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As someone who ran a solo consultancy for a few years and probably was not exploiting myself, I think you're undervaluing what an employee W-2 consultant gets from their employer and also what the client gets from what you describe as the non-productive labor of the employer. When I consulted, delivery was only a portion of the package. Sales work isn't just "Convince the customer to buy the engagement", it often required substantial (and often speculative) work on creating proposals, doing client education ("Why should I even send email anyhow?"), scoping projects, attending conferences, writing publicly (an activity which is both marketing and produced substantial value despite not being directly billable), etc etc. Clients were not strictly buying delivery; delivery came with a bundle of requirements like e.g. having to deliver while being insured. This produces client value, because they sensibly don't want to give a commit bit to someone who could accidentally bring down the business and has no meaningful assets if sued. Warren Buffet will happily take that risk off the client's hands, to their happiness, but he won't do it for free. Clients similarly can't engage consultants without lawyers being involved. Lawyers materially de-risk engagements; de-risking is something both sides very much want; professional labor is not free. Clients benefit from receiving trade credit (the consultancy will advance you $60k of value and you pay them back months later, with no interest charged, minimal underwriting, and functionally no recourse in event of default); trade credit isn't free. From the perspective of a W-2 consultant, the things you get from the enterprise include having predictable work lined up by people who specialize in getting gigs and scheduling them so that you can focus on delivery. The set of technologists who can deliver is much larger than the set who can both deliver and convince software companies to pay premium rates for their time. (Trivial proof that this is true: look how many delivery-focused technologists say that business owners on HN are blowing smoke about rates clients are happy to pay every time that subject comes up.) The consultancy insulates the consultant from market risk; regardless of whether the consultancy is having a good month or a bad month in pipeline or cashflow management payroll happens on the day everyone expects it to in exactly the amount they expect it to. The consultancy invests in the professional development of their employees and in the specialization of their offering on the marketplace, which specialization increases the market value of their employees while at the consultancy and in the future. There is a way for delivery-focused employees to get ownership. It is to become a principal consultant. Some firms offer promotion tracks which get one there. The faster option, if a delivery-focused employee thinks that the enterprise is not adding value, is to walk out the door and hang out their shingle. If the delivery-focused employee was right, they immediately have 100% ownership of the enterprise. If they were wrong, oh well, capitalism happens to capitalists. |