Consulting sucks, but thanks for the work
Starting a company is tricky because there is never enough money. There are ways to raise money, and ways to save money, but usually you are thinking about both of those things because money is tight.
At the moment, I’m doing quite a bit of consulting work to give my company a cash infusion. And this is working quite well. Luckily, the projects are interesting and the clients are delightful to work with. (They also read my blog!) Most importantly, the money is coming in.
But although I love my consulting jobs half the time, the other half of the time I despise them. Because every day, every hour, every minute that I spend doing my best work for my clients is time that I take away from working on my start-up.
I consider this to be a necessary evil at the moment. But the process of getting these consulting jobs and using this capital-raising strategy has given me some insight into how to make the process more painless than painful.
My most recent article on The Industry Standard has the full scoop, so go read it now to find out more - Consulting for capital - 5 ways to make it work for your start-up.
These are the five points that the article covers:
1. Charge by the hour
2. Watch the contract terms
3. Learn from the work
4. Network
5. Schedule around your busy times
What strategies do you use to make consulting a positive capital-generating tactic for your start-up?
Tags: entrepreneur, raising money, start-up, The Industry Standard
May 22nd, 2008 at 2:29 pm
The ideal way to fund a startup with consulting is for the consulting to be directly related to the product you’re building. I had the exact same feeling you have about pay-the-bills consulting before we were ready to use, but once it was ready we put a professional services consulting business around it and had instant profitability. Making the next jump to a subscription or ad supported model seems harder though.
May 22nd, 2008 at 8:50 pm
A general answer is to set oneself a timeline - eg, I will only continue this consulting work for six months.
If you can stick to this, as time goes by it will ensure you are increasingly focussed on your start-up. Lack of Money is preventing you from committing to your business; a strict timeline you hold yourself to will force that commitment.
If, after that appropriate period, your start-up hasn’t gone anywhere, then you weren’t committed enough. Whether that’s to do with you or because your start-up idea didn’t fly is a topic for another post.