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I charge by the hour and will never change. It forces the customer to focus on getting the requirements right instead of hand waving it like "oh yeah, that's j

I charge by the hour and will never change. It forces the customer to focus on getting the requirements right instead of hand waving it like "oh yeah, that's just what I want" and then come back later "I didn't want that, what I meant was" repeat ad infinitum. You see they are paying for my time, not results. If they choose to waste it... doesn't matter to me, it's all billable just the same. I will do my best to steer them in the right direction to save time and money, but you'd be amazed how often they need to learn the lesson the hard way. I also don't compete, I'm not on any "freelancing" websites, I don't apply or bid for work. My clients always come to me, I get an email, a phone call asking if I'm available. So this race to the bottom nonsense is utter crap. I'm a consultant NOT a freelancer. I've been doing this since 2011, that's the last time I had an employer. This year I'm on track to bill out between $360k and $400k. If that's "amateur" so bet it. Considering I have no debt, my house is paid for, my luxury SUV I paid cash for, my actual monthly bills are around $2,500 a month. I really couldn't care less what someone who writes an article like this thinks of me. The writer is advocating for the client, they aren't giving me advice that helps me. I also have no interest in scaling, on bringing on employees. I'm making bank, I left CA in 2013, currently live in Wyoming with a 40 minute drive to Park City UT and a 60 minute drive to Salt Lake City. To anyone reading this article and thinking they are offering you helpful advice, consider their motive. What are they trying to sell you? Are they trying to change the current consulting landscape to benefit themselves as a business owner?

