Good idea! Yes, I've learned a few lessons the hard way - like how the bankruptcy laws work (that one cost us about $10k) and about "barriers to entry", along with a few more. I'll see about working some posts on those. Thanks.
@DarylGerke I hope that you are going to share some of the things you've learned the hard way being a consultant. While not in the same field, i did freelance work for a company and never got paid, it was a lesson I really learned the most difficult way!
Seems to help if the 2 guys have the same first name! Like 2 Steves started Apple, 2 Henrys started Broadcom (my employer), and 2 Bobs started Linear Technology. Am I looking for my other Jim? No, I tried entrepreneurship and found it was business XOR family. I chose family. Next to impossible to do both well.
@DU ...a team of two: a technical wiz and a marketing guy. Frequently the wiz even left at some point - annoyed of marketing, finance, organizational and so on themes. The company continued to flourish.
I once worked at such a company, but the wiz was ousted when his wife found out about his secretary and in a pique sold her shares to the marketing guy. Without the wiz's technical leadership the company did NOT flourish, it went straight down the sewer pipe.
Good advice! If you only wiah to solve technical problems, running your own consulting business may not be a good idea.
On the other hand, if you want to try being an entrepeneur, starting a consulting practice is a good way to gain business skills, as you will be forced to deal with critical sales, marketing, and organizational issues. It worked that way for me.
Also, starting a consulting practice can be a good way to test the waters. Little or no startup capital needed, and you can quickly test your ideas. I know of one very successful high tech company that started that way - first consulting first, then development contracts, and finally a manufacturing special systems.
Best wishes with what ever direction you choose to follow!
"...does consulting help one become a better entrepreneur...?"
IMHO - working as a consultant though not self-employed: NO
For the entrepreneur marketing, organizational issues etc. are much more important than expertise in the technical field.
Sad but true: longterm successful companies often started as a team of two: a technical wiz and a marketing guy. Frequently the wiz even left at some point - annoyed of marketing, finance, organizational and so on themes. The company continued to flourish. On the other hand there is a long list of companies started by a technical wiz that failed when it came to tend to these themes.
If you're addicted to solving technical problems, the organizational issues might simply be annoying and distract you from solving technical mysteries.
An entrepreneur has to be more deft skilled that consultant but does consulting helps one become a better entrepreneur because a consultant knows the field better and can bring out something new for a company?
To Sanjib - Liked your "battle scars" comment! So how many years are enough to get started? It depends on how many "battle scars" you've collected. For most of us, however, it probably takes at 5-10 years to feel comfortable enough with our technical skills to offer them as a consultant.
But you also need to develop your business skills (marketing, sales, administration) to make a consulting practice successful.This is where many new consultants fail - their technical skills are fine, but they can't bring in enough business. Incidentally, I treat the marketing problem as just another engineering problem. After all, as engineers we're problem solvers, right?
After starting a consulting practice, it may take a couple of years to feel successful. For me, by two years I felt pretty secure, and by five, I knew that the business would last (as long as I continued to work at it.) But the whole journey was fun -- much like any start-up situation. Best wishes as you explore consulting!
To Ahmet - Enjoyed your perspectives! Really liked "Consultancy is being independent" and "Consultancy is sometimes being odd" :-)
To AZskibum - Yes, I agree with your difference between contract engineers and consultants. In fact, I'll be addressing that in a future post, along with "coaches" anc "counselors."
If you don't like to market, contracting can be a good alternative, but at the price of some independence. I've known several engineers who have toggled between contracting and consulting during their careers with good success.
To all - Thanks to all of you for your comments, and watch for the next post in a week or two. The plan is to post once or twice a month, and will include general consulting topics as well as "success stories".
I'm looking forward to reading more in this series and will have a look at your blog.
BTW, another often misused application of the title "consultant" in our industry is when it is applied to contract engineers. Yes, they bring specific expertise like analog design or digitial design, but in practice, they come onsite and work on a project day after day, right alongside the firm's regular employees. Simply getting a 1099 at the end of the year instead of a W-2 does not, IMHO, make one a consultant.