Can You Make It As A Solo Consultant? (The Poster Child For Career Reinvention, Part 2)
Some clients tell me they’re jealous that I get to work for myself, make my own schedule, and not have to deal with office politics. My response is always that being an independent contractor works well for me, but it’s not for everyone. Yes, I do like making my own schedule and not dealing with the energy involved with managing others and being managed. However, different stresses come with the consultant’s life: sustaining lucrative contracts, dealing with exhausting business trips, feeling hopeless when clients’ budgets are slashed, staying up-to-date with technology trends, etc. For me, though, that stress level pales in comparison to the stress I had felt when I was accountable to a manager.
And as a lifelong Crohn’s patient where so much of what I have to deal with is beyond my control, I like to feel that I can be in charge of something.
Keep reading for five questions you need to answer if you’re going to pursue a solo route. But first let me tell you how I got into the game.
I never had a grand plan to be a consultant. After I got my MBA I had two consecutive corporate jobs, which both seemed like the right moves at the time. I had studied real estate finance at Wharton, so I was a bit narrow-focused about only wanting to pursue jobs in that industry.
My jobs were OK, but I had frequent crises of conscience about how I wasn’t doing anything for mankind. Less existentially, I was hospitalized twice in my first year after business school, potentially because of the brutal stress of my job and my reluctance to seek support. Still, I hung in there until the second company I worked for went bankrupt. I was in total denial about pre-bankruptcy warning signs: senior management stopped talking to anyone; the strategic plan changed almost daily; my boss was transferred to a new location, where she focused almost solely on how the office would be decorated; my newly hired boss had had only had one previous job in the industry, and he kept repeating in his thick accent that the investments he wanted to pursue were going to be all about, “za peepull.” He never actually met any “peepull;” he just seemed to like the idea of them.
The day that company imploded I immediately called my very pregnant wife, who met me in front of 30 Rock. I was ready to call a recruiter to help me schedule meetings with other real estate firms, when my wife told me to chill out. (Note to readers: In every one of my life stories, the phrase “my wife told me to chill out” appears at least once.) I had been performing in theatrical productions on the side, and she recommended I take a work hiatus and try to make a go of it professionally.
Which I did. And I did pretty well, but I started to get very frustrated with the downtime between jobs even though I did get to have great hang out time with our infant son. Within a month or so a good friend got a job in the new management communication program at Columbia Business School, and she asked me if I’d be interested in conducting some workshops for business students on interviewing and presenting. I hired a babysitter and filled up my schedule. It was a great solution for me- I was good at teaching, I loved having an audience, and I had nice schedule flexibility.
After a year or so I told some business people I knew what I was up to, and I got some nice executive speech coaching assignments. With my confidence growing, I networked more, and soon I was asked to be a subcontractor to a consulting firm as a speaking and writing coach and trainer to a global institutional equity research team at a top money center bank.
That gig was a total game-changer. I learned to be the expert in institutional research communication and eventually became the go-to consultant in that niche with most investment banks. I continued to network with people in other divisions at each bank, and people would contact me when they moved to different firms, asking me if I could work with new teams. I eventually branched out internationally and then started coaching portfolio managers — clients of my “sell-side” clients — on how to pitch their funds to institutional investors, and coaching investor relations and C-suite teams of many public companies. One more point, then enough about me. Since I was initially a subcontractor, a situation that quickly changed to full contractor independent of the consulting firm that brought me on, my fee had already been negotiated. I didn’t have to do an analysis of what other people in my situation were charging; I just continued to use the same fee structure.
Don’t think about going solo until you’ve considered your life situation and appetite for risk. Now back to the question I’m asked about whether someone should go at it alone. Your first consideration is where you are in life- partnered, solo, parent — and how much money you’ll need to feel comfortable. If you have a spouse or partner, be honest with each other about how you’ll both feel about potential income uncertainty. Check with a financial planner or use online resources to determine how much financial cushion you should have during down periods. Also remember that if you’re thinking of buying a house, know that mortgages are easier to procure if you demonstrate a strong track record of solid income.
And here are the two absolutes that I reminded my own children over and over again:
Don’t go into credit card debt. Ever.
Make sure you have health insurance. Always.
Can you solve a problem people will pay for? If you’ve watched shows like “Shark Tank” you probably noticed that the best presenters have clearly thought out a unique business solution that solves a problem, identified a target market, recognized competitive threats, and calculated growth potential. On TV and in real life, success often depends on presenting the idea with clarity and enthusiasm and answering questions naysayers will likely have. So here are my five questions you should ask yourself before hanging a shingle.
What problem can you help people solve? Try to be as specific as possible. During my training sessions on persuasive pitches I have people focus on three broad categories that I call The Three Ps: profitability, productivity, and prestige. Profitability refers to anything that has to do with money: for example, will your clients ultimately make or save money by using your service? Productivity refers to anything that makes life easier: for example, will your clients be more efficient or save time. Prestige refers to anything that makes people feel good: for example, will your clients jump ahead of their competition or make their employees happy?
What’s your niche? It’s nice to think you can offer a lot of things to clients, and perhaps one day you will, but at first focus on an area that gets your foot in the door and leads to a nice client list. You’ll be able to broaden your scope once clients appreciate what you’ve done for them.
What’s your credibility? Think about what would convince you to hire one furniture mover over another. If the costs are the same, you’d might go with someone who has the best reputation, who has worked with people you respect, who has the most licenses and certificates, who knows about legal issues you didn’t know existed, and who demonstrates a strong sense of trust. So make sure you consider how to up your credibility level to fit what you know your clients will care about.
What will you charge? I hate talking about billing, but you need to do some research among people you trust. Perhaps you can test the waters by asking former colleagues what they would pay for your services or what they’ve seen other similar consultants charge. Also, I’m not from the generation that shares information on how much people make, but you could ask some fellow consultants to share their typical fee structures.
How will you get the word out? When I started out as a consultant people were just starting to use email as the primary mode of communication, but we mostly relied on phone calls. My strategy was to ask the clients who valued my work for names and numbers of people they thought I should speak to. I knew what my quick intro would be on a phone call or voice mail, and my return rate was pretty good. I still am a power networker: always looking for connections, seeing what people I know are doing, getting ideas from websites, adding contacts to LinkedIn, writing articles, and promoting ideas in various ways. In today’s world of social media I have hired many consultants (web designer, adwords analyst, SEO pro, video consultant, publicist, etc.) to navigate the best route for me.
The grass is sometimes greener. Since I started my practice I have truly enjoyed working solo. There was a time early on when I asked myself, “What’s wrong with me that I can’t work for someone else like a normal person?” I couldn’t believe I was answering NO in the “Works Well With Others?” item in my purely mental self-assessment questionnaire. I mean, I really do work well with others, but I guess it just came down to the fact that I don’t work well with others who boss me around.
I know people who are fabulous consultants, but get stressed out by even the idea of self-promotion and networking. And that’s totally fine; the stress of going solo may be greater than that of working for others. No one gets off stress-free, but I’m a poster child for trying to maintain some control of my life in an often uncontrollable world.