Growth isn’t always good. In fact, growing for the sake of growing can hurt a business. In this book, Paul Jarvis challenges traditional ways of thinking about business and work, and shows why being small can be a goal in itself. The insights are relevant for anyone who wants to design their work to support their desired lifestyle, be it freelancers, entrepreneurs, or managers in a large organization. In this Company of One summary, we’ll explain how you can enjoy the benefits of a large company—including revenue, autonomy, fans, and enjoyable experiences—without the burdens of one. For more details, examples and actionable tips, do get our complete book summary (in text, infographic and audio formats).
Company of One: Become Better, not Just Bigger
When we think of business, we tend to assume that bigger is better. The default is to keep adding more—more customers, more employees, more products etc. But, what if you can spend/do less and have more time, money and freedom to live the life you want?
Bigger isn’t always better
Growth is often used to measure business success. When a company does well, it tends to hire more people, build more infrastructure, expand its customer base and product range. However, growth isn’t always beneficial. Unchecked growth is fatal for startups and established organizations alike.
The Startup Genome Project found that 74% of high-growth tech startups failed because they scaled up too rapidly. Pets.com was one of the rising stars during the dot-com boom. However, its rapid growth was fueled by aggressive marketing—in the 2nd quarter of 2000 alone, it spent $17 mil on an advertising campaign when its revenue was only $8.8 mil. The company ended up losing almost $300 mil.
Established companies can also get caught in the growth trap. Starbucks lost money when it tried to expand into CDs, fancy drinks and sandwiches. In the end, they had to scale back, close hundreds of stores and refocus on what they did best—coffee.
Staying Small as an End-Goal
A Company of One represents a different mentality. It’s not anti-growth, but it questions (i) if growth is truly needed, and (ii) if so, how to grow with the same or less resources. Instead of growing for the sake of growing, it considers if and how growth can serve its end-goals.
A Company of One also isn’t the same as freelancing. Freelancers exchange time for money, whereas a Company of One brings in sustainable revenue in a way that serves your life goals. Anyone—be it an entrepreneur or a corporate leader—can adopt the mindset/model of a Company of One to build a lean and agile setup that can survive in any economic climate.
In our complete version of the Company of One summary (get full 14-page summary here), we’ll elaborate more on the what’s and whys of a Company of One, including:
• The 4 reasons companies seek growth (besides economies of scale), and why these can all be fulfilled by staying small as a Company of One;
• Why a bigger company may not be better, more stable or profitable (both from the perspective of financial rewards or career-growth);
• Examples of how a Company of One can be embedded in a large organization;
• The 4 traits of a Company of One; and
• What it takes to lead a company of one.
In short, the main idea is to focus on what you can do now with existing resources to make the business better, not just bigger.
• Instead of using growth as the only measure of success, focus on other indicators e.g. depth/quality of customer relationships, happiness for you, your employees/customers, and resilience.
• Don’t just set a lower bound for your goals (e.g. “I want to earn at least $1mil”). Learn to also set an upper bound, i.e. the point where you start to experience diminishing returns on your profits or enjoyment (e.g. “I want to earn at least $1 mil but no more than $1.5mil”). In 1996, Southwest Airlines could expand to more than 100 cities, but it chose to serve only 4 new locations at a time. This upper limit helped them to stay profitable at a time when most airlines were losing lots of money.
Building & Maintaining a Company of One
In the book, Paul Jarvis shared many dos and don’t of running a Company of One. We’ve organized these insights into 5 main sub-sections. Here’s a brief overview of what’s covered in the book and our full Company of One summary (click here for the text / graphic/ audio summary):
Adopt the Right Mindset
To succeed as a Company of One, you need a clear purpose that guides your decisions and everything you say and do. Here, you’ll learn:
• The difference between purpose and passion, and how best to transit from your existing career to a new field;
• Why a busier life isn’t always better and how you can start to focus your time and energy more productively.
Launch and Iterate with Baby Steps
A new product idea involves many assumptions about what your customers want/need, how well your solution works, what’s the ideal price-point etc. Release the smallest possible version of your idea so you can start to test your assumptions, learn what works and doesn’t, and start earning money instead of spending it. In the complete Company of One summary, we’ll explain:
• How you can start testing a product concept (and earning money) before you spend time/money to build it;
• What’s Minimum Viable Profit (MVPr) and why you should aim to achieve it asap; and
• How to keep launching and evolving.
Leverage Scalable Systems
Scale up without getting bigger. The key is to use scalable systems that allow you to keep your team lean and focused. Consider scalable systems for at least 3 areas: (i) creation, (ii) connections and (iii) collaboration (more details in our complete 14-page summary).
Stand out with your Unique Personality
Every brand has a personality that’s determined by what it says and does, e.g. Harley-Davidson connotes rebelliousness, and Snapchat connotes youth and freshness. Find out in our full Company of One summary:
• Why you must design your brand personality, and how to do that in a meaningful way; and
• How to use polarization to spark debate and create visibility without expensive advertising.
Build Trust and Long-term Relationships
It’s easier to sell to someone who already has an established relationship with you. Unfortunately, companies obsessed with growth can get so caught up with acquiring new customers that they neglect existing ones. Companies of One should leverage on their small size to develop close, personal relationships with their clients. Learn more about:
• The importance of social capital, and how to earn loyalty by helping your customers to be profitable and successful.
• How you can build trust, connections and loyalty with a Company of One, including (i) teaching customers everything you know (yes, everything), and (ii) using word-of-mouth.
Starting your own business or a Company of One
Starting a business isn’t for everyone. As your own boss, you must be prepared to learn and execute a range of activities (e.g. HR, accounts, product development, sales and marketing), and put aside your ego to achieve your purpose.
Before you make the leap to start your own business, build your skills and customer base on a part-time basis first. As you set up your business, consider several factors including: (i) money (how to minimize expenses and use your time optimal to achieve your MVPr asap), (ii) legal (set up your business as a separate legal entity so you’re protected from personal liability), (iii) accounting (find a firm/person who can advise you on financial laws and taxes), (iv) salary, savings and lifestyle (set aside adequate income, savings, investments, and design your business to have your desired lifestyle.
Other Details in the “Company of One” Book
This is an easy-to-read book written in a conversation style. Paul Jarvis shares a range of personal anecdotes, real-life examples and empirical studies to support his insights and recommendations on a Company of One. Do get a copy of the book for the full details, get our full summary bundle for an overview of the various ideas and tips.
Find out how to enjoy the benefits of a large company without the burdens of one!