Should I do consulting work while running a startup?
I was recently asked to do some consulting work. The extra income would be great, but wondering if the distraction is worth it in the long run. Has anyone else picked up consulting work on the side. I am curious to hear how it worked and if you found your business suffered or not.
You are in a better position because you provide services. So you should operate a virtual office. Where you don't have to bare the cost of running a brick and mortal business. You should also state my providing advisory services for free. For example, giving legal advise on a platform like mosaicHUB can help boost your profile and can bring potential clients to you who will be willing to pay for your services.
Consulting work is good if you think you are capable of doing and also extra income is an added advantage.Maintaining balance between the two is equally important to avoid distraction.Extra efforts needed for consulting if you can put the same, you can do consulting work side by side.
It is not worth it in the long run. You will take away time from your main goal and it could result in consulting as your main occupation, rather than your dream business.
I would do it depending on your available time and if it does not stress you unduly. It can only enhance your value to employers if you do a good job.
I think this is highly dependent on how well you can compartmentalize the two concerns while productively managing the relationship, the company's expectations of you, and the nature of the work. If it is something where you can assume a biweekly work schedule (on one or two weeks, off for one or two), then I think it could work out. Having a part-time position that is critical to the successful operation of your client's business could prove difficult and stressful to manage. Furthermore, managing the scope of the work so that you do not commit to additional responsibilities would also be something to be aware of as these can quickly erode the part-time status of the position and is an easy position to get yourself into if you're a competent and motivated individual.
Depending on the extent of this distraction I would look into taking it on board. The start up phase is always a tight line for survival and these not only help, but could create an additional revenue stream from which you could draw if times become lean.
Consulting is an odd game. I have worked as a freelance Credit Manager since 2000 and found it rewarding. However you have to be very careful with some companies and businesses to ensure their stability. Certainly in the Credit Control and Management sector, you are likely to be going in to companies who have a cash-flow issues and usually cretaed by a combination of poor accountancy, billing and also providing their counter-parties with lines of Credit which should not have been granted in the first place.
Bearing the above in mind, you have to look at the company you are going in to and assess the risk to yourself, whether you be working through their payroll or billing yourself. I often use an employment agency to work through in these unstable cases, as the last thing you want is to find that you having problems recovering your own fees as well as sort out the clients issues.
At the other end of the scale you have companies/businesses who are trading through a difficult situation but not realising, more to the point recognising that they are actually in more serious trouble than they are. Further getting them to admit that they have a problem in the first place.
Then you have the panic management type of corporation where they suddenly recognise that they are in difficulty, but expect you to go in, waive a magic wand and in 14 days their problems go skipping off " down the yellow brick road"; these can be the most annoying. Often they have this fixation with statistics and that the number of phone calls per hour is more efficient in collections as opposed to investigating the grounds for their clients default, some of which may be complex and therefore time consuming.
Then you have those who do not like long responses (such as this) which give in depth reasons and causes for that client's issues. Most clients will only want to hear good news, and not the fact that you are going to have reserve a significant part of the ledger for bad debt. The latter usually as a result of not underwriting their client for risk and down to a fixation with the mentality that if you throw as much rubbish against the wall, some will stick: a sale at any cost. However that sale has not taken place until the debt is paid.
Getting many sales, indeed directors to grasp that concept is increasingly difficult.
There is often a requirement to teach your client that for each loss they make, the cost of recovery is the value of sales paid to time and on the profit margin that they work to. That is to say if you are on a 5% margin; writing off £1000, actually means billing and receiving on due date, £20 000.
Consulting work can be very rewarding providing you are prepared to put up with nonesense from your client; and expect to have run-ins with both sales and directors relating to differences in opeartion as outlined above, a sale at any cost. Usually that is the cost of the life of the company. However to be able to show that the correct trading protocol gives a better return on a lower turnover is very rewarding when you can get the client to grasp that concept. To be able to say both to yourself and other people that you stopped that company from going under, or that you help a small business go in to the AIM part of the Stock Excange, indeed fully quoted PLC is very rewarding.
However expect rebuffs and being asked to leave becuase you are breaking bad news. The other issue is that there can be long breaks between contracts and you have to be in a position where you can service your own standard of living and service your own debts without going under yourself! It is not all as cosy as it seems: take your victim as you find them !
Running a start up may not leave you with enough time to do justice with consultancy.
if it can support your experience and does not effect your other project...go for it
Yes, why not. Doing consulting work will help you gain more insights and develop business connections. Learn how to balance, filter and choose projects that are related to your interests.