The Perils of Bootstrapping via Consulting


Since the last startup I was CTO of was acquired in 2009, I’ve been working for other startups and agencies as a consultant. While my main goal in life is to be building startups that I am the founder/co-founder of, consulting has been a great way to pay the bills while I iterate with different products, ideas, and people, figuring out the next big thing to throw myself into with all my heart. Everyone talks with great praise that taking on consulting projects while running a startup is a great thing – avoids outside financing and lengthens your runway.

There are real problems with consulting

  1. You only have a limited amount of time during the week. Consulting takes time out of your day. What is your most precious resource?
  2. When you’ve blocked a certain amount of time to work on your startup, when a client calls with a burning question or meeting, it’s a distraction.
  3. Consulting encourages jumping around. I can on some days be juggling 8 or 9 different consulting projects, and have learned how to switch quickly. That is the complete opposite of a startup – where a laser focus.
  4. The short-term opportunity cost of working on your own internal startup increases tremendously. When you’re being faced with the choice of “Do I work on my startup, with some chance of success in the future” vs “Do I make some good money right now” – and you’re being asked that every minute of every day, committing to your idea becomes even more challenging.
  5. The biggest flaw. When you hit a rough patch with your business (bad feedback, lack of interest, technical challenge) and that little seed of doubt starts to grow… it’s effortless to take a few more consulting gigs, and before you know it, it’s been months since you’ve cracked open the code base.

What I do to prevent it (and I’m not perfect)

  1. Break up both consulting work and internal startup work into manageable chunks. That way you can mix both together in a day.
  2. In true GTD style, write down what you need to accomplish before you start your day. It’s at that planning stage where you can put thought into how you want to balance your day.
  3. Don’t check email so often.
  4. Hire other people to work with you. Task one of you with with client work, and the other with internal product.
  5. Keep track of your financials. How much consulting work do you actually need to take in this month?

What I’ve seen other people do

  • Block off a certain part of the week/day for client work, and part that’s just for startup work. Don’t even think about picking up the phone, or having a meeting
  • As your team grows, you can have people focused entirely on internal projects, that will never touch client work.
  • Magically find a product idea that your clients can pay you to build, and be your first customer :-)

Don’t get me wrong, I love me clients. But we all know that consulting for an entrepreneur has to be treated as a means to an end.