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Ask HN: What is your experience in tech consulting?

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Re: Ask HN: What is your experience in tech consulting?

#71

Post by throwawaybbq1 »

MrFoof wrote: post #12
GianFabien wrote: post #9

Earlier quoted context omitted.

Not only will I not do pro-bono work, but getting paid in full and on time is a challenge. Even good clients can suddenly ghost you and forget to pay up.

Don't forget the larger companies who'll try to negotiate Net 90, one month in arrears, in which they'd still probably feel they had another 2 weeks of wiggle room. Companies try that. With me it ends up Net 30 as usual when we edit the service agreement, but lordy do they TRY that. Which is why you need airtight service agreements, and then the willingness to follow up on them. Obligatory video, "Fuck You, Pay Me":…

This is brilliant!! Thank you for sharing.

I had no idea who this guy is, and the talk series. How much field-relevant brilliant content am I missing?

Re: Ask HN: What is your experience in tech consulting?

#72

Post by phphphphp »

michaelt wrote: post #70
tptacek wrote: post #19

Earlier quoted context omitted.

I would push back on a lot of this. These seem like strategies to avoid getting ripped off by shitty clients, and I'm sure they work, but they're also a strategy to avoid closing business with great clients. Try to focus on the kinds of customers you won't ask for down-payments and up-fronts --- the kinds of customers who will routinely delay a full quarter or two on payables, and you'll put up with it, because they'…

> Try to focus on the kinds of customers you won't ask for down-payments and up-fronts --- the kinds of customers who will routinely delay a full quarter or two on payables, and you'll put up with it, because they're paying for several people's salaries, Must be nice to have so much money in the bank that not only can you pay 6 months of several people's salaries, but you can also tolerate the risk of the client not…

That's the benefit of working with high-paying customers!

Re: Ask HN: What is your experience in tech consulting?

#73

Post by davedx »

michaelt wrote: post #70
tptacek wrote: post #19

Earlier quoted context omitted.

I would push back on a lot of this. These seem like strategies to avoid getting ripped off by shitty clients, and I'm sure they work, but they're also a strategy to avoid closing business with great clients. Try to focus on the kinds of customers you won't ask for down-payments and up-fronts --- the kinds of customers who will routinely delay a full quarter or two on payables, and you'll put up with it, because they'…

> Try to focus on the kinds of customers you won't ask for down-payments and up-fronts --- the kinds of customers who will routinely delay a full quarter or two on payables, and you'll put up with it, because they're paying for several people's salaries, Must be nice to have so much money in the bank that not only can you pay 6 months of several people's salaries, but you can also tolerate the risk of the client not…

Yeah managing cashflows is a huge part of running a business.

You really have to plan to deal with things like this because it will happen.

This is exactly what revolving/lines of credit are for. Talk to your bank.

Source: have seen a business growing who had to deal with this. There is no way - no way in hell - you can scale a real consultancy business using escrows and ditching clients as soon as they don't pay. It's just not how most of the world works.

Re: Ask HN: What is your experience in tech consulting?

#74

Post by varjag »

tomhoward wrote: post #54
tomhoward wrote: post #13

Have a read of this classic post by patio11: https://training.kalzumeus.com/newsletters/archive/consultin... I can testify as to the troubles that flow from doing work for discounts or gratis; I'm currently four years into a client relationship where I started out by helping them out of a desperate situation with a cut-price block of work, then they've continued to build their business on the basis that I (or other c…

Just a further comment on this - As tptacek pointed out above, favours/karma can go a long way, so it’s not necessarily the case that you should never do anything for a discount or pro bono. It’s a matter of setting the right expectation. If you’re doing a favour, make it clear that that’s what it is and what the limits are, and avoid letting that become the expected ongoing deal.

If you feel like doing a favor, it's best to still send a full amount invoice with a separate discount line.

Re: Ask HN: What is your experience in tech consulting?

#75

Post by michaelt »

csomar wrote: post #52
8note wrote: post #26

Earlier quoted context omitted.

> Try to focus on the kinds of customers you won't ask for down-payments and up-fronts --- the kinds of customers who will routinely delay a full quarter or two on payables, and you'll put up with it, because they're paying for several people's salaries, and the people you work with there don't control the accounts payable people to begin with. Can't you just volunteer for these companies instead? If the need free wo…

You don’t get it. Some companies (bigger ones) have their accounting department operating independently from their development/IT department. This is not the case for small businesses which the OP is softly suggesting not to work with. Clients with such departments will pay if your invoice is approved. The payment process is disconnected from the team you’ll be working with. It also happens that the team you work wit…

> The process is slow, so bear with it and price for the delay of the funds.

Every large company actually has two parallel ways of paying.

There's a main procedure which is extremely slow, because getting a 6 month interest-free loan from your suppliers is free capital, and maybe the supplier will forget and you won't need to pay at all which is free cash, and to access these benefits all you need is a smaller accounts payable department. They will be overjoyed to not pay you because you didn't submit form AB-1234 confirming that you have a policy on modern slavery. And they absolutely will not chase you for that form.