mmckelvy 3y ago
What kind of work do you do?
hello_moto 3y ago
I see that your niche is in C/C++ world (with some Obj-C), low-level stuff. Mind if I ask how's the market and what kind of clients (companies?) that you worked with? If you don't feel comfortable sharing the list, would you be able to share some hints? Out of curiosity because my background in college is more towards System programming but life puts me as a full-stack and backend/cloud engineering. Gettin a bit tired with too many backend tech (too many different storage solutions, backend languages, etc)
- ChristopherM 3y ago
  Most of my clients tend to be Medical Device startups, but I did have a really long relationship with a major food manufacturer. While it makes sense for them to hire full time software engineers for some of the work, they always have a hard time finding device driver experts. Also they tend to attract less experienced engineers, so having me on board helps to manage and mentor their team. And I'm generally the one laying out the architecture and breaking the project into smaller parts so their engineers can implement it. If you want to break into consulting, you have to figure out which field you want to be in. I'd avoid anything that has a boot-camp available for it, that's a race to the bottom. Then you need to get at least 10 years experience working in the field, preferably at a variety of companies, and make friends and business contacts at each place.
  - hello_moto 3y ago
    Thanks for the insight. I have 10+ years working experience mostly in Cloud (think Java/GoLang/Python, AWS, Kafka, DB backed system, with 4+ years in front-end JS). Less experience in device-driver/OS development, system programming. I'm definitely interested to explore Linux/FreeBSD/Kernel or Device Driver type of work for fun. Would be great if I can make a living. Would also love C++ experience, but prefer not writing AppServer bizlogic type if possible, I'd rather do it in another platform.
ryanjshaw 3y ago
> This year I'm on track to bill out between $360k and $400k > To anyone reading this [post] and thinking they are offering you helpful advice, consider their motive Honestly I'd be happy to sign up to your newsletter and be upsold into a private $20/mo high-end consulting community forum if I were to learn how to earn those kind of numbers and I was disappointed you didn't.
- ChristopherM 3y ago
  I started "programming" in 1982 on a VIC-20, I taught myself C++ in 1991 and programmed as a hobby until I switched majors in University. Then I moved from Job to Job once I stopped learning/progressing. Along the way I made many contacts at a diverse group of companies. I started at a medical device company reverse engineering MRI/CAT scan data for a 3D device used in brain surgery. Then I worked for a company that specialized in Bug Tracking and Project Management. Then a company that engineered optical archival storage discs with a 100 year life span. Then I managed a team developing a video keno/poker gaming machine that was available to the Nevada/Montana market. Then I managed a team in reverse engineering cell phones for forensic analysis. Then a medical company that made a continuous glucose monitoring system for critical care environments. After 1 year working on their firmware, I was brought back as a consultant to rescue the Software department as a Director of Software Engineering over product and manufacturing. Through all these jobs I was well liked and since then have been contacted by people I used to work with for consulting work. And now I'm getting consulting work from other consulting job referrals. I currently charge $180 an hour plus expenses, but come January 1st will be raising it to $200 an hour because of the inflation and the fact it's not stopping. In terms of stating new increased prices; through the years I've informed clients to have them tell me it's too much. Then 30 days, 9 months come back and just sign a new contract at the new rate. You have to be willing to walk away, you have to have money in the bank so you don't "need" their work, but would be happy to if they pay your going rate. Just be professional, explain that you could be making more doing work for another client and it's "just business". I specialize in device drivers Windows and Linux, firmware, embedded RTOS and even desktop applications, mostly Windows but also can do some Qt on linux. My favorite language is C++ but frequently use C as firmware and linux device drivers are written in C. I also have quite a bit of experience managing, hiring, extracting and documenting software reguirments, architecting and implementing as necessary. As for getting new clients, I tend to pick up a client for 3-6 months of work and still do work for them 6+ years later. In the beginning they get most of my time, later I end up sitting in on weekly meetings, reviewing their code/design, mentoring their junior level software engineers, and helping them to hire more as needed. I end up standing in as their CTO/director/senior manager as they usually don't have the funds to hire a full time one.
the_lonely_road 3y ago
I clicked on you because I was curious and noticed your bio says you live in Nevada still if you care.
- rootusrootus 3y ago
  And not just anywhere in Nevada, but Incline Village. Pulled that up on Redfin and I can see why someone would be tempted to brag.
  - jedberg 3y ago
    Incline Village is the closest you can be to the Bay Area and still live in Nevada. It's where a lot of tech folks go after they exit or if they get a remote gig because then they don't have to pay income tax, but are only a 3-4 hour drive to SF if they have to go in. It also has great schools. So you end up with a lot of moneyed California ex-pats there.
    - dragonwriter 3y ago
      > Incline Village is the closest you can be to the Bay Area and still live in Nevada. Factually, no, its not: Stateline, NV on the south shore of Lake Tahoe is 15 road miles closer than Incline Village on the north shore. About similar drive time, though. Incline Village is swankier though.
      - jedberg 3y ago
        Not in the winter. 50 can get closed for days, 80 is always plowed. Closest in terms of average time throughout the year.
- ChristopherM 3y ago
  I haven't made a post in years, I'll update my bio. I didn't realize it still pointed to Incline Village.
poulsbohemian 3y ago
Here's the challenge I ran into, so I'm curious how you handle it... If you bill by the hour, first they fight you over the hourly rate. Then they want to argue over how many hours it will take to do the work. Then they want to argue over you billing them for all the project management and planning hours you are spending with them, they only want you to bill them for "the work." Then when they get the bill they want to argue over the hours you bill them. And before anyone says "find better clients" I found this in everything from Fortune 500 to mom and pop. And Fortune 500 is net-180 regardless of what's in the contract. I was spending so much time in this kind of BS that I went to a monthly retainer model. You get access to me, but you are doing so in a way that we can both set aside haggling over hours. For the smart clients it was a great deal and it saved me a whole lot of accounting overhead.
- chrisoconnell 3y ago
