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I've been self-employed for the last ~18 months. In the past I started two VC-backed startups, then was a PM at some later-stage companies before returning to e

I've been self-employed for the last ~18 months. In the past I started two VC-backed startups, then was a PM at some later-stage companies before returning to entrepreneurship. This time around, I'm building a solo "digital product studio" [1] instead of a startup. So, I'm staying one person, haven't raised money, and have multiple revenue-generating products. Product revenue doesn't cover my costs yet, so I do occasional consulting to bridge the gap. I like the flexibility of this lifestyle. I'm based in NYC, but writing this from Tokyo where I've been doing a creative residence for the past two weeks. And, a fun technicality - I truly self-employed in the sense that I have a salary and a payroll system. This is because my company is registered as an S-Corp in the USA, which requires the owner to be on a salary. [1] https://www.contraption.co/essays/digital-product-studios/ https://www.contraption.co/essays/digital-product-studios/

asim 3y ago
This is super cool! I was/am a startup founder too, bootstrapped an open source project, raised VC money, but ultimately it didn't work out. Now thinking about a solo business again and the studio model was exactly what I was looking at. How did you decide what to build?
- philip1209 3y ago
  My first product Postcard [1] is a personal website builder. I built that because I thought a personal website maker made logical sense as an indie business, and I wanted a way to stay in touch with friends after I deleted social media. But, it's hard to scale - user acquisition is the name of the game, willingness to pay is lower, the product isn't super differentiated, and I don't have a lot of experience in B2C. So, it makes money and continues to grow - but is small in absolute terms. I decided to work on a more ambitious project that I had been thinking about for years, inspired by a product I wanted at my last startup, and by the chaos of being in 100+ slack channels at a previous job. I hate how people use Discord + Slack - they're good for urgent communications, but we need a "low-attention" version for important communications in communities and at work. So, I started building this product last Summer. Booklet is an async, newsletter-first community platform [2]. Something like Google Groups with the polish of Slack. Booklet's far more complex than Postcard, but plays into my skills more - such as complex permissions systems, email marketing infrastructure, B2B sales, and being able to incorporate all the latest OpenAI goodies quickly. I launched it about three months ago, it has revenue, and I've been scrambling to build things in response to user feedback. I'm thinking of doing a bit of a relaunch next week as some foundational flows come together, such as full PWA support, search, and Stripe member sync. Coincidentally - the project I launched to dogfood Booklet, called FRCTNL [3], is doing quite well. I had no intention of monetizing it, but I included a referral link to the accounting service I use. People have been using that referral link, and last quarter FRCTNL was my highest-earning product. I'm sure in a few years I will have some great stories after the fact about the lessons I was missing in plain sight. But, things feel a little chaotic, uncertain, and fun at the moment. The core theme is building things that I want. My main insight so far has been to build unique, differentiated products that I want to use myself. [1] https://postcard.page https://postcard.page [2] https://booklet.group https://booklet.group [3] https://frctnl.xyz https://frctnl.xyz
  - mamidon 3y ago
    Very interesting, I like the idea of frctl. Signed up.
  - derzan 3y ago
    What avenues did you go through to reach VC funding? Prior connections, or other points of communication?
    - philip1209 3y ago
      It was a little bit of everything, to be honest.
kgdiem 3y ago
Wow! I’m working on the same thing at https://stackstudio.dev https://stackstudio.dev right now. Your blog post was really eloquent, it’s always inspiring when someone else shares your idea. Best of luck.
- philip1209 3y ago
  Thanks! I'm trying to do more essay writing there [1]. Most indie makers seem to have some content strategy where they share their story. I avoid social media and don't desire to become a Youtuber, so I'm focusing on writing as a content channel. I'm focusing essays on my creative process, inspiration, and specific experiences as an operator - the stuff I want to read. I'm avoiding prospective predictions about the future, being negative (an actual self-imposed rule), and talking about things that feel more like theory than practice. The next piece I plan to publish tomorrow will be a recap of a talk I gave over the weekend, covering how most of our knowledge work practices come from factories, and ways software engineers are at the forefront of changing those industrial-era practices. P.S. - if you're ever in NYC, come join for a dinner of Dimes Square Ventures [2], which is a little community I run for local indie makers (using Booklet!) [1] https://contraption.co/essays https://contraption.co/essays [2] https://dimessquareventures.com https://dimessquareventures.com
