The rise of the one-person company

In 1937 the economist Ronald Coase asked a question that sounds naive. If markets are so good at allocating resources, why do companies exist at all? Why does anyone hire employees instead of buying every piece of work from whoever offers it best that day?

His answer was transaction costs. Using the market is expensive. You have to find the right person, agree on what they will do and at what price, and then check that they did it. For most work it was cheaper to hire someone once and direct them every day than to pay those costs over and over. The company is what you get when coordinating inside is cheaper than contracting outside.

That answer still holds. What has changed is the size of those costs, and that is why we think the next decade will see a large share of work move outside the company, to people who run businesses of one.

The three costs that are falling

Finding someone used to depend on who you knew. It still does, but the reach of one person's network has grown enormously. A specialist in Zurich with a visible body of work can be found by a company in Basel or Berlin in an afternoon. Search is no longer the bottleneck for anyone who makes their work easy to see.

Agreeing on the work has always been the expensive part. Most contracting goes wrong at the brief. The company could not say clearly what it wanted, and the contractor delivered something reasonable that was not it. This is where AI changes more than people expect. Writing a precise specification, breaking a project into pieces that can be checked, and turning a vague request into acceptance criteria are tasks language models are genuinely good at. The cost of describing work is dropping fast.

Checking the work is the third cost, and it is falling for the same reason. Reviewing code, testing a model, reading a contract against a checklist or comparing a design with a brand system used to need someone senior. Much of that first pass can now be automated, which means a company can buy work from outside and verify it without building a team to do so.

On the other side of the market, running a business of one has become cheap. Accounting, invoicing, contracts, payments and a professional web presence are each a subscription now. The same AI tools that help companies describe and check work also help the individual deliver more of it. A designer who can ship the front end, or a finance specialist who can build both the model and the dashboard, covers ground that used to need two or three people.

When the cost of contracting falls and the capacity of one person rises, the boundary Coase described moves. The company gets smaller and the market around it gets larger.

A test for what moves outside

Not all work moves. The useful question for any role is whether you can write down what done looks like, and whether you can check it without the person who did it in the room.

If both answers are yes, the work is modular, and modular work can be bought. Building a feature against a clear spec, producing a financial model, running a campaign with defined targets, translating a product or auditing a security setup can all sit outside the company.

If either answer is no, the work depends on context that is hard to transfer. Deciding what to build next, handling a key customer, setting priorities across teams and remembering why past decisions were made all fall into this group. Economists call this relationship-specific knowledge. It takes months to build and it is worth the most inside one company. That work stays with employees, and it becomes the core of what a company is.

We expect companies to end up as a small permanent core that holds the context, surrounded by a changing set of outside specialists who hold the skills. Film production has worked this way for decades. A studio keeps a small team, assembles hundreds of independent specialists for a production and lets them go when it wraps. Construction works the same way with general contractors and subcontractors. Knowledge work is starting to look like a film set.

The single tenant

The people on the outside of this model are not freelancers in the old sense of someone between jobs. We think of them as single tenants: one-person businesses that rent their capacity to several companies at once, the way a building rents space to several tenants.

The word matters because it points at the main risk. A single tenant with one client is not independent. They carry all the risk of self-employment and none of the protection of a job. In Switzerland, economic dependence on one client is also one of the signs the social insurance offices look at when they decide whether someone is truly self-employed. If one company is effectively your only employer, the law may treat it as one, and that company can end up owing the contributions it thought it had avoided. The healthy version of this model has a rule built in: no single client should make up most of a tenant's income. That protects the individual and the companies that work with them.

There is a second cost people underestimate. An employee's salary is not what a contractor should charge for the same work. A self-employed person in Switzerland pays the full social insurance contribution instead of half of it, is not covered by unemployment insurance, has no mandatory occupational pension, and is not paid for holidays, illness, sales time or the weeks between projects. A fair contractor rate is therefore well above the equivalent salary. Companies that compare day rates with salaries and conclude that contractors are expensive are comparing the wrong things. The right comparison is the full cost of an employee who is only needed for part of the year.

What breaks inside the company

Companies that move work outside run into problems they did not have before.

Knowledge walks out at the end of every engagement. When the person who built something leaves, the reasons behind it leave too. Companies that rely on outside specialists have to pay for documentation as part of the work and treat a clear handover as a deliverable, not a courtesy.

Coordination gets heavier. Twenty outside specialists means twenty contracts, twenty sets of access rights, twenty invoices and twenty offboardings. Most companies handle this by hand today, and it does not scale.

Trust has no infrastructure. An employee comes with references and a probation period. A contractor's track record is scattered across past clients and across platforms that own the reviews. There is no good way to carry a verified history of work from one client to the next.

Where this leads

Each of those problems is a business. We expect software that handles the whole life of an outside specialist inside a company, from the status check before a contract is signed to removing access on the last day. We expect pension and insurance products built for businesses of one and pooled across many of them, so they can be priced fairly. And we expect reputation to move from platforms to people, as verified records of work that the contractor owns and can show to any client. We will write about some of these in more detail as Blueprints.

An outlook is only useful if it can be wrong, so here is what we expect and when. By the end of 2028, working with someone as an outside specialist first and hiring only once the role proves permanent will be normal practice for specialist roles at Swiss startups and small companies. By the end of 2029, software for managing outside specialists will be a category of its own with clear leaders, the way payroll software is today. By 2030, the strongest one-person businesses will deliver the output of a small agency, with AI doing much of the work that junior staff used to do. We will come back to this in October 2027 and say plainly what we got wrong.

What to do with this

If you are employed, the practical step is to make your work visible and checkable. The people who do well in this shift will be the ones whose results can be seen and verified by someone who has never met them.

If you run a company, go through your roles with the two questions above. Keep the context inside and pay for it properly. Buy the modular work from outside, and build the habits that make that safe: clear briefs, documented handovers and fair rates.

If you build products, look at the single tenant as a customer. A growing number of people run a company of one with tools designed for teams of fifty. That gap is where we are looking.