  Have you considered a monthly retainer with an hour cap? This prevents you from being treated like a salaried employee, maintains your work life balance, and ensures the client is still providing solid requirements and thinking through their ideas. We have found a lot of great success with this model, and our clients respect it. It ensure we can have multiple clients, without one taking up all of our time, and taking it from others. If we spend under X hours, that's fine. But there's simply a cap. It essentially means that each client gives enough work for us to work for those total number of hours, and we still have MRR regardless. We can help our clients maximize usable time, and it makes our project management valuable to the client as well. To combat long Net Terms, you can kickoff a client with a project, which begins upon receipt of payment, and is continued with the retainer. This initial project should be able to support you until your retainer payments start (180 days in length) but your retainer should start ASAP. It also allows the client to see your value, and you get to feel the client out.
  - poulsbohemian 3y ago
    At this point in life, I've moved on to a new field altogether, but some of the ideas you are sharing above are exactly the types of models I experimented with.
neals 3y ago
I'm a lot like you, I started out that way. Over time I added 4 good developers to my team and now have a steady flow of almost steady income.
deleted 3y ago
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tptacek 3y ago
"Amateur" isn't the word I would have used, and I think the author sabotaged his point by using it. What I would say is, you're leaving a lot of money on the table and donating a lot of cortisol to entities that don't need the money or the cortisol donations, because they're not spending their own money, and the high order bit of their success criteria is "I was able to plug money into this interface and make a business thing happen within the planned time period, without adding any headcount". The other place I disagree strongly with the author is about the utility of flat-rate projects. I've had good luck with flat rate, but it was never the project structure we'd have used by default. Rather: for any project we did, we'd have quoted a full project, broken out into billable weeks, with a final sticker price and a paragraph below the pricing table with "additional work needed will be billed at our pro rata day rate". I think the attitude that says "all the risk should be borne by the client, not the struggling independent consultant" is bad business (for high-end tech consulting, you should start seeing your practice as being in part in the risk mitigation business!), but that doesn't mean you need to take on extra risk just for the hell of it. That said, there are clients who are so valuable, because they're going to be repeat-business house accounts or because their reputation is so strong that they'll bring in word of mouth business automatically, that you should definitely consider just doing flat rate projects for (if that's what they want) and just eat the overages.
pdonis 3y ago
> It forces the customer to focus on getting the requirements right This is an issue that the article does not address, and it should. Part of the business risk that the article is talking about is the risk of ill-specified requirements from the client. But that means that any flat-rate pricing has to price in the extra time and effort required to make sure the requirements are well specified (and that's true even if a fair amount of that time and effort happens before a contract is signed--you still need to recoup those costs somehow). Either that or you simply have to not take on clients who can't specify their requirements well enough up front. > consider their motive I agree, this is always a good thing to do.
deleted 3y ago
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jedberg 3y ago
More power to you, but I stopped charging by the hour a long time ago. I charge minimum by the day, and offer a discount if you buy a week. I still bill for my time, but I avoid haggling over how many hours something took, and it also saves me the trouble of tracking my hours. You book me for a day, you get me for the whole (at least) eight hour day, however you want to spend that time. You book me for the week, you get me for at least eight hours each day for a week. I also do by the project billing, where I estimate how much work something will be, and pay on milestones. That requires a lot of up front work defining the deliverables in a way that avoids scope creep, but I also build in an overhead for scope creep so that I can "comp" them some deliverables that weren't covered, and everyone is happy. But the most important part is that the price is always agreed upon up front. The biggest issue with hourly billing is that neither of us knows how much the contract is worth until afterwards.
- swader999 3y ago
  How do you deal with clients that perceive and expect to have you available and working more than eight hours a day? What do you do about when your not immediately answering during lunch etc. What do you do about days where you detect l weren't fully engaged by the client for a full eight hours?
  - swader999 3y ago
    "The biggest issue with hourly billing is that neither of us knows how much the contract is worth until afterwards." You still don't with daily billing.
    - jedberg 3y ago
      I know with daily billing because they can only book me for a set of days in advance. It's not ongoing. We agree ahead of time on the specific days I will be there/available.
      - swader999 3y ago
cushychicken 3y ago
Billing by the hour seems to focus your clients clearly in a way that being their salaried coworker just does not.
hermanradtke 3y ago
> It forces the customer to focus on getting the requirements right instead of hand waving it like "oh yeah, that's just what I want" and then come back later "I didn't want that, what I meant was" repeat ad infinitum. This is amateur because you are leaving an insane amount of money in “change orders” on the table. That is fine if you don’t want to do it, but it is sub optimal for maximizing your revenue stream.
gregjor 3y ago
You interpret a free opinion article that addresses a general topic as directed at you personally, take offense, then ad hominem question the author’s motives. He’s doing a little self-promotion, as you do and we all do online, but he’s not trying to “change the current consulting landscape” to benefit himself. Whom do you think reads his articles? None of my customers will. It should go without saying to non-amateurs that exceptions happen, no general advice fits every situation, and your mileage may vary. Then you boast about your own success. You don’t add anything to the conversation, offer no meaningful critique. Good for you with the high earnings and luxury SUV. For most freelancers (or consultant if you prefer, clients don’t care how you style yourself), especially the amateurs just starting out, the article addresses a very real set of problems. Those less experienced freelancers do face a race to the bottom as commodities. The article might help them think about how they position themselves and structure their projects so they aren’t struggling on freelancer marketplaces. If readers take nothing else away from the article they might think about adding business value versus selling their time, and having some skin in the game (assuming some risk) as a way to build better relationships with clients and improve their technical and business skills.
Atotalnoob 3y ago
How did you get clients before word of mouth?