  - kgdiem 3y ago
    I live in Hoboken :D sending you an email for dimessquare!
bicx 3y ago
I have a similar story. I’ve been self-employed for the last 6 months after 14 years of startups. Started out as an engineer in TN, and moved to SF a couple years ago where I got into management just in time to help with rounds of layoffs. Got some severe burnout, quit, and now I’m working on my own products while doing consulting/contracting on the side through my agency. I live fulltime in an RV traveling the country and working remotely. At the moment, I never want to work for someone else again.
- ohthatsnotright 3y ago
  How do you find work? I've been trying to start a similar consultancy but I've had a hard time finding organizations who don't want staff augmentation.
  - bicx 3y ago
    So far, 100% through referrals from my past connections.
_t2bs 3y ago
Really cool - I’m in a similar boat, having created startups and also was a PM in senior roles at a few great companies. I’ve been consulting, which is fine, but wanted something with a little more connection to the project so I just set up https://metaluna.io https://metaluna.io and am aiming for something on the agency route. That said, I really like the way you’re thinking of a “digital project studio”. Is there a community of people doing this somewhere?
bouh 3y ago
Can you tell us a bit more about this creative residence and how did you get accepted there ?
- philip1209 3y ago
  Yes, it's called Almost Perfect. I previously followed the illustrator Luis who co-runs it, and applied back in 2022. https://almostperfect.jp https://almostperfect.jp However, the current "version" of Almost Perfect is ending in about a year, and I think they are fully booked until then: https://www.instagram.com/almostperfecttokyo/p/C2PCMtpS_wq/ https://www.instagram.com/almostperfecttokyo/p/C2PCMtpS_wq/ It's been a fun experience, though - I shared a house with an illustrator from LA. I spent time exploring Tokyo and working on Booklet. At the end, every resident gives a gallery - normally it's visual, such as drawings, but mine became a presentation.
matsemann 3y ago
> And, a fun technicality - I truly self-employed in the sense that I have a salary and a payroll system. That's how most devs here in Norway would do it. Make a "proper" company, where you own 100 % of the shares. Then hire yourself, and pay yourself salary, withhold taxes, pay into a pension program etc. Mainly because if you make good money, it's better to leave some of it in the company (and for instance re-invest it into some index funds or something), instead of taking it out immediately as salary and getting it taxed before re-investing. But then still take enough salary to cover your expenses, get social security benefits etc.
- jacobyoder 3y ago
  doesn't the 'company' itself also pay taxes on the income? For most solo folks in the US, the revenue flows directly to you. You could set up a more complex corporate structure to hold the income that you don't pay to yourself, but that corporation would itself have to pay taxes on the income too. I suspect there's not any real savings/benefit until there's enough 'leftover' money to start getting creative/flexible.
  - rungabajje 3y ago
    Company taxes are paid based on the profit. If you spend all the company income, on salaries or equipment or whatever, there’s no profit, and thus no taxes.
    - matsemann 3y ago
      Yup, it's the same here. So there is a tax on the profit of the year that you let remain in the company, but it's a much lower tax than a wage tax. So it's better to leave it in the company until you need it, instead of paying a high marginal tax rate on taking it out as wage immediately.
    - jacobyoder 3y ago
      Not all expenses are deductible, or 100% deductible in one year. The biggest issue we've seen in software was the 2017 tax act, affecting software R&D starting in 2022. Depending on how you classify those expenses, you could have a sizeable tax bill, even without any 'profit'. But even hardware - that's typically going to be amortized over minimally a few years. Bring in $200k in revenue. Spend $20k on hardware. You may only get to deduct $4k of that hardware expense in each of the next 5 years.
hellojebus 3y ago
Love the comparison against Grand Seiko. I'm a self-proclaimed watch nerd and owner of a Shunbun. Grand Seiko makes beautiful watches!
nlh 3y ago
This is awesome! Nice work. This model was a dream of mine for a while -- I generally love being solo but even a small group of 3-6 people working on a revenue-generating digital product studio has so much potential to be super super fun. Good luck with it and keep us posted!
sixQuarks 3y ago
What is a creative residence?
- philip1209 3y ago
  Kind of like a structured professional sabbatical / workcation with a built-in community and some events. (I paid for it, to be clear.) Here's a video one of the residents made about the program I did: https://vimeo.com/350701368 https://vimeo.com/350701368
