Million-dollar one-person businesses multiply

There’s no mistaking it: Million-dollar, one-person businesses are picking up major momentum in the U.S.

More of these tiny firms–which have no employees except the owners– are breaking into every category of business above six figures in revenue, according to newly released Census Bureau statistics. That’s exciting news for people who don’t want to work for “the man” but still need to earn a healthy income. If they can do it, perhaps you can, too.

Here are the latest findings:

29,494 companies made it into the $1 million to $2.49 million revenue range in 2012. That’s a 10% increase in one year. In 2011, 26,744 firms made it into this revenue range.

The largest group in this category is made up of professional, scientific and technical services firms, with 7,431 businesses in this category. Retail firms followed, with 2,713 represented and construction firms, with 2,637.

1,900 made into the $2.5 million to $4.99 million revenue range for 2012– up from 1,723 in 2011. Here again, the numbers rose 10%. The top category is retail, with 513 businesses hitting this mark.

There were 386 firms in this category who made it to $5 million in revenue or more in 2012. The number rose almost 5% in one year, up from 368 in 2011. Most of the businesses in this elite cohort (311 in total) are in finance and insurance. The next biggest group is those in arts, entertainment and recreation, with 63 firms.

There’s one mysterious sub-category here: In professional, scientific and technical services, Census data shows there is at least one business. However, the Bureau declined to share data, to avoid disclosing information on individual businesses.

There’ s more good news: As the economy gets a little stronger, more microbusiness owners are breaking $100,000 in revenue–and making it into the mid-to-high six figures.

221,815 brought in $500,000 to $999,999. That’s up nearly 6% from the 209, 415 in 2011. Real estate rental and leasing firms dominated here, represented by 86, 217 firms.

513,137 broke into the $250,000 to $499,000 range. The numbers rose almost 6% here, too, from 484,479 in 2011. Here again, real estate rental and leasing businesses led the pack, with 155,409 firms.

1.7 million hit six-figure revenues, achieving sales in the $100,000 to $249,000 range. That’s also an increase: In 2011, 1.6 million owners made it into this category. For 2012, real estate rental and leasing firms were the top players in this category, with 368,301 businesses reaching that revenue level. They were followed by professional, scientific and technical services firms, with 253,270 representatives.

Of course, there are plenty of one-person businesses that fail or will never make anywhere near this much. The Census Bureau counted 22.7 nonemployer firms in 2012, up from 22.5 million in 2011. The largest revenue category in 2012 was $10,000 to $24,999, with 5.7 million firms represented. Some of these are probably side ventures.

And clearly, though these firms don’t have employees on the books, they may employ contractors– in some cases quite a few. It’s hard to imagine that all of the construction firms the Census Bureau counted rely on the labor of just one or two owners.

It is also important to note that revenues aren’t the same as the pay the owner earns. After taxes and expenses are subtracted, the owner of a $1 million firm may take home less than half in a high tax state. Often, owners reinvest in the business, instead of taking a lot of money out to pay themselves.

Still, this evidence shows that, without a doubt, more people are thriving in microbusinesses. Whether that’s because the improving economy has put the wind at their back, more are using labor-saving technologies to expand their businesses or for some other reason, I don’t know–and I welcome your insights. I will be asking experts for their views in future blog posts. (Please post any questions you want me to research in the comment area, as readers did last year.)

I’ll also introduce you to some amazing people who run million-dollar businesses in upcoming posts. I’ve spoken with some of them over the past year and loved hearing how they pursued their dream of business ownership. If there’s one common thread, I’d say these are very hard working folks who have learned how to do things very efficiently, to multiply their own output without formal employees.

They have a lot to gain. They’re the ones who get the payoff from their efforts (or at least what’s left after taxes!) — not a corporate CEO who thinks nothing of laying off thousands of employees with the stroke of a pen.

These million-dollar business owners have what many of us want: freedom and independence. They know, better than anyone else, that the value of having those things transcends the numbers they see on their balance sheet. I’m looking forward to seeing their numbers rise, as more people figure out how to join them. –http://www.forbes.com/sites/elainepofeldt/2014/04/29/million-dollar-one-person-firms-multiply/