Sure. So I had a client who wanted us to rewrite their 10 year old MS Access app as a web app.
The engineer in me would have immediately jumped into "OK, how do I migrate this database into Rails and recreate the functionality and UI of this app?" I would have priced the going rate for web development, and tried to gauge how long it would take to complete.
The business owner in me realized that this app is critical to their business. It's the tool they use to manage and close sales, and about 20ish people use it all day, every day. I also knew that the CEO was currently the maintainer of the app, as it was started when the company was a home business and the owner picked up a "Learn MS Access in 21 Days" book.
Knowing this, I went to work learning how I could not only modernize the product by making it web based, but I wanted to leverage my experience in usability to optimize how their team uses the app. How can we not just rewrite the app, but also optimize it? Is there a clear path to adding an hour or so a day of additional productivity per employee, and what would 100 hours of combined additional productivity a week mean (financially) for the business? And how much better would it be if the CEO of this small company wasn't needing to maintain the app himself, but could focus on what he does best — growing his company?
What I sold wasn't software or a rewrite. I ended up selling a better tomorrow for his business, and a more profitable tomorrow. This "decommoditized" what I was doing, and while he paid me a premium, he received a much better product at the end of the day.
> While he paid me a premium, he received a much better prodcut
n.b. That's how good business owners will look at this transaction: in terms of ROI. Sure this client paid a lot of money, but it was an investment in his company. It paid off. When you start framing offers like this, you don't have to feel bad about the price you'd like to charge because both parties come out further ahead.
Edit: Of interest to HN, I had a conversation with a business-owner friend of mine earlier this week. In trying to come up with a business ideas, I'd asked her if there was any software she hated using. This sparked an interesting conversation. When we got to the discussion about pricing, I asked:
"How much would you pay for something like this? $500 a year?" Her response was, and I quote: "I would do it on a monthly basis. Anything between 20-49/month is easy to sell. People <I think she means business owners here> don't even notice it."
tl;dr When you save a company money or time, they will hand you money accordingly.
This makes sense, but unfortunately not all clients are inclined into accepting propositions like these. Some clients do the research and design internally and then they hire a "consultant" to do the development part of the project.
I consider that the term "consultant" is used to freely and most of the time clients advertise that they are looking to hire a consultant when they actually want to hire a freelance developer.
If you want to work with them as "life support" for your practice while you figure out how to find the (innumerable) real clients that pay for business value, fine. But don't kid yourself. Call them "life support", not "clients". And just like a ventilator, staying engaged with life support is going to screw you up.
You cannot, cannot, cannot earn true market rates if your default position on incoming prospective business is "yes". You're going to say "no" a lot, and you're going to hear "no" a lot.
Fear of "no" costs more tech consultants more money than DOTA2 and Imgur ever will.
> I consider that the term "consultant" is used to freely and most of the time clients advertise that they are looking to hire a consultant when they actually want to hire a freelance developer.
For some bizarre reason, "consultant" has taken on in common use a meaning approximately equivalent to "contractor", which has nothing to do with whether the work being contracted for is consulting or not.
I really think the idea that "consulting" is some special thing that "contractors" and "freelancers" can't do is harmful. In the sense we all mean it, "consulting" just means "being smart about what services you provide and at what price". It's the equivalent of product management in a product company. If you're serious about being independent, you have to do it. Now.
> I really think the idea that "consulting" is some special thing that "contractors" and "freelancers" can't do is harmful.
Most consultants are contractors (whether they are also freelancers or not depends on whether they are individual contractors or are contracted firms), though there are some cases where internal employees job function includes consulting for some other internal group than the one to which they directly report.
But not all contractors (freelance or otherwise) are contracted to consult, and those that aren't contracted to consult shouldn't be called "consultants", in the same way that people that are contracted exclusively for tasks (including consulting) that don't include developing software shouldn't be called "software developers".
See, now I think you're using the term in a subtly different way than Brennan is. Brennan couldn't have sold that Access to Web conversion deal as a pure consulting project, in the Arthur Anderson "split up implementation and consulting" sense of the term.
Everyone working independent needs to think of the business value they're creating; they need to think about their services the way product managers think about Feature/Function/Benefit charts. We call the people who are good at this "consultants", even when most of what they actually do is (say) Rails apps.
Those aren't the only two options. In fact: they are both bad options!
Here's a much better option than either. I'm sure it's not the best way either, but the fact that "what came off the top of my business partner's head" is so much better than hourly or fixed is a good indication of how bad hourly and fixed are.
Charging by the day is better than charging by the hour, and week is better than day.
Better than each is to stop valuing your time as "just" time. You'll never have those moments again.
Value your work product. Don't value your work effort, and definitely not your time.
Actually, don't value your work product. Figure out how your customer values your work product and charge that price.
Once you start to realize that your time is the most valuable thing you'll ever have and simultaneously completely worthless as a unit of currency, you'll begin to trade with what you have that is truly of value to the person actually paying the bill: that thing you haven't created yet.
I was going to bookmark the linked comment, and found that I had in fact already done so. It is a very useful, actionable piece of advice. Thanks for writing it.
I bill by the week. At the time, my agency rate on this project was $10k a week, which included the full time attention of a senior developer (~4 full days), plus part time Q&A and PM oversight.