  - sixQuarks 3y ago
    Interesting, what did you work on there?
    - philip1209 3y ago
      I've been building Booklet features: https://hq.booklet.group/posts https://hq.booklet.group/posts
pawelwentpawel 3y ago
Same here! I've been running my own digital products (https://flat.social https://flat.social and some smaller ones) and bridging the gap with consulting. For me, the flexibility lead to a fully location-independent lifestyle which allowed me to work from places where I feel at my best. Currently writing this from a tropical patio in Brazil :)
benjaminwootton 3y ago
Isn’t it difficult for one person to market multiple products or websites? It’s hard enough getting traction for one product, let alone a portfolio?
- philip1209 3y ago
  After I sold my last company, I felt like my identity was overly tied to one product. So, I decided to build a company separate from the products, so that over time the products can change but I have a through line company brand. When I started this comapny, I didn't have a product - but I had the holding company (Contraption Company). My first product was Postcard, but now I spend most of my time building Booklet. As the shift in products has happened, my professional email address has been the same, the terms of service have been shared between services, and I have a unified blog + announcements email list. This also means I can launch lightweight experiments such as "FRCTNL", and even if it's not commercially successful - I benefit from compounding returns in the brand and mailing list.
  - mentos 3y ago
    I'm self employed in NYC and its a dream of mine to travel/work in Japan. I've sort of written the idea off that unless I can speak the language its going to be too difficult. Curious if you agree or not.
    - philip1209 3y ago
      I speak zero Japanese. I've met a lot of immigrants here in the last couple of weeks, and it seems that you can get to a working level of Japaneses within a couple of months. After that, it seems that working for a Japanese company IRL is the biggest determinant of becoming fluent. The good news it that Japan seems to be in desperate desire of skilled foreigners, and announced plans this week for a digital nomad visa: https://www.japantimes.co.jp/news/2024/02/02/japan/society/digital-nomad-visa-march/ https://www.japantimes.co.jp/news/2024/02/02/japan/society/d... I've heard that the path from temporary visa to a more permanent one is somewhat straightforward for a self-employed person if you're able to show moderate revenue from Japanese clients.
rainclouds 3y ago
There is someone renting a room around Mount Fuji on AirBNB that advertises themselves as a systems engineer with fiber in the middle of the woods. Sounded like a great place to work to me!
- philip1209 3y ago
  Starlinks are starting to pop up on Airbnb listings.
paulette449 3y ago
I hate to have to ask this but how do you manage healthcare being a solo s-corp? I was under the impression this could only be done through a company if two unrelated family members owned the company? The only other alternative is "Obamacare"? I could be totally wrong.
- whitepoplar 3y ago
  I'd love to know this as well!
- voiceblue 3y ago
  > unrelated family members Is such a thing even possible?
- blatzguzzler 3y ago
  Speaking as someone who has been mostly self-employed since about 2002, Obamacare is a godsend. Massively better than the old individual "underwriting" system that basically made it impossible to get coverage. Yes, health insurance is expensive, but you may be amazed that the ACA marketplace plans frequently cost less than employer plans with better market protections. The only way to do health insurance nowadays is to assume it's only for catastrophes; ie: an $8-15k deductible is nothing compared to a $250k hospital visit. Basically, you are buying a discount plan (your insurer's negotiated rates) plus a stop-loss cover. An example: I am an old fart at 63 and have an HSA plan with a $7,500 deductible. My premium is $900/mo, thus the MOST I will ever have to pay for health care in any 12 month period is $18,300. Way less than a $300k uncomplicated heart attack or a $1M cancer diagnosis. Work your tax returns right, and you can get subsidies that reduce the annual costs even more . . .
  - hotpotamus 3y ago
    It's probably worth remembering this sort of thing when people say there is no difference between the parties. Every Republican voted against it, they almost repealed it, and apparently are gearing up for another crack at repeal https://www.theatlantic.com/politics/archive/2024/01/trump-obamacare-repeal-replace/677067/ https://www.theatlantic.com/politics/archive/2024/01/trump-o... At your age, you'll likely be on Medicare soon either way, but some of us are still decades away.
deleted 3y ago
[deleted]
ryanwaggoner 3y ago
I thought NYC didn’t recognize the S-corp, so you end up paying the corporate tax rate. Has that changed?
- philip1209 3y ago
  Hasn't change, it's pretty terrible but my accountants thought it was marginally better. I've heard that some people get an office outside the city (such as Hoboken) to "work" outside the city.

