One giant leap

I’ve been working as an independent consultant for well over a decade. The experience has been amazing: life-changing in many ways. But I have scars. Some of them were self-inflicted. Some are a natural consequence of being in a tough industry for a long time.

One of my five driving values is ‘grit’. This is the belief that keeping going — no matter how tough the terrain gets — is essential to success. When starting out as the founder of an independent consultancy, I hadn’t realised quite how much I’d need it. 

Here is a summary of five things about life as an independent consultant that I wish someone had told me all those years ago.

I’m conscious that it isn’t a comforting read. If you’re considering independent consultancy, it might even give you pause for thought. But I hope not. Instead, I hope it acts as a useful primer. Survival and success is about values and mindset: a willingness to face into the challenges that entering an unfamiliar industry presents. It is also about taking the right practical steps. (Then there is sheer dumb luck, although that’s the one factor we can’t control.)

1. The first two years will be the hardest

The low barriers to entry in consulting are deceptive: the fact is that the vast majority of independent consultancies fold within two years. (The number is around 80% in the US and the UK. Yes, that’s right: four out of five.) 

You might start out confident about your place in the 20% that do make it. But outside of your immediate network, the world will prove indifferent to your survival. People will express interest in what you are doing at first, but that will wane faster than you’d hoped. You will then face the discomfiting fact that a reputation takes time to build. A lack of reputation can make it hard to persuade clients to engage with you.

If you have launched with a founding client relationship, great. This can ease the transition. But it is when you start to try and attract new prospects to your consulting offering that the hard work will start.

In those first two years, you will also be feeling your way into the services that you offer, and how they are best priced. You will be working out how to sell into organisations that are far larger than your own. You will learn that they have their own processes, which will sometimes prove unfavourable to you. Your cash position might leave you vulnerable to fallow sales periods or poor behaviour.

You will also be managing client relationships as an independent consultant, perhaps for the first time. This will prove a novel experience even if you have worked in-house with those people before.

No two ways about it: this is a challenging set of circumstances for even experienced professionals to face. 

The good news is that it does get easier — in time. 

2. Success isn’t about your domain knowledge

Independent consultancy interests you because you believe you can see and solve certain problems better than anyone. This might be true. If so, that capability will be your best friend.

But independent consultancies don’t fail because they don’t know lots of useful things. In fact, even new consultants tend to be pretty good at the stuff of consultancy. But they’re not experienced in the business of it.

A range of mistakes can flow from this. Poor pipeline management. A misplaced belief that your network will see you right. (Networks are vital, but can fast prove less fruitful than expected amongst even the most well-networked people). Under-scoping or under-pricing projects. Over-servicing clients in an attempt to please or placate them. Political naïveté. Poor cashflow management. The list goes on.

Last week I was speaking with an ex-independent consultant. He’s an experienced professional with an outstanding knowledge of the marketing industry. He was back working full-time in a salaried role, having struggled to make consulting work. “It was the ghosting,” he said. “I got so tired of the ghosting.”

So, if you are thinking: 80% of independent consultancies fail because they don’t have my level of insight and knowledge, I beg you to think again. To stay in consultancy you need to master the business of consultancy.

3. You will feel confused about money

Establishing what to charge clients — and how to charge in a way that reflects both your needs and your value — is a journey.

If you are joining the ranks of the independents from a salaried role, you will need to rewire your relationship with money. This is not least because your historic salary bears no relation to how you need to price your services now. Your income might also prove less stable than a salary for a while. Your pricing needs to factor this in.

But pricing benchmarks will prove hard to come by. You might find yourself turning to Google in desperation. You might encounter gobsmacking anecdotes about what the Big 4 consultancies charge. You will wonder how on earth this sort of pricing approach applies to you. 

As you seek to establish a fair price for your services, you might end up negotiating with yourself more than you do with your clients. This is because your relationship with what you charge now feels acutely personal. The rate you realise for your services has a direct bearing on your quality of life. And you worry that pricing high means you won’t win work. This equates to personal jeopardy.

It might be cold comfort, but here’s the truth: everyone feels confused about money. 

4. Seeds sprout at different rates

When starting out, you will try your hand at networking (informal and otherwise), and will end up having conversations with many different people. Those people might introduce you to other people who could be interested in your services. You will start the process of developing relationships with them.

On occasion, something great will happen, and far faster than even you expected. A brilliant new business opportunity lands right in your lap. A new partnership unexpectedly bears fruit.

Quite a lot of the time, though, you will feel that your efforts have been in vain. Try as hard as you might, nothing seems to be happening in your favour. But your relationship with time might need reappraising. The reality is that you will not know for a long time — sometimes years — whether your investments have borne fruit.

An example: at the time of writing, I am working on a large advisory project. 

One of the largest I’ve ever taken on, in fact. This project has its roots in a networking event that I staged nine years ago, which I felt at the time had been a complete waste of effort (and hard cash). But, unbeknown to me, two people met at that event who went on to cross-refer business to one another. Several years down the line, they realised that they needed some help on a specific project. I got the call. That seed took nearly a decade to sprout. I’m thankful to have planted it — now.

5. Every day you will learn something new

Every day you will be brought up close to challenges, weaknesses and blindspots — both your own and others’ — that you have never encountered before. You will witness good and bad behaviour that surprises you. Problems will confront you that you have no idea how to resolve. This will happen both in the context of your client work and your own management of your business. You will come face-to-face with the limits of your talents, skills and experience.

This is what makes working as an independent consultant difficult. It is brutal, vertiginous, frustrating — and, in the end, lonely.

But it is also the primary reason to keep working as an independent consultant. It is a learning experience like no other: fascinating, challenging, enriching — and, in the end, empowering.

I started this piece by saying that the last decade or so has been an amazing experience: life-changing in many different ways. I stand by that. I am a better professional (dare I say it, a better human being) as a result of what I’ve learned running my own consultancy. 

And that brings me to the main thing I wish someone had told me when I was starting out: it’s going to be more challenging than you ever imagined. But stick with it, because the challenge is the gift. It will change you for good.

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What to take from this article

Independent consultancy isn’t for everyone. But if you can prime yourself to stay the course, it might just be right for you.

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