The Numbers: One Year into a Solo Consulting Business
I’m a little late to the 2023 recap party, so we’re keeping this one brief.
Brief, yet informative.
The last 4 months have been surprisingly eventful from a professional sense, and it continued all the way through the New Year.
In fact, it’s continued into the new year. I was not expecting that.
Here is a snapshot of my almost first calendar year working for myself and consulting in the data engineering space.
Rather than waxing poetic about life as a solopreneur, I’ll try to keep it pithy.
Projects
~35% Greenfield/ New
~55% Brownfield/ Existing
~10% Non-Development
I’m not surprised by this mix, but the way these project play out differ greatly.
Greenfield projects are seldom truly greenfield. Someone internally has run a POC, convinced management, or decided that XYZ thing needs to get done.
I expect a larger chunk of Brownfield projects in 2024 - companies have no shortage of problems to solve. And coming off the ZIRP-era heyday for data tools, I expect many companies will realize that there is plenty of low hanging fruit with regards to cost-optimization and performance improvements.
In case you didn’t know… you don’t need to throw more money at your problem to solve it. Sometimes, you just need someone who’s seen it before.
Customers
~20% Referrals
~20% Inbound
~20% Repeat
I can’t share all the details here for obvious reasons (read: contractual) . But of the wider range of customers I worked with this year, I’m very happy that 1) people within my network are willing to vouch for me, 2) things I say on the internet are taken seriously (by some) and 3) customers recognize I can help solve their problems.
You know what they say - the easiest customer to sell to is one who's already paid you.
50% of my clients are Venture-backed businesses, all providing some SaaS solution.
The other 50% were bootstrapped or spinout companies.
Timing
Shortest Duration Project: 3 Weeks
Longest Duration Project: 6 Months
Shortest Time to Close: 1 Day
Longest Time to Close: 4 Months
If I had to guess, the typical project duration was 3 months. Not bad.
I’ve learned I much prefer to come into an organization with a specific problem to solve over doing a “staff aug”-like engagement where I am embedded on a team.
Project based engagements still mean working closely with the existing team. But, the markers of success (and sense of urgency) when working as an outside expert are much more concrete than when you’re a hired-hand picking up To-Do’s from the Kanban board.
Money
Price Increases: 2
Profit Margin: 91% (Lol)
Yes, bootstrapped service businesses have low overhead. Yes, 91% is ridiculous.
There are only 2 options to scale this business - prices and people. While I’ve managed teams before, I am not confident the economics work when it comes to hiring additional hands. Sub-contracting, however, is a different story.
By the time I am officially one year into this ride, I will eclipse my previous full-time salary by a meaningful margin. I still have a couple months until I reach that milestone.
A More Personal Note
The biggest news this year wasn’t starting Purview Labs.
We got a dog - a rescue from a farm in South Texas. His name is Phil. He sits next to my desk when he wants pets, runs in circles when he’s excited, and sometimes looks goofy in photos.
I tend to keep my business persona separate from my personal one, at least when it comes to my online presence.
I don’t think that’s totally feasible anymore. Nor is it necessarily good for business.
I may be sharing a bit more about this side of life in 2024. Maybe.
Misc. Observations
I work almost every day in some capacity. I don’t wear myself thin, but it’s part of the journey right now. I’m not sure this approach is for everyone, and I’m not sure this is something I want to do for the long-term.
Long-term consulting work is still not the end goal. I find myself debating the merits of selling a product vs selling services.
Both can be wildly successful and, if done right, complementary offers.
I’ve expanded my network more in ~ 10 months of working for myself than most of my W-2 roles. Conversations are different when you come into them as your own brand rather than someone who does XYZ thing at Some-VC-Funded-Startup.
Content works.
Creating content is time consuming.
Creating useful content even more so.
Content about tools and technologies get significantly more readership and engagement than content about business. The data world has perpetual shiny object syndrome.
Tools like ChatGPT are not going to replace engineers. But they do help flatten the learning curve of new things. Mastery is only ever achieved through practical application of knowledge, though.
The difference between the Airflow and Dagster dev experience is night and day. I discounted Dagster for too long.
I haven’t been Duck-pilled, but DuckDB has its place in specific workflows. It is not a magic bullet, but it is a useful open source technology.
The broader data ecosystem is following a similar arc to that of the “internet marketer”. Lots of online course. Lots online personalities. It can be tiring to sort through the noise.
I still don’t have a company logo or branding. And I’m not sure I need one
If you made it this far, give me a shout on Twitter or LinkedIn. One of my favorite parts of the last year has been talking to new people.
Very insightful. If possible could you please share type of projects (building infra, migrating to a new one, etc) and clients profile (big co vs small/mid sized companies).