Can startup consulting be a profitable business?

July 23rd, 2015

Assume I'm a certified digital marketeer who's had a couple of startups and is fluent in the relevant models and how to apply them. Somewhere down the line I aim to start consulting, I'm torn between:

1) Normal digital marketing consulting services for all sorts of businesses

2) Consulting services directly targeted for startups and helping them grow

Peter Kemball Member Issuers Committee at Equity Crowdfunding Alliance of Canada (ECFA)

July 23rd, 2015

Philippe,

Unless the start-ups you target have cash, current income for your efforts is not to be expected making you an investor. The odds of startup success are so low, that even where you able to make good judgment calls you would have to make 20 such investments and have at least 2 of them pay off at ten times your for cash hourly rate to breakeven and wait between a half decade to a decade to actually have cash.

Hope this helps you think it through

Stephen Levin Data Analytics Lead at Sestra

July 23rd, 2015

Startups are obviously fun to work with, but overwhelmingly they're a lot tighter about money. It's hard to get them to pay the rates that you can get a BigCo to pay, but you can certainly make money anyway.

Lorraine Wheeler President at Redstoke, LLC

July 23rd, 2015

It somewhat depends on how you define startups. Early stage startups without funding typically will not pay consultants. VC backed consultants will often (not always) use consultants that are recommended by the VC. So, if you have close relationships with VC firms, then option 2 could be viable. Startups that have product and revenue might be open to consultants that would help them grow if you present a compelling case, but they may not pay the same rates that a large company would. Good luck!

Mouhamad Médoune Boye

July 23rd, 2015

Hi ! The question worth to be asked... Consulting is always a good idea (when there is demand of course). Many Startups are looking for good advices and tips in such domains like growth and digital marketing. I am consulting in Digital Marketing and i can tell you that the demand is great among Startups here in Africa... 2015-07-23 18:50 GMT+00:00 Philippe Lobo Küng < reply+dsc+3509@founderdating.com>:

Dr. Gomes President and Founder at Gomes and Company

September 3rd, 2015

I have an active start up practice and have been very successful at it. My approach and compensation practice are more creative and flexible than most consultants in the field. I have worked on 20 startups including launching four successful startups myself. I especially like early stage startups. They are the most fun and provide the most reward for unique strategy development and hands on implementation.

Every start up needs, a financial plan, business plan, product development strategy, fund raising and pitch development, market research, sales plan, business structure approach, board development and executive recruitment plan. I usually start by offering to do selected pieces of any of the above items. I get paid well enough for that work. The last two start up consulting clients liked my work so well that they made an offer for me to join the executive team. One was a manufacturing start up that offered me the position of Chief Operations Officer on a three year contract. Another was a hi-tech company that hired me as the COO for a one year period. A third one offered me the position of CEO on a three year contract. All of these positions I accepted. When you count the management offers as part of my start up revenue, the total compensation was quite lucrative.

Devon Campbell Founder at Radworks, Startup Mad Science, developer at GRIDSMART

September 20th, 2017

It's just a matter of aggressively filtering your prospects. Anyone can start a startup… even people who don't have the money to pay your consulting fees. You want to make sure you're not spending your valuable time on those who can't.

Matt Kuppers CEO of Startup Manufactory

June 7th, 2019

Perhaps only focussing on marketing may be a tad too niche. We have been providing consulting to startups through Startup Manufactory since 2013 and it has proven to be profitable. It also depends on the size of the ecosystem you're operating in, of course.

Richard Bethea Clarity through Strategies & Analytics

June 14th, 2019

Hi Philippe,

When I started my consulting business back in 2012, I tried to work with startups for the first few years. I met many good people, and they all badly needed and appreciated my help. But ultimately I had to stop working with startups because they simply have no money to pay for outside help. It's sad because the need is great. Now, there are ways to do this if you get creative and also have a diversified portfolio. But it will slow your growth rate, and limit your income some. If you're interested in some lessons learned and advice, let's talk further.

Kevin Cuddihy President of Univision Local Media with a record of increasing Revenue and Market Share | Progressive, Inclusive Leader

July 23rd, 2015

you could talk to people like Bain Capital Management small cap (Under $50M) who are always looking for some expertise can startup consulting be a profitable business?@media screen and (){#yiv7795943606 #yiv7795943606featured-advisors-left{width:45% !important;padding:0px !important;}#yiv7795943606 #yiv7795943606featured-advisors-right{width:54% !important;padding:0px !important;}} | FD:Discuss | New Discussion on can startup consulting be a profitable business? | Started by Philippe Lobo Küng Previously Marketing Manager, CHEERS Wines. Previously Sales and Marketing, Base7booking. Assume I'm a certified digital marketeer who's had a couple of startups and is fluent in the relevant models and how to apply them. Somewhere down the line I aim to start consulting, I'm town between these two options: 1) Normal digital marketing consulting services for all sorts of businesses 2) Consulting services directly targeted for startups and helping them grow FOLLOW DISCUSSION or Reply Directly to this email to participate in the discussion Manage your email notifications

L. Marshall-Smith

July 23rd, 2015

It would depend on the stage of the start up, as others here have said. Too early, and they are looking for advice, expertise and connections, and have nothing to offer but equity or shares in the company. If you are as passionate about their burgeoning business as they are, then yes, go this route. But if it's got to be more of a pay day for you, then steer clear of these very early stage companies. Bottom line, they offer 10 or 50% equity in their company in exchange for your hard work, but let's face it, 10 or 50% of zero is zero as they are typically not valued yet, and they really have no company in the beginning. So I reiterate, if you share their passion, then by all means do those kinds of deals. But be careful. You may find yourself working very hard and not being able to pay the rent. On the other hand, start ups that are further along, already have secured venture funding, a Series A or Series B, are more likely to pay your standard rates, or close to them, and may even offer some form of ownership in the company. Either way, working with start ups is as rewarding as it is challenging, and I find it very exciting to be in on the ground floor with them. Just choose carefully, and walk away from deals that are too good to be true.

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