mmckelvy 3y ago

What kind of work do you do?

hello_moto 3y ago

I see that your niche is in C/C++ world (with some Obj-C), low-level stuff. Mind if I ask how's the market and what kind of clients (companies?) that you worked with? If you don't feel comfortable sharing the list, would you be able to share some hints? Out of curiosity because my background in college is more towards System programming but life puts me as a full-stack and backend/cloud engineering. Gettin a bit tired with too many backend tech (too many different storage solutions, backend languages, etc)

ChristopherM 3y ago
Most of my clients tend to be Medical Device startups, but I did have a really long relationship with a major food manufacturer. While it makes sense for them to hire full time software engineers for some of the work, they always have a hard time finding device driver experts. Also they tend to attract less experienced engineers, so having me on board helps to manage and mentor their team. And I'm generally the one laying out the architecture and breaking the project into smaller parts so their engineers can implement it. If you want to break into consulting, you have to figure out which field you want to be in. I'd avoid anything that has a boot-camp available for it, that's a race to the bottom. Then you need to get at least 10 years experience working in the field, preferably at a variety of companies, and make friends and business contacts at each place.
- hello_moto 3y ago
  Thanks for the insight. I have 10+ years working experience mostly in Cloud (think Java/GoLang/Python, AWS, Kafka, DB backed system, with 4+ years in front-end JS). Less experience in device-driver/OS development, system programming. I'm definitely interested to explore Linux/FreeBSD/Kernel or Device Driver type of work for fun. Would be great if I can make a living. Would also love C++ experience, but prefer not writing AppServer bizlogic type if possible, I'd rather do it in another platform.

ryanjshaw 3y ago

> This year I'm on track to bill out between $360k and $400k > To anyone reading this [post] and thinking they are offering you helpful advice, consider their motive Honestly I'd be happy to sign up to your newsletter and be upsold into a private $20/mo high-end consulting community forum if I were to learn how to earn those kind of numbers and I was disappointed you didn't.

ChristopherM 3y ago
I started "programming" in 1982 on a VIC-20, I taught myself C++ in 1991 and programmed as a hobby until I switched majors in University. Then I moved from Job to Job once I stopped learning/progressing. Along the way I made many contacts at a diverse group of companies. I started at a medical device company reverse engineering MRI/CAT scan data for a 3D device used in brain surgery. Then I worked for a company that specialized in Bug Tracking and Project Management. Then a company that engineered optical archival storage discs with a 100 year life span. Then I managed a team developing a video keno/poker gaming machine that was available to the Nevada/Montana market. Then I managed a team in reverse engineering cell phones for forensic analysis. Then a medical company that made a continuous glucose monitoring system for critical care environments. After 1 year working on their firmware, I was brought back as a consultant to rescue the Software department as a Director of Software Engineering over product and manufacturing. Through all these jobs I was well liked and since then have been contacted by people I used to work with for consulting work. And now I'm getting consulting work from other consulting job referrals. I currently charge $180 an hour plus expenses, but come January 1st will be raising it to $200 an hour because of the inflation and the fact it's not stopping. In terms of stating new increased prices; through the years I've informed clients to have them tell me it's too much. Then 30 days, 9 months come back and just sign a new contract at the new rate. You have to be willing to walk away, you have to have money in the bank so you don't "need" their work, but would be happy to if they pay your going rate. Just be professional, explain that you could be making more doing work for another client and it's "just business". I specialize in device drivers Windows and Linux, firmware, embedded RTOS and even desktop applications, mostly Windows but also can do some Qt on linux. My favorite language is C++ but frequently use C as firmware and linux device drivers are written in C. I also have quite a bit of experience managing, hiring, extracting and documenting software reguirments, architecting and implementing as necessary. As for getting new clients, I tend to pick up a client for 3-6 months of work and still do work for them 6+ years later. In the beginning they get most of my time, later I end up sitting in on weekly meetings, reviewing their code/design, mentoring their junior level software engineers, and helping them to hire more as needed. I end up standing in as their CTO/director/senior manager as they usually don't have the funds to hire a full time one.