asim 3y ago

This is super cool! I was/am a startup founder too, bootstrapped an open source project, raised VC money, but ultimately it didn't work out. Now thinking about a solo business again and the studio model was exactly what I was looking at. How did you decide what to build?

philip1209 3y ago
My first product Postcard [1] is a personal website builder. I built that because I thought a personal website maker made logical sense as an indie business, and I wanted a way to stay in touch with friends after I deleted social media. But, it's hard to scale - user acquisition is the name of the game, willingness to pay is lower, the product isn't super differentiated, and I don't have a lot of experience in B2C. So, it makes money and continues to grow - but is small in absolute terms. I decided to work on a more ambitious project that I had been thinking about for years, inspired by a product I wanted at my last startup, and by the chaos of being in 100+ slack channels at a previous job. I hate how people use Discord + Slack - they're good for urgent communications, but we need a "low-attention" version for important communications in communities and at work. So, I started building this product last Summer. Booklet is an async, newsletter-first community platform [2]. Something like Google Groups with the polish of Slack. Booklet's far more complex than Postcard, but plays into my skills more - such as complex permissions systems, email marketing infrastructure, B2B sales, and being able to incorporate all the latest OpenAI goodies quickly. I launched it about three months ago, it has revenue, and I've been scrambling to build things in response to user feedback. I'm thinking of doing a bit of a relaunch next week as some foundational flows come together, such as full PWA support, search, and Stripe member sync. Coincidentally - the project I launched to dogfood Booklet, called FRCTNL [3], is doing quite well. I had no intention of monetizing it, but I included a referral link to the accounting service I use. People have been using that referral link, and last quarter FRCTNL was my highest-earning product. I'm sure in a few years I will have some great stories after the fact about the lessons I was missing in plain sight. But, things feel a little chaotic, uncertain, and fun at the moment. The core theme is building things that I want. My main insight so far has been to build unique, differentiated products that I want to use myself. [1] https://postcard.page https://postcard.page [2] https://booklet.group https://booklet.group [3] https://frctnl.xyz https://frctnl.xyz
- mamidon 3y ago
  Very interesting, I like the idea of frctl. Signed up.
- derzan 3y ago
  What avenues did you go through to reach VC funding? Prior connections, or other points of communication?
  - philip1209 3y ago
    It was a little bit of everything, to be honest.

kgdiem 3y ago

Wow! I’m working on the same thing at https://stackstudio.dev https://stackstudio.dev right now. Your blog post was really eloquent, it’s always inspiring when someone else shares your idea. Best of luck.

philip1209 3y ago
Thanks! I'm trying to do more essay writing there [1]. Most indie makers seem to have some content strategy where they share their story. I avoid social media and don't desire to become a Youtuber, so I'm focusing on writing as a content channel. I'm focusing essays on my creative process, inspiration, and specific experiences as an operator - the stuff I want to read. I'm avoiding prospective predictions about the future, being negative (an actual self-imposed rule), and talking about things that feel more like theory than practice. The next piece I plan to publish tomorrow will be a recap of a talk I gave over the weekend, covering how most of our knowledge work practices come from factories, and ways software engineers are at the forefront of changing those industrial-era practices. P.S. - if you're ever in NYC, come join for a dinner of Dimes Square Ventures [2], which is a little community I run for local indie makers (using Booklet!) [1] https://contraption.co/essays https://contraption.co/essays [2] https://dimessquareventures.com https://dimessquareventures.com
- kgdiem 3y ago
  I live in Hoboken :D sending you an email for dimessquare!

bicx 3y ago

I have a similar story. I’ve been self-employed for the last 6 months after 14 years of startups. Started out as an engineer in TN, and moved to SF a couple years ago where I got into management just in time to help with rounds of layoffs. Got some severe burnout, quit, and now I’m working on my own products while doing consulting/contracting on the side through my agency. I live fulltime in an RV traveling the country and working remotely. At the moment, I never want to work for someone else again.

ohthatsnotright 3y ago
How do you find work? I've been trying to start a similar consultancy but I've had a hard time finding organizations who don't want staff augmentation.
- bicx 3y ago
  So far, 100% through referrals from my past connections.

