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by programminggeek
4780 days ago
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It seems like the bigger problem they will have in their business is that they are going to be continuously busy "doing work" instead of "building the business". Such is the way of consulting. If you can't take on more work by hiring more people, then you can't scale. If you can't scale beyond the team you have, you haven't created a business, you've created a job. There's nothing wrong with creating a job for yourself, but know that it's not the same as a business even if you call yourself a business. |
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This meme has little entanglement with reality. A one-man consultancy's chief concerns are almost entirely alien to a W-2 employee's chief concerns: as a W-2 employee your chief economic objectives are work-performance, as a consultancy your chief economic objectives are almost certainly external to the actual delivery of your professional skills. A one-man consultancy can unilaterally offer themselves a pay-raise of 25%+ every 6 months if market conditions support it; this happens in vanishingly few salaried jobs. A one-man consultancy can build intellectual and other forms of capital which are absurdly portable; this is possible as a salaried employee but their access to capital formation is markedly inferior. (For example, it is exceptionally difficult as a salaried employee to licitly walk away with your employer's take on your core job function and then implement it for competitors. That's pretty much the default in consultancies, and deviating from it costs the client extra money.) A consultancy has significant work-related expenses in a way that a salaried employee does not. A consultancy has a vastly more complicated tax, compliance, insurance/risk-mitigation, etc etc, situation than a similarly situated employee.
Perhaps most relevant to someone who thinks headcount is the only meaningful way to scale things: a consultancy, even a one-man consultancy, even a one-man consultancy which outside observers believe is impossible of maturity required to scale, has a permanent call option on growing headcount.