← Back to context

Comment by jameslk

7 hours ago

In a 1-person company, who or what generates a profit?

One person isn't a company. Legally maybe, but there's no point in a company if you can profitably do all the labor yourself.

  • I may be able to do all the labor myself, but need investors because I can’t afford the capital.

    I may be able to do all the labor myself, but want to ensure continuity beyond my ability or interest to do the labor myself. (Sometimes this is by my wish; sometimes by the wish of consumers of my service.)

    I may be able to do all the labor myself, but not expose my entire net worth to the financial obligations of the company.

    There are plenty of cases where a single person company makes good sense.

  • There are holding companies with zero employees. They typically pay a management fee to someone.

  • At what point does a company become a company if one person doesn’t make a company? What’s the threshold for non-labor where a company becomes a company?