_t2bs 3y ago

Really cool - I’m in a similar boat, having created startups and also was a PM in senior roles at a few great companies. I’ve been consulting, which is fine, but wanted something with a little more connection to the project so I just set up https://metaluna.io https://metaluna.io and am aiming for something on the agency route. That said, I really like the way you’re thinking of a “digital project studio”. Is there a community of people doing this somewhere?

bouh 3y ago

Can you tell us a bit more about this creative residence and how did you get accepted there ?

philip1209 3y ago
Yes, it's called Almost Perfect. I previously followed the illustrator Luis who co-runs it, and applied back in 2022. https://almostperfect.jp https://almostperfect.jp However, the current "version" of Almost Perfect is ending in about a year, and I think they are fully booked until then: https://www.instagram.com/almostperfecttokyo/p/C2PCMtpS_wq/ https://www.instagram.com/almostperfecttokyo/p/C2PCMtpS_wq/ It's been a fun experience, though - I shared a house with an illustrator from LA. I spent time exploring Tokyo and working on Booklet. At the end, every resident gives a gallery - normally it's visual, such as drawings, but mine became a presentation.

matsemann 3y ago

> And, a fun technicality - I truly self-employed in the sense that I have a salary and a payroll system. That's how most devs here in Norway would do it. Make a "proper" company, where you own 100 % of the shares. Then hire yourself, and pay yourself salary, withhold taxes, pay into a pension program etc. Mainly because if you make good money, it's better to leave some of it in the company (and for instance re-invest it into some index funds or something), instead of taking it out immediately as salary and getting it taxed before re-investing. But then still take enough salary to cover your expenses, get social security benefits etc.

jacobyoder 3y ago
doesn't the 'company' itself also pay taxes on the income? For most solo folks in the US, the revenue flows directly to you. You could set up a more complex corporate structure to hold the income that you don't pay to yourself, but that corporation would itself have to pay taxes on the income too. I suspect there's not any real savings/benefit until there's enough 'leftover' money to start getting creative/flexible.
- rungabajje 3y ago
  Company taxes are paid based on the profit. If you spend all the company income, on salaries or equipment or whatever, there’s no profit, and thus no taxes.
  - matsemann 3y ago
    Yup, it's the same here. So there is a tax on the profit of the year that you let remain in the company, but it's a much lower tax than a wage tax. So it's better to leave it in the company until you need it, instead of paying a high marginal tax rate on taking it out as wage immediately.
  - jacobyoder 3y ago
    Not all expenses are deductible, or 100% deductible in one year. The biggest issue we've seen in software was the 2017 tax act, affecting software R&D starting in 2022. Depending on how you classify those expenses, you could have a sizeable tax bill, even without any 'profit'. But even hardware - that's typically going to be amortized over minimally a few years. Bring in $200k in revenue. Spend $20k on hardware. You may only get to deduct $4k of that hardware expense in each of the next 5 years.

hellojebus 3y ago

Love the comparison against Grand Seiko. I'm a self-proclaimed watch nerd and owner of a Shunbun. Grand Seiko makes beautiful watches!

nlh 3y ago

This is awesome! Nice work. This model was a dream of mine for a while -- I generally love being solo but even a small group of 3-6 people working on a revenue-generating digital product studio has so much potential to be super super fun. Good luck with it and keep us posted!

sixQuarks 3y ago

What is a creative residence?

