A sole proprietorship is the most popular and straightforward business structure. A sole proprietorship has only one owner, and there’s no legal distinction between the individual and the business. Considered the default business entity, you are a sole proprietorship if you don’t legally form a business entity.
As such, many businesses could be a sole proprietorship without knowing it. For example, a freelance writer is probably a sole proprietor, as is an independent contractor providing services on a “sharing-economy” platform. As a business owner, understanding the benefits and disadvantages of sole proprietorships will help you make an informed decision on which business structure is ideal for your particular industry and situation.
If you don’t know which business entity is right for you, check out our video series on choosing the best type of business structure. For a general overview of sole proprietorships, see the video below; for more in-depth coverage, continue reading.