the_lonely_road 3y ago

I clicked on you because I was curious and noticed your bio says you live in Nevada still if you care.

rootusrootus 3y ago
And not just anywhere in Nevada, but Incline Village. Pulled that up on Redfin and I can see why someone would be tempted to brag.
- jedberg 3y ago
  Incline Village is the closest you can be to the Bay Area and still live in Nevada. It's where a lot of tech folks go after they exit or if they get a remote gig because then they don't have to pay income tax, but are only a 3-4 hour drive to SF if they have to go in. It also has great schools. So you end up with a lot of moneyed California ex-pats there.
  - dragonwriter 3y ago
    > Incline Village is the closest you can be to the Bay Area and still live in Nevada. Factually, no, its not: Stateline, NV on the south shore of Lake Tahoe is 15 road miles closer than Incline Village on the north shore. About similar drive time, though. Incline Village is swankier though.
    - jedberg 3y ago
      Not in the winter. 50 can get closed for days, 80 is always plowed. Closest in terms of average time throughout the year.
ChristopherM 3y ago
I haven't made a post in years, I'll update my bio. I didn't realize it still pointed to Incline Village.

poulsbohemian 3y ago

Here's the challenge I ran into, so I'm curious how you handle it... If you bill by the hour, first they fight you over the hourly rate. Then they want to argue over how many hours it will take to do the work. Then they want to argue over you billing them for all the project management and planning hours you are spending with them, they only want you to bill them for "the work." Then when they get the bill they want to argue over the hours you bill them. And before anyone says "find better clients" I found this in everything from Fortune 500 to mom and pop. And Fortune 500 is net-180 regardless of what's in the contract. I was spending so much time in this kind of BS that I went to a monthly retainer model. You get access to me, but you are doing so in a way that we can both set aside haggling over hours. For the smart clients it was a great deal and it saved me a whole lot of accounting overhead.

chrisoconnell 3y ago
Have you considered a monthly retainer with an hour cap? This prevents you from being treated like a salaried employee, maintains your work life balance, and ensures the client is still providing solid requirements and thinking through their ideas. We have found a lot of great success with this model, and our clients respect it. It ensure we can have multiple clients, without one taking up all of our time, and taking it from others. If we spend under X hours, that's fine. But there's simply a cap. It essentially means that each client gives enough work for us to work for those total number of hours, and we still have MRR regardless. We can help our clients maximize usable time, and it makes our project management valuable to the client as well. To combat long Net Terms, you can kickoff a client with a project, which begins upon receipt of payment, and is continued with the retainer. This initial project should be able to support you until your retainer payments start (180 days in length) but your retainer should start ASAP. It also allows the client to see your value, and you get to feel the client out.
- poulsbohemian 3y ago
  At this point in life, I've moved on to a new field altogether, but some of the ideas you are sharing above are exactly the types of models I experimented with.

neals 3y ago

I'm a lot like you, I started out that way. Over time I added 4 good developers to my team and now have a steady flow of almost steady income.

