4 ms·

There are many niche skill sets out there where the demand far exceeds the currently supply, and as such hourly rates from $100/hour (lower level) to $200+/hour

by modoc 15y ago

There are many niche skill sets out there where the demand far exceeds the currently supply, and as such hourly rates from $100/hour (lower level) to $200+/hour (architect level) are quite common and you really can pick your job/location/work from home, etc... The trick is finding one, and learning it quickly/well. I've often thought about grabbing a bunch of folks with a similar relevant skill set, investing 6-12 months in training them, and then running a hugely profitable consulting company for a while. The problem being it's hard to prevent people from hanging out for your 12 months of training, and then jumping ship to do their own thing afterward...

jandrewrogers 15y ago
The kind of expertise that consistently commands the high rates requires a level of experience that cannot be developed through training. It requires in-field domain expertise developed over a few years. What you are talking about is what many consulting companies actually do, and it is one of the reasons that consulting companies have such a poor reputation for execution. Customers are paying for the expertise you will not pick up in training or by reading a book. I ran a successful consulting business many years ago (and hated it). One of the things you learn is that you live and die by the quality of the people you can deploy because that goes straight to your reputation. In practice, consulting businesses are very difficult to scale. While you may start out high-end with a great reputation because you really know what you are doing, it is very difficult to bring in additional people with your level of skill because there is almost no overhead to them working independently. As a result, "scale up" often involves diluting the quality of your overall team to the point where the rates you can charge decline as well. Consequently, you either have to run a very small boutique consulting shop that can maintain its standards and billing rate or run a large generic shop that makes up for the lower billing rate in volume. For people that care about the quality of their work, the former is more rewarding but the economics work out such that you will make about as much money by going direct as a highly-paid contractor to another company.
- modoc 15y ago
  In this particular case I'm not talking about grabbing random people, I'm talking about people who are very skilled in a similar tech stack (which has a much higher supply/demand ratio, and getting them up to speed with the very similar but niche stack. Basically you're just learning some new APIs and some new service providers (i.e. proprietary ORM instead of Hibernate). But I agree with your assessment of consulting firms and the scaling/quality issues therein. I also feel that consulting shops expenses tend to scale a lot closer to profits than some other businesses, so I stay out of it:)
jbjohns 15y ago
>The problem being it's hard to prevent people from hanging out for your 12 months of training, and then jumping ship to do their own thing afterward... It's pretty easy actually: pay them well.
- hello_moto 15y ago
  What will happen when the client pays less than the previous project? What happen if the developers are just that kind of people? i.e.: wanting to be their own man strutting their dongle around? It's pretty easy to say than to do it :D
  - jbjohns 15y ago
    If someone is making a consulting agency that gets clients, deals with most of the risk, etc., then that is worth something to me and I'd be willing to take a less then I could get if I were doing the same work freelance. I'd give up, say 10-20% of the value of the contract to pay for such services. If the owner wants to take much more than that then he/she will have to expect people to jump ship after training. The salary difference is worth taking on these other responsibilities yourself or finding an agency that will take less. As far as your second example of people, I don't think enough people are like that to warrant consideration. People are more likely to stay with a company beyond the point of rationality.
    - modoc 15y ago
      The problem is that if you spend 6-12 months training people you've got WAY more costs to recoup than a normal contracting firm so you'd have to take a higher percentage off the top. The rates would be higher for the niche so the take home would still be good, but a smart person would see you taking 30+% off the top, and know they can only give up 10-20% at another place or none by going freelance once they have some network in place. The sunk costs of the training and bench time around that are very hard to make back.
Estragon 15y ago
I'd be really interested to read a list of these highly remunerative skillsets. Going to be taking some time off, and probably heading in a new direction when I start working again.
- hello_moto 15y ago
  SAP, Oracle Fusion, PeopleSoft, Oracle OnDemand, Microsoft Biztalk, Microsoft Dynamics, IBM Lotus Domino (may have wane off). Quite possibly OpenBSD (sys-admin/net-admin). Kernel hacker specializing in odd OS (OpenBSD, FreeBSD, the new Solaris distro, etc). Ruby on Rails used to demand high compensation back in 2006. Clojure and maybe Scala might be on the same spot where Ruby/Rails was. Sometimes what it takes is to be the top #5 consultants in a niche field (i.e.: PostgreSQL guru)
  - modoc 15y ago
    ATG Commerce (now Oracle ATG Commerce) is the niche I was speaking about, but the above list is 100% true as well. Lots and lots of opportunities.
    - sycr 15y ago
      How does one go about finding developer resources for closed applications like Oracle ATG (or really any of the above list)? I'm employed by an eCommerce vendor myself, so I'm sure I'd have an intuitive understanding of general architecture, but actually understanding the internals of a system as an outsider seems like a difficult proposition.
      - modoc 15y ago
        Until Oracle bought ATG it was basically impossible. But Oracle has made ATG available for download, including documentation, to anyone, without needed a million dollar support agreement. You can't run a production site for free obviously, but at least now you can read the docs, and play with the software locally. The only real hope of learning it though is to have a company that you work for use ATG, send you to training, and get you coding on it every day. This is why there is such a huge gap between the demand and supply of this skill set currently.

