So, You Want to Start Consulting?

Written By Aditi Naik

We get asked a lot how we got started in consulting, and how we got our first clients. We developed this resource to help answer some of those frequently asked questions, and what we think should be the first few areas of focus as you start consulting.

First things first, what can you do? And is it written down?

create a one pager

You should be able to clearly articulate to both your network, and prospective clients, how you can help them, and what services you can offer. Ideally this one pager covers: 

  • Who you are - what is your work experience? Who are you as a person?

  • What services you are offering/how you can help - be as specific as you can, without the use of jargon! Once you have the copy written, share with friends who work in a different field to make sure they can understand. Remember, people don’t usually hire consultants for things they know about or know how to do, so assume your prospective client knows little about your subject matter.What types of roles you are looking for (and maybe even what you’re not looking for).

    1. Consider providing concrete examples: 

      1. We can project manage the launch of the new entity and creation of compliance and operational infrastructure to work across entities.

      2. Example: “Organization” had an existing fiscally sponsored 501(c)(3) and wanted to establish an affiliated independent 501(c)(4). We supported the planning, launch, and continued operations of the (c)(4) with both strategic and project management support.

  • What sets you apart from other consultants? This might be your values, how you approach the work, how you collaborate etc. Separate yourself from the pack!

  • Pricing - we believe that transparent pricing helps, not hurts! If you’re considering hourly pricing:

    1. `Consider a sliding scale to broaden your client base if you’re able. 

    2. It can be easy to undersell when starting out, so we would recommend considering building in a rate refresh into your contract for any longer term engagements, or structuring the scope into phases, so you’re able to revisit the rate when moving into the second or third phase.

    3. Be clear about charging for work performed even (especially!) if it doesn’t result in a contract e.g. from a basic scope of work to a more in-depth proposal. This can take place during a discovery call or in a follow-up email.

Once you are able, we highly recommend investing in a website. Having a website broadens your reach, and gives you more credibility. We used Studio Junk to help create our website and branding.

  • We would also recommend using a copy editor to support the content for your website. Again, it’s really important that prospective clients be able to understand what you do, in practical terms. A copy editor can help you get your message across, and attract the right audience.

Activate Your Network

Most of our initial, and continued business, comes through word of mouth.

Create a list of anyone and everyone you know in/adjacent to, or someone with connections, to your field. See who your most frequent email contacts are and scour your Linkedin connections, including 2nd connections. 

  • Email all of them: Let them know what you’re up to: “I wanted to share some exciting news that I’ve recently taken a new step in my career…”

  • Share your one pager: “Attached you can read more about the work I’m doing/services I’m offering” 

  • Make a concrete ask! Most people want to help, they just don’t know how, or don’t have time. These asks could look like:

    1. Do you know any organizations in your network who are actively looking for this support/services? 

    2. Can you introduce me to 1-2 people in your network that could support me in [developing my services, building out my network, providing feedback on my business plan, etc.] 

    3. 15 - 30 min catch up to give me advice on xyz 

  • Keep those relationships “warm”. Send updates to your network every ~6 months to let share: 

    1. Recent client projects 

    2. What types of work you want to take on 

    3. Trends in the field 

  • In particular, find ‘champions’ for you and your work. People who can speak to you and your work specifically, who can put in a good word with their own networks. Word of mouth goes a long way in the consulting space. 

  • Consider attending conferences, but only ones where you can 1) actively network and feel comfortable doing so and 2) where you will meet the “decision makers” - the people who would actually decide to hire you 

  • As much as we hate to say it, LinkedIn works, so use it. Post about your work, what resources you find that are helpful, trainings your attending, etc.

Save money For Taxes

As a consultant, your payment from clients will not have taxes withheld, which means you will owe taxes to the IRS for the income you earn. Make sure you understand your tax obligations, and are prepared to pay any taxes. If you’re able, we would recommend working with an accountant. If you need recommendations, reach out!

Other Things to Keep In Mind

Financial Sustainability

Consulting work will always ebb and flow, and it is important to ensure that you are planning for those slower moments by creating a realistic budget for yourself. We definitely recommend utilizing a cash flow, and/or a capacity management tool. We use Float for our forecasting - this allows you to include your budgeted expenses, confirmed revenue, and projected revenue.

Consider how to budget for sick or emergency time off as well. Budgeting can be both for your own finances as well as sustainability plans with clients, ie: what happens if you can't show up?

Consider if you can/want to commit to consulting as your main income source straight away or if this is something you build more gradually alongside your main income source. Bear in mind that it can take at least a couple of years to establish your practice.

Metrics for Success

Determine what constitutes success for you, rather than comparing yourself to other consultants. This might look like “a family-work balance that looks like X” or “doing rewarding, values-aligned work” or “by year X I want to have break even/have X increase in revenue.”

Capacity

It will often be tempting to take every project that comes your way, but make sure you have the capacity to do the work, and to do the work well! You want to ensure that your clients are satisfied with your work, given how small the field is, and how quickly word travels. We use Paymo to help build out our capacity projections so we aren’t committing to too much (this also allows us to build in ample time off!).

Communication

Proactively communicate with any clients on your limitations, schedule, or anything else that can slow down the work. Set realistic timelines to get the work done so that you aren’t scrambling to finish projects. 

Set up a good calendar system that can help schedule new meetings with potential clients and/or ongoing meetings with current clients (e.g., calendly), and practice blocking off time, or having no meeting days to ensure you can accomplish your work

Tools 

Consider what reusable tools will be helpful for your specific business right away, and take a little bit of time to build them out  (especially if you are waiting to get into a full load of clients). Examples might be: discovery/intake questionnaire for potential clients, kick-off agenda templates, budget-making template (if you do finance), personnel policy template (if you do HR), etc.

Intellectual Property

Protect your IP. If you’ve developed signature tools/products, determine in your contract how the client may or may not use them beyond the scope of the engagement. You should be able to at least negotiate a “perpetual license” to the IP, if not joint ownership of IP.

Thinking about starting a consulting business with other people?

We have a lot more to say on this topic! Reach out to us, and we would be happy to set up a free 30 min conversation. 

I need more help!

We get it, and we are happy to help you. In addition to supporting nonprofits, we also help small businesses with setting their bill rates, figuring out capacity, setting up financial processes and infrastructure, sharing resources (providers, templates, tools), navigating challenging client dynamics, etc. You can hire, or set up a coaching engagement, with us. 

Resources 

  • Accountants: This is who we use for our accounting https://www.exceptionaltaxservices.com/ 

  • Website Development: https://www.studiojunk.co/ is who developed our branding, website, and social media collateral 

  • Legal Formation: 

    1. We are an S Corp and we used Beeline Legal to incorporate us, prepare our shareholder agreement, and complete our state registrations 

    2. Alternatively, there is a platform called Collective that can help you set up your LLC or S Corp and help with a lot of the other administrative pieces that come with running your own business. They also file your business tax returns, help you with quarterly tax estimates, and provide basic accounting services.

  • Employment and Benefits: If you have more than 1 employee, you can look into using a Professional Employer Organization to help you with payroll and benefits. We use, and love, Justworks. 

Contributions to this document made by:

Aditi Naik
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