%2B1_Plan ). You can get it for free in PDF from the author if you sing up for one of his websites.

Looks like the 3+1 Plan is basically to buy a property, pay interest only, wait for it to appreciate, remortgage, use proceeds to buy another property. I think I'm looking for more detail from a hacker perspective - how to get access to RMLS systems, mine the data, what kind of criteria to look for for best arbitrage, what kind of moves you can make if you have $x in capital, etc.

> I'm looking for more detail from a hacker perspective - how to get access to RMLS systems...

Avoid premature optimization.

Re: The Rise Of The Million Dollar, One-Person Business

#54

Post by tunesmith » Sun, Jun 30, 2013, 9:43 PM UTC

reeses wrote: post #49

tunesmith wrote: post #33

I think about this a lot - I made the jump from salaried worker to self-employed programmer/freelancer/contractor/consultant (depending on how you look at it). But I'm doing enterprise-level architectural programming. It's not very amenable to productizing, so I'm basically stuck being paid for my time. What that means is that if I want to have a long-term high-security relationship with a couple of key clients, I ba…

First of all, f### "first-world problems" when it comes to something like this. It's personal and it's your life. You only get to perceive one run at this one. I posted a few things in Patrick's thread that I won't repeat here[1] regarding the move from a simple hourly rate to the ~$1m+ range. The thing I would work on in your case are your basic assumptions. I would try to get past the "long-term high-security relat…

Damn, this is really good advice. I find that as I get more senior, I have less immediate peers that set an example of what sort of next steps are possible, so these are good bits of advice to read.

Yes, the last year has included a lot of prototype experimentation with stuff like EIP (spring integration), amqp (rabbit), jax-ws (cxf mostly), Drools. I can see how pulling the thread on these could eventually turn into a product, but in the meantime it's really just been more about making the recommendation and then doing the implementation. I feel like I'd need a handful of more successful implementations before I can call myself the Consulting Enterprise Architect, but it's getting there.

Re: The Rise Of The Million Dollar, One-Person Business

#55

Post by pageld » Sun, Jun 30, 2013, 10:27 PM UTC

There isn't anything related to farming on there. Seems odd, especially when they're just talking about revenue and with how much money is in that sector right now.

At 6.60 / bushel corn @ 200 bushels per acre, it "only" takes 760 acres of corn to break the $1M revenue barrier. 760 acres isn't necessarily a lot and can be definitely run by one person, especially with some contractor help.

It probably has something to do with what's classified as a Non-Employer, but it just seems like it should be there.

Re: The Rise Of The Million Dollar, One-Person Business

#56

Post by mercutio2 » Sun, Jun 30, 2013, 10:29 PM UTC

mililani wrote: post #38

My dad started three small businesses on his own over the period of 20 years: a restaurant, an upholstery business, and a long line commercial fishing boat. First, let me just point out that sales (or revenue) does NOT equal profit. I'm pretty sure everyone here knows that. If you count just sales, then the upholstery business marked with inflation would probably be doing $150-200k a year in sales/revenue for a singl…

Since we're using accounting terms-of-art, you almost certainly don't mean that you would "net 500k", you mean gross 500k, right?

The popular culture seems to use net to mean "total in the income category", but in accounting it generally means EBITDA, i.e. your dad would gross $1m and net $100k.

Re: The Rise Of The Million Dollar, One-Person Business

#57

Post by liquidcool » Sun, Jun 30, 2013, 10:31 PM UTC

yogo wrote: post #5

> Many institutions in our society are still structured in such a way that W2 employees are considered the norm, and it is hard for even well-off people who are self employed to, for instance, get a mortgage without intense paperwork hassles. It was refreshing to read that. Even for an apartment it's almost foreign to most building managers when you say you are self-employed (they might even have an unwritten rule th…

I get around this a few ways. If they require it, you can show them your savings account that shows you can pay a year's rent in cash. But maintaining a good credit rating is often good enough. I thought I'd have to show bank records, but instead the property manager said I had a credit rating "like a bank" and that was good enough.

But the best advice I can give is to rent from an individual. You get so much more for less, because a lot of private party landlords just need to cover a very low mortgage from 10+ years ago, and getting peace of mind by renting to a professional is a good trade-off for below market rent.

Re: The Rise Of The Million Dollar, One-Person Business

#58

Post by 6cxs2hd6 » Sun, Jun 30, 2013, 10:52 PM UTC

crucialfelix wrote: post #34

yogo wrote: post #5

> Many institutions in our society are still structured in such a way that W2 employees are considered the norm, and it is hard for even well-off people who are self employed to, for instance, get a mortgage without intense paperwork hassles. It was refreshing to read that. Even for an apartment it's almost foreign to most building managers when you say you are self-employed (they might even have an unwritten rule th…

Even worse for me is that my clients have been in the US and I am in Germany. The landlords here would rather give an apartment to somebody who is on welfare. Seriously. I'm considering incorporating and granting myself a EUR salary just so there is a steady pay stub.

From what I've heard about German employment law, wouldn't you need to form a "work council" and fight with yourself? ;)

Re: The Rise Of The Million Dollar, One-Person Business

#59

Post by mililani » Sun, Jun 30, 2013, 11:36 PM UTC

mercutio2 wrote: post #56

mililani wrote: post #38

My dad started three small businesses on his own over the period of 20 years: a restaurant, an upholstery business, and a long line commercial fishing boat. First, let me just point out that sales (or revenue) does NOT equal profit. I'm pretty sure everyone here knows that. If you count just sales, then the upholstery business marked with inflation would probably be doing $150-200k a year in sales/revenue for a singl…

Since we're using accounting terms-of-art, you almost certainly don't mean that you would "net 500k", you mean gross 500k, right? The popular culture seems to use net to mean "total in the income category", but in accounting it generally means EBITDA, i.e. your dad would gross $1m and net $100k.

Oops, yes, my bad. I meant gross. Geez, even I can't get the terms straight.

Re: The Rise Of The Million Dollar, One-Person Business

#60

Post by sctechie » Sun, Jun 30, 2013, 11:45 PM UTC

tunesmith wrote: post #33

I think about this a lot - I made the jump from salaried worker to self-employed programmer/freelancer/contractor/consultant (depending on how you look at it). But I'm doing enterprise-level architectural programming. It's not very amenable to productizing, so I'm basically stuck being paid for my time. What that means is that if I want to have a long-term high-security relationship with a couple of key clients, I ba…

Stop charging for your time and start charging for the value you are providing to the business.

If you implement a system that will increase revenues, you should be charging based on that value. Just because you're implementing some back-end system does not mean you're not having an impact on the bottom line. Sounds like you've gotten stuck into thinking your old clients are your friends. Do you not have the confidence to pursue / win new clients if you're 'key' clients disappear?