The age of the solopreneur

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The age of the solopreneur<br>More solo founders, growing faster, powered by AI

Ernie Tedeschi, Marisa Rama, and Chris Cruickshank<br>Jun 22, 2026

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The US Census Bureau counts businesses as well as people. Four years ago, it made a major change to its business methodology. Until 2022, the Census Bureau assumed that businesses over a given revenue threshold must have employees. Even if a business declared itself a solo enterprise, it was automatically reclassified as an employer when it hit a certain income threshold.<br>By the early 2020s, these assumptions started creaking. The Census Bureau noticed that solo operators in some sectors were generating substantial revenue, and they didn’t seem to be hiring. And so in 2022, the Census Bureau systematically raised its income thresholds. The resulting counts of nonemployer businesses at higher income levels skyrocketed.<br>Today, Census Bureau Business Formation Statistics, cross-country business registration records, and Stripe platform data all suggest solopreneurs have continued to prosper.<br>This post advances three related arguments. First, solopreneurship is growing faster than employer-business formation, and the acceleration is validated by multiple independent data sources, making it unlikely to be driven by a fraud wave. Second, both the number and share of solopreneurs reaching meaningful income thresholds is rising. And third, early signals indicate that AI is filling the capability gaps that once made hiring necessary—and doing so fast enough to show up in the income distribution.<br>Thanks for reading Stripe Economics! Subscribe to receive new posts.

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Solopreneurs are multiplying much faster than employer businesses, and it’s not fraud

New business applications in the Census Bureau’s Business Formation Statistics have been flashing an unusual signal for the past 18 months. New business applications are filings with state agencies and the Internal Revenue Service that precede actual commercial activity. These new applications reaccelerated beginning in late 2024, after spiking in 2020 at the beginning of the pandemic and remaining elevated thereafter.<br>This acceleration, however, is not being driven by applications from businesses that have a “high propensity” or likelihood to become employers. The Census Bureau classifies certain new business applications as “high propensity” if it deems the business as likely to hire workers within the next eight quarters. The Census Bureau uses an internal statistical model that considers industry classification, whether an Employer Identification Number (EIN) was requested, and whether the applicant indicated planned wages. High-propensity filings have stayed relatively stable over the past 18 months even as overall applications have surged.

A similar spike in new business applications occurred early in the pandemic. The Paycheck Protection Program (PPP) was a small business loan program that the US federal government established in 2020. It required an EIN and little else for eligibility, creating strong incentives for applications with no genuine entrepreneurial intent. Economic research has found a contemporaneous increase in the composition of 2020 applications toward businesses likely to be nonemployers (Dinlersoz et al. 2021). The nonemployer surge peaked and partially reversed as the PPP program wound down—though interestingly, the level of business formations in the US stayed persistently higher than prepandemic.<br>For the current acceleration in new business applications, there is no comparable federal subsidy creating a financial incentive to file. The PPP stopped accepting new applications in May 2021, and the last forgiveness payout was in 2024.<br>Three further pieces of evidence argue against fraud specifically. The first is that Stripe pay-in data is also consistent with the read that recent business sign-ups are legitimate. Stripe cannot distinguish between solopreneurs and employers among business sign-ups, but we do validate the overall acceleration and the meaningful activity of these businesses. Businesses that signed up on Stripe after 2023 reached material transaction volumes earlier than the sign-up cohorts that preceded them. The share of businesses (not just solopreneurs) reaching $1 million in cumulative revenue within a year after going live on Stripe was roughly 30% higher for the 2025 cohort as it was for the 2023 cohort, and it was roughly 3x higher for the 2025 cohort than the 2019 cohort. If more recent sign-up cohorts were increasingly driven by inactive businesses, we would expect more time to material volume thresholds, not less.

Second, as we have shown previously, the story of spiking business applications is not confined to the United States. New business registrations have risen roughly 40% in Australia, 70% in Finland, and 80% in France since 2017, with meaningful acceleration in 2025 alone. Multicountry acceleration across...