philip1209 3y ago
Kind of like a structured professional sabbatical / workcation with a built-in community and some events. (I paid for it, to be clear.) Here's a video one of the residents made about the program I did: https://vimeo.com/350701368 https://vimeo.com/350701368
- sixQuarks 3y ago
  Interesting, what did you work on there?
  - philip1209 3y ago
    I've been building Booklet features: https://hq.booklet.group/posts https://hq.booklet.group/posts

pawelwentpawel 3y ago

Same here! I've been running my own digital products (https://flat.social https://flat.social and some smaller ones) and bridging the gap with consulting. For me, the flexibility lead to a fully location-independent lifestyle which allowed me to work from places where I feel at my best. Currently writing this from a tropical patio in Brazil :)

benjaminwootton 3y ago

Isn’t it difficult for one person to market multiple products or websites? It’s hard enough getting traction for one product, let alone a portfolio?

philip1209 3y ago
After I sold my last company, I felt like my identity was overly tied to one product. So, I decided to build a company separate from the products, so that over time the products can change but I have a through line company brand. When I started this comapny, I didn't have a product - but I had the holding company (Contraption Company). My first product was Postcard, but now I spend most of my time building Booklet. As the shift in products has happened, my professional email address has been the same, the terms of service have been shared between services, and I have a unified blog + announcements email list. This also means I can launch lightweight experiments such as "FRCTNL", and even if it's not commercially successful - I benefit from compounding returns in the brand and mailing list.
- mentos 3y ago
  I'm self employed in NYC and its a dream of mine to travel/work in Japan. I've sort of written the idea off that unless I can speak the language its going to be too difficult. Curious if you agree or not.
  - philip1209 3y ago
    I speak zero Japanese. I've met a lot of immigrants here in the last couple of weeks, and it seems that you can get to a working level of Japaneses within a couple of months. After that, it seems that working for a Japanese company IRL is the biggest determinant of becoming fluent. The good news it that Japan seems to be in desperate desire of skilled foreigners, and announced plans this week for a digital nomad visa: https://www.japantimes.co.jp/news/2024/02/02/japan/society/digital-nomad-visa-march/ https://www.japantimes.co.jp/news/2024/02/02/japan/society/d... I've heard that the path from temporary visa to a more permanent one is somewhat straightforward for a self-employed person if you're able to show moderate revenue from Japanese clients.

rainclouds 3y ago

There is someone renting a room around Mount Fuji on AirBNB that advertises themselves as a systems engineer with fiber in the middle of the woods. Sounded like a great place to work to me!

philip1209 3y ago
Starlinks are starting to pop up on Airbnb listings.

paulette449 3y ago

I hate to have to ask this but how do you manage healthcare being a solo s-corp? I was under the impression this could only be done through a company if two unrelated family members owned the company? The only other alternative is "Obamacare"? I could be totally wrong.

whitepoplar 3y ago
I'd love to know this as well!
voiceblue 3y ago
> unrelated family members Is such a thing even possible?
blatzguzzler 3y ago
Speaking as someone who has been mostly self-employed since about 2002, Obamacare is a godsend. Massively better than the old individual "underwriting" system that basically made it impossible to get coverage. Yes, health insurance is expensive, but you may be amazed that the ACA marketplace plans frequently cost less than employer plans with better market protections. The only way to do health insurance nowadays is to assume it's only for catastrophes; ie: an $8-15k deductible is nothing compared to a $250k hospital visit. Basically, you are buying a discount plan (your insurer's negotiated rates) plus a stop-loss cover. An example: I am an old fart at 63 and have an HSA plan with a $7,500 deductible. My premium is $900/mo, thus the MOST I will ever have to pay for health care in any 12 month period is $18,300. Way less than a $300k uncomplicated heart attack or a $1M cancer diagnosis. Work your tax returns right, and you can get subsidies that reduce the annual costs even more . . .
- hotpotamus 3y ago
  It's probably worth remembering this sort of thing when people say there is no difference between the parties. Every Republican voted against it, they almost repealed it, and apparently are gearing up for another crack at repeal https://www.theatlantic.com/politics/archive/2024/01/trump-obamacare-repeal-replace/677067/ https://www.theatlantic.com/politics/archive/2024/01/trump-o... At your age, you'll likely be on Medicare soon either way, but some of us are still decades away.

deleted 3y ago

[deleted]

ryanwaggoner 3y ago

I thought NYC didn’t recognize the S-corp, so you end up paying the corporate tax rate. Has that changed?

philip1209 3y ago
Hasn't change, it's pretty terrible but my accountants thought it was marginally better. I've heard that some people get an office outside the city (such as Hoboken) to "work" outside the city.