Patrick's description isn't "good on paper"; it is a spookily accurate reflection of reality thorough enough that I, the Cliff Clavin of Hacker News, was unable to come up with a single thing to add to it, despite the fact that he is explaining my business model (I co-founded, co-managed, and co-scaled the consultancy I co-operate today).
The basic exchange between consulting management and labor is one of risk for upside. The returns from a consulting business can get very lumpy. An employee's income cannot be. They're promised a salary, presumably at market rate (else why take the job), and everything else is the company's problem. Hit a dry spell, employees keep getting paid, and principals don't.
At a well-run consultancy in a hot market (say, software security), there's not much incentive to squeeze employees, because recruiting and retention are expensive and because when you lose a consulting employee, it's often to companies that happen to be fierce competitors. So for instance, if you were instrumental to a deal here, you'd be eligible for the same kind of bonus compensation that the sales guy who closed the deal would be eligible for.
There's room in every business model for unscrupulous managers to somehow cheat employees. But if this million dollar contract you talk about was so clearly the product of your ability and execution, why did you need to be employed by design agency to deliver it? Why did you settle for the promise of a "bonus"? Or is it that, if not for you, some other consultancy would have won the deal, and also not given any of their employees a million dollars as a result?
We've lost team members who moved on to start their own firms. Chris Rohlf, now of LeafSR, was one of our all-time best consultants (and is one of the all-time great vulnerability researchers). With a few years experience running his own shop successfully, and dealing with all that entailed, I know what he'd tell you about whether he had a square deal at Matasano.
Not for nothing, but: if you're at a point in your career where you feel like you're make-or-break for million dollar deals that you yourself could close, maybe you shouldn't be working for a consultancy, and instead be running one.
The basic exchange between consulting management and labor is one of risk for upside. The returns from a consulting business can get very lumpy. An employee's income cannot be. They're promised a salary, presumably at market rate (else why take the job), and everything else is the company's problem. Hit a dry spell, employees keep getting paid, and principals don't.
At a well-run consultancy in a hot market (say, software security), there's not much incentive to squeeze employees, because recruiting and retention are expensive and because when you lose a consulting employee, it's often to companies that happen to be fierce competitors. So for instance, if you were instrumental to a deal here, you'd be eligible for the same kind of bonus compensation that the sales guy who closed the deal would be eligible for.
There's room in every business model for unscrupulous managers to somehow cheat employees. But if this million dollar contract you talk about was so clearly the product of your ability and execution, why did you need to be employed by design agency to deliver it? Why did you settle for the promise of a "bonus"? Or is it that, if not for you, some other consultancy would have won the deal, and also not given any of their employees a million dollars as a result?
We've lost team members who moved on to start their own firms. Chris Rohlf, now of LeafSR, was one of our all-time best consultants (and is one of the all-time great vulnerability researchers). With a few years experience running his own shop successfully, and dealing with all that entailed, I know what he'd tell you about whether he had a square deal at Matasano.
Not for nothing, but: if you're at a point in your career where you feel like you're make-or-break for million dollar deals that you yourself could close, maybe you shouldn't be working for a consultancy, and instead be running one.