How to build a startup while still doing web consulting

If you’re doing the hard yards as a web consultant, then I know one thing to be true. At some point in the last 12 months, you’ve considered writing an app and doing a startup instead.

Am I right? Don’t answer that – lets just agree that I am.

The dream is an enticing one. Revenue while you sleep, a global audience and no more clients to worry about.

37signals is the poster child of busting out of a web agency into a product based startup, and ever since then every web developer with a hint of ambition has considered doing the same.

We managed to achieve it by running a web agency for five years before splitting it off into a venture backed web startup. We took our experience of running a web shop and made a product, but it wasn’t smooth sailing. It took three or four years of missteps, wasted code, pivots, crap marketing, ignorance and about $300,000, but we got there.

Attendly screenshot

Would I recommend it as a path to get to your own startup? Hell no!

If you can focus 100% on your startup and dump consulting completely, do that.

Doing them both at the same time is so painful you’re going to want to stab yourself in the eye with a pencil.

Ask Paul Graham if you don’t believe me. In his article on ways to fund a startup, Graham wrote:

“The trouble with consulting is that clients have an awkward habit of calling you on the phone. Most startups operate close to the margin of failure, and the distraction of having to deal with clients could be enough to put you over the edge. Especially if you have competitors who get to work full time on just being a startup.”

So now you have at least two people telling you that creating a startup at the same time as doing consulting is a dumb idea, and yet here you are. Still reading.

Computer says no

Okay.

If you’re going to go down the path of whipping up a world class product while still servicing clients, then there may be a few things you can do to increase your chances of success.

And by success I mean launching a product. This should be your initial metric – actually getting something out the door without falling over or giving up.

IDEA 1: Half Days

Take half a day, every day, to just work on product. Close your email and take the phone off the hook.

Tell your clients what you are doing or leave them in the dark. Either way works, but if it was me I wouldn’t tell them. Let them wait a few hours before you call them back and talk them through how to add an attachment in hotmail.

(sorry – five years of client work can make a man bitter).

We tried the half day process at various times, and it kind of works and kind of doesn’t. You know yourself it can sometimes take a few hours to really wind up into total productivity for the day, which means that just when you get going it can be time to stop and move onto client work.

IDEA 2: Go to four days a week

We tried this as well, inspired by the semi-mythical “Google time“. Every Friday we worked on our own products, leaving the rest of the week devoted to the people who paid the bills and kept the lights on.

This works well in practice, but the biggest issue is that you are only spending one day a week on product. It’s not nearly enough. Even if you are producing the most basic MVP the world has ever seen, it still takes many days of solid programming, thought and design to push out something decent.

Going to four days a week works, but if you manage to launch your product in under 12 months I will personally nominate you as a national treasure.

IDEA 3: Outsource your product build

There are a number of websites such as Odesk and Freelancer where you can outsource the entire build of your product. Just fire up a browser, put together some specs and…

Haha. Sorry, just kidding.

You can’t outsource your product build if you are serious about doing a startup. Don’t be a muppet.

Beaker

Outsourcing client work on the other hand…

IDEA 4: Outsource your client work

Totally achievable! It depends a little on what the client work is of course, but if you are like a lot of freelancers or small web shops then your bread and butter is designing and coding websites. It’s not brain surgery.

This is probably the most successful strategy we implemented across the years in order to be able to focus on product. It can potentially free up your entire team to work on product for weeks at a time, with one person nominated as the project manager to keep the client projects ticking along.

Two big issues to keep an eye on are:

1. Profit margins get shot to bits. Freelancers generally cost more money than permanent staff, and budget overuns on projects are common. It’s easy to get to the end of the month and be in the red.

2. Deadlines on client projects are routinely ignored for startup work that is far more fun, resulting in large backlogs of work that you need to catch up on.

CONCLUSION

Maybe, just maybe, it’s a bad idea to attempt both and you should just pick one.

Whether you do it now or you do it in 12 months time, at some point you are going to have to choose. Do I do consulting, or do I take the leap into the unknown and build a startup?

Both can be equally fulfilling, it’s just a matter of working out which one is for you.