Then there's a parallel procedure, where your contact asks their boss's boss's boss's boss and the bill gets paid by credit card within the hour.

Having a reasonable amount of flexibility is fine - but at any time that friendly, helpful, trustworthy contact you're working with could change jobs, the project could be cancelled, or the project could end successfully and all your contacts get reassigned.

You don't need to extend so much credit that you'd be put in a difficult financial situation were they not to pay - if the client has reached their credit limit, and they are late on payments they're contractually obligated to make, you just need to get your contact to trigger the fast procedure instead of the slow one.

Re: Ask HN: What is your experience in tech consulting?

#77

Post by csomar »

michaelt wrote: post #75
csomar wrote: post #52

Earlier quoted context omitted.

You don’t get it. Some companies (bigger ones) have their accounting department operating independently from their development/IT department. This is not the case for small businesses which the OP is softly suggesting not to work with. Clients with such departments will pay if your invoice is approved. The payment process is disconnected from the team you’ll be working with. It also happens that the team you work wit…

> The process is slow, so bear with it and price for the delay of the funds. Every large company actually has two parallel ways of paying. There's a main procedure which is extremely slow, because getting a 6 month interest-free loan from your suppliers is free capital, and maybe the supplier will forget and you won't need to pay at all which is free cash, and to access these benefits all you need is a smaller accoun…

I'd say landing such a company already require an internal or initial contact there. In case that contact does not exist, I'll tread careful like I am working with a black box. You'd have to navigate their bureaucracy somehow and a big company will have a reputation for such things (either good or bad).

The contact, depending on your friendly terms with him, can shed light on how these processes work and what to expect. It's up to you to determine if it's worth your time/effort to pursue working with them. Everyone has a different sweet spot.

Re: Ask HN: What is your experience in tech consulting?

#78

Post by reuven »

I've been consulting since 1995. I started with a lot of different things (Web projects, Unix system administration, tech consulting), and now do 100% Python training.

I am incredibly happy with my work. I get to do what I want, earn a good living, have almost zero meetings, and am constantly learning new things.

But I made many, many mistakes along the way, leading to years of so-so income, limited sleep, and limited time with family.

My biggest mistake was trying to do too many different things. By focusing on one type of problem, you'll gain expertise (useful when helping clients). But you'll also gain a reputation for solving those sorts of problems, and clients will start to find you.

You still need to learn how to market yourself. You need to learn how to ask for money (which I found hard). You need to get a sense for who will stiff you (and some clients will!).

Indeed, a big problem with many consultants is that they forget they're running a business. When you're an employee, you can ignore all of the business stuff; you get a paycheck, and someone takes care of all of the little and big things, from invoicing to taxes to contracts to angry clients. When it's just you, you get to do all of that.

You can take a look at the podcast I do, the Business of Freelancing: https://businessoffreelancing.com/ (We'll hopefully start to record a third season in the coming weeks.)

Beyond that, I strongly recommend Philip Morgan's "Positioning Manual," which can help you figure out just what niche you want to enter.

Best of luck! And remember: If consulting doesn't work out, you're not a failure. It's not the best match for some personalities, markets, places, and times. But if you can make it work, then power to you, and I wish you the satisfaction and success that I've had.

Re: Ask HN: What is your experience in tech consulting?

#79

Post by larve »

pjmorris wrote: post #57
cik wrote: post #16

Just a few random thoughts from ~10+ years of doing this. These are not ordered, as I've been out of this for the past few years. - Contracts, contracts, contracts - Immediately stop all work when any customer doesn't pay an amount owed. There's a natural inclination to keep going, but this is a firm of pathetic cost fallacy. - Work with an escrow provider and eat the fees. You'll generally have a 10% non-collectable…

> - Never price at the top of the market. It's better to be 100% busy at 80% of the fee structure, than it is to be 50% busy, at 125% of the base rate. I tend to favor this line of thinking most of the time. But sometimes I'd rather be 50% busy, and pricing is one way to influence that. It is worth understanding the power and purpose of pricing. My favorite discussion of pricing for consulting is a chapter in 'Secret…

While I’m not in the consulting business per se, that book is a goldmine just about the topic of giving advice as well. Highly recommended (as is anything by Weinberg)

Re: Ask HN: What is your experience in tech consulting?

#80

Post by cies »

varjag wrote: post #74
tomhoward wrote: post #54

Earlier quoted context omitted.

Just a further comment on this - As tptacek pointed out above, favours/karma can go a long way, so it’s not necessarily the case that you should never do anything for a discount or pro bono. It’s a matter of setting the right expectation. If you’re doing a favour, make it clear that that’s what it is and what the limits are, and avoid letting that become the expected ongoing deal.

If you feel like doing a favor, it's best to still send a full amount invoice with a separate discount line.

Always nicely wrap a present, and present it as a present.

Never let a present (favor) go unnoticed.

Discount lines are IMHO the way to do this.

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