by modoc 15y ago

jandrewrogers 15y ago

The kind of expertise that consistently commands the high rates requires a level of experience that cannot be developed through training. It requires in-field domain expertise developed over a few years. What you are talking about is what many consulting companies actually do, and it is one of the reasons that consulting companies have such a poor reputation for execution. Customers are paying for the expertise you will not pick up in training or by reading a book. I ran a successful consulting business many years ago (and hated it). One of the things you learn is that you live and die by the quality of the people you can deploy because that goes straight to your reputation. In practice, consulting businesses are very difficult to scale. While you may start out high-end with a great reputation because you really know what you are doing, it is very difficult to bring in additional people with your level of skill because there is almost no overhead to them working independently. As a result, "scale up" often involves diluting the quality of your overall team to the point where the rates you can charge decline as well. Consequently, you either have to run a very small boutique consulting shop that can maintain its standards and billing rate or run a large generic shop that makes up for the lower billing rate in volume. For people that care about the quality of their work, the former is more rewarding but the economics work out such that you will make about as much money by going direct as a highly-paid contractor to another company.

modoc 15y ago
In this particular case I'm not talking about grabbing random people, I'm talking about people who are very skilled in a similar tech stack (which has a much higher supply/demand ratio, and getting them up to speed with the very similar but niche stack. Basically you're just learning some new APIs and some new service providers (i.e. proprietary ORM instead of Hibernate). But I agree with your assessment of consulting firms and the scaling/quality issues therein. I also feel that consulting shops expenses tend to scale a lot closer to profits than some other businesses, so I stay out of it:)

jbjohns 15y ago

>The problem being it's hard to prevent people from hanging out for your 12 months of training, and then jumping ship to do their own thing afterward... It's pretty easy actually: pay them well.

hello_moto 15y ago
What will happen when the client pays less than the previous project? What happen if the developers are just that kind of people? i.e.: wanting to be their own man strutting their dongle around? It's pretty easy to say than to do it :D
- jbjohns 15y ago
  If someone is making a consulting agency that gets clients, deals with most of the risk, etc., then that is worth something to me and I'd be willing to take a less then I could get if I were doing the same work freelance. I'd give up, say 10-20% of the value of the contract to pay for such services. If the owner wants to take much more than that then he/she will have to expect people to jump ship after training. The salary difference is worth taking on these other responsibilities yourself or finding an agency that will take less. As far as your second example of people, I don't think enough people are like that to warrant consideration. People are more likely to stay with a company beyond the point of rationality.
  - modoc 15y ago
    The problem is that if you spend 6-12 months training people you've got WAY more costs to recoup than a normal contracting firm so you'd have to take a higher percentage off the top. The rates would be higher for the niche so the take home would still be good, but a smart person would see you taking 30+% off the top, and know they can only give up 10-20% at another place or none by going freelance once they have some network in place. The sunk costs of the training and bench time around that are very hard to make back.

Estragon 15y ago

I'd be really interested to read a list of these highly remunerative skillsets. Going to be taking some time off, and probably heading in a new direction when I start working again.

hello_moto 15y ago
SAP, Oracle Fusion, PeopleSoft, Oracle OnDemand, Microsoft Biztalk, Microsoft Dynamics, IBM Lotus Domino (may have wane off). Quite possibly OpenBSD (sys-admin/net-admin). Kernel hacker specializing in odd OS (OpenBSD, FreeBSD, the new Solaris distro, etc). Ruby on Rails used to demand high compensation back in 2006. Clojure and maybe Scala might be on the same spot where Ruby/Rails was. Sometimes what it takes is to be the top #5 consultants in a niche field (i.e.: PostgreSQL guru)
- modoc 15y ago
  ATG Commerce (now Oracle ATG Commerce) is the niche I was speaking about, but the above list is 100% true as well. Lots and lots of opportunities.
  - sycr 15y ago
    How does one go about finding developer resources for closed applications like Oracle ATG (or really any of the above list)? I'm employed by an eCommerce vendor myself, so I'm sure I'd have an intuitive understanding of general architecture, but actually understanding the internals of a system as an outsider seems like a difficult proposition.
    - modoc 15y ago
      Until Oracle bought ATG it was basically impossible. But Oracle has made ATG available for download, including documentation, to anyone, without needed a million dollar support agreement. You can't run a production site for free obviously, but at least now you can read the docs, and play with the software locally. The only real hope of learning it though is to have a company that you work for use ATG, send you to training, and get you coding on it every day. This is why there is such a huge gap between the demand and supply of this skill set currently.