[LRUG] Switching from solo contractor to being a development company

[Paul Robinson]

On 16 Feb 2012, at 12:29, luke saunders wrote:

> Has anyone made the jump from solo contractor to development company?
> And if so do you have any advice on how to achieve this? How do
> clients find you and do you have a lead gen / sales process?


Yes, and I have friends who have as well. I stopped that business in 2010 due to dire market conditions, but I have done it.

The trick is how you present yourself. Stop referring to yourself as a developer, and instead talk about yourself as CEO/MD of C42 Ltd or whatever.

Be honest with people and say you will bring together - and manage - the talent need to completely finish the job.

Be honest with yourself, and realise you will spend less than half your time coding and the majority of it managing.

At first, contract people in. Hire them at £250/day (or whatever) and charge them out of £300-£350/day. Charge for your own time. Decent contractor sites (like oDesk) make this relatively easy. It means with the right sales cycle you can grow quite dramatically. Just keep a really close eye on the numbers.

If you're doing Rails stuff, make sure you get people off oDesk who are in the top 20% on the relevant tests.

The advantage to that workflow is that if you need to pull somebody off a contract, they're not sat on your payroll with no billable work.

As you grow, build up enough cash reserves to meet pay roll for 6 months, or take investment. Start to move to full-time employees, and surround yourself with people better than you at this stuff.

It is hard, insanely hard, and when I was doing this stuff I would regularly work 80+ hour weeks and rarely get to code. My life consisted of sales, project management and accountancy. But it was a living, and I got to work with some great people.

Good luck,

Paul