deleted 3y ago

[deleted]

tptacek 3y ago

"Amateur" isn't the word I would have used, and I think the author sabotaged his point by using it. What I would say is, you're leaving a lot of money on the table and donating a lot of cortisol to entities that don't need the money or the cortisol donations, because they're not spending their own money, and the high order bit of their success criteria is "I was able to plug money into this interface and make a business thing happen within the planned time period, without adding any headcount". The other place I disagree strongly with the author is about the utility of flat-rate projects. I've had good luck with flat rate, but it was never the project structure we'd have used by default. Rather: for any project we did, we'd have quoted a full project, broken out into billable weeks, with a final sticker price and a paragraph below the pricing table with "additional work needed will be billed at our pro rata day rate". I think the attitude that says "all the risk should be borne by the client, not the struggling independent consultant" is bad business (for high-end tech consulting, you should start seeing your practice as being in part in the risk mitigation business!), but that doesn't mean you need to take on extra risk just for the hell of it. That said, there are clients who are so valuable, because they're going to be repeat-business house accounts or because their reputation is so strong that they'll bring in word of mouth business automatically, that you should definitely consider just doing flat rate projects for (if that's what they want) and just eat the overages.

pdonis 3y ago

> It forces the customer to focus on getting the requirements right This is an issue that the article does not address, and it should. Part of the business risk that the article is talking about is the risk of ill-specified requirements from the client. But that means that any flat-rate pricing has to price in the extra time and effort required to make sure the requirements are well specified (and that's true even if a fair amount of that time and effort happens before a contract is signed--you still need to recoup those costs somehow). Either that or you simply have to not take on clients who can't specify their requirements well enough up front. > consider their motive I agree, this is always a good thing to do.

deleted 3y ago

[deleted]

jedberg 3y ago

More power to you, but I stopped charging by the hour a long time ago. I charge minimum by the day, and offer a discount if you buy a week. I still bill for my time, but I avoid haggling over how many hours something took, and it also saves me the trouble of tracking my hours. You book me for a day, you get me for the whole (at least) eight hour day, however you want to spend that time. You book me for the week, you get me for at least eight hours each day for a week. I also do by the project billing, where I estimate how much work something will be, and pay on milestones. That requires a lot of up front work defining the deliverables in a way that avoids scope creep, but I also build in an overhead for scope creep so that I can "comp" them some deliverables that weren't covered, and everyone is happy. But the most important part is that the price is always agreed upon up front. The biggest issue with hourly billing is that neither of us knows how much the contract is worth until afterwards.

swader999 3y ago
How do you deal with clients that perceive and expect to have you available and working more than eight hours a day? What do you do about when your not immediately answering during lunch etc. What do you do about days where you detect l weren't fully engaged by the client for a full eight hours?
- swader999 3y ago
  "The biggest issue with hourly billing is that neither of us knows how much the contract is worth until afterwards." You still don't with daily billing.
  - jedberg 3y ago
    I know with daily billing because they can only book me for a set of days in advance. It's not ongoing. We agree ahead of time on the specific days I will be there/available.
    - swader999 3y ago

cushychicken 3y ago

Billing by the hour seems to focus your clients clearly in a way that being their salaried coworker just does not.

hermanradtke 3y ago

> It forces the customer to focus on getting the requirements right instead of hand waving it like "oh yeah, that's just what I want" and then come back later "I didn't want that, what I meant was" repeat ad infinitum. This is amateur because you are leaving an insane amount of money in “change orders” on the table. That is fine if you don’t want to do it, but it is sub optimal for maximizing your revenue stream.

gregjor 3y ago

You interpret a free opinion article that addresses a general topic as directed at you personally, take offense, then ad hominem question the author’s motives. He’s doing a little self-promotion, as you do and we all do online, but he’s not trying to “change the current consulting landscape” to benefit himself. Whom do you think reads his articles? None of my customers will. It should go without saying to non-amateurs that exceptions happen, no general advice fits every situation, and your mileage may vary. Then you boast about your own success. You don’t add anything to the conversation, offer no meaningful critique. Good for you with the high earnings and luxury SUV. For most freelancers (or consultant if you prefer, clients don’t care how you style yourself), especially the amateurs just starting out, the article addresses a very real set of problems. Those less experienced freelancers do face a race to the bottom as commodities. The article might help them think about how they position themselves and structure their projects so they aren’t struggling on freelancer marketplaces. If readers take nothing else away from the article they might think about adding business value versus selling their time, and having some skin in the game (assuming some risk) as a way to build better relationships with clients and improve their technical and business skills.

Atotalnoob 3y ago

How did you get clients before word of mouth?