11 ms·

$30k/week? Would love to read more about how that worked. I thought my $180/hour with $1k per diem for on-site was phenomenal. Jeez, I need to charge more.

by fixxer 12y ago

andy_adams 12y ago
FYI, $180/hour is phenomenal by nearly anyone's standards. Nothing wrong with pushing for higher, just don't get worked up trying to keep up with the McKenzies.
- tptacek 12y ago
  $1440/day is a decent middling daily rate. Specialize, and bear in mind that you can actually specialize in charging more.
  - deleted 12y ago
    [deleted]
  - sarciszewski 12y ago
    "you can actually specialize in charging more" Okay, there was probably a post that explained what you mean here and I missed it. How does "I cost more?" become a specialty?
    - tptacek 12y ago
      It changes which projects you get, and alters the opportunity cost of the projects you end up spending time on.
      - sarciszewski 12y ago
        This makes sense. Sort of, "If you charge more, you'll find yourself a specialist."
        cat9 12y ago
        If you charge more, people don't bother you with nearly as much low-ROI scut work, which means you (assuming you can deliver) find yourself focusing on more interesting & more valuable work that has a stronger connection to attracting and keeping high-value clients.
        davidw 12y ago
        Well, that, or you can't find work at all.
        chc 12y ago
        Yes, there's an Underpants Gnomes quality to this sort of career advice. It's not bad, but there's a giant "?" in the middle that nobody can really help you with, which seems to involve accumulating a huge base of clients beating down your door.
        sarciszewski 12y ago
        Personal and business relationships vary from person to person. I guess the assumption is that, if you are skilled enough at engineering and marketing, you will find yourself getting clients and make money hand over fist. Unfortunately for me, I'm purely a technology guy, not a people person.
        roel_v 12y ago
        "Unfortunately for me, I'm purely a technology guy, not a people person." This is bullshit. People can change. You can change yourself. 'I only do tech' is an excuse to not have to go outside your comfort zone. Of course it's a big change. Of course it's scary. Of course you don't know exactly how to get from A to B. But just giving up with a 'this is how I was born' is defeatism.
        deleted 12y ago
        [deleted]
    - fixxer 12y ago
      I think what he means is that with higher rates, you get the luxury of domain specialization.
      - tptacek 12y ago
        That's also true but I literally mean "you can specialize in having higher rates"; I'm not just saying "if you have higher rates you'll have free time to find more lucrative specialties". You can change nothing else about your practice but your bill rate and have a good chance of succeeding.
        sarciszewski 12y ago
        What happens when you hit a bill rate that nobody wants to pay? (e.g. $50k/week or something ridiculous) There has to be a limiting factor somewhere.
        nostrademons 12y ago
        The limiting factor is how much value you add to their business. That can be a lot, eg. I could easily imagine patio11 adding $50K of value in a week's time by introducing a marketing campaign that sells $500K of product, or Matasano adding that much value by fixing a security hole that would cost more than $1M in lost goodwill. One of my fiancee's B-school professors specializes in pricing theory. He can make several million dollars in one consulting engagement, because he tells companies where they should price their products to maximize revenue, and so he just needs to charge some fraction of ($new_revenue - $old_revenue), which is usually measured in millions.
        waterlesscloud 12y ago
        While I accept this is likely true, I still have a hard time incorporating it into my thinking. I think I spent too much time as an employee, a relationship in which every increase in salary needs elaborate over-justification. Consulting isn't like that.
        12y ago
    - DanielBMarkham 12y ago
      Think of it as a machine, a big funnel. Narrow your skills and experience, pump more people into the top of the funnel, increase your ability to charge more. (But of course you only get what you ask for)
rawnlq 12y ago
He does a year-in-review blog post every year where he publishes his financials publicly. They are very informative. http://www.kalzumeus.com/2014/12/22/kalzumeus-software-year-in-review-2014/ http://www.kalzumeus.com/2014/12/22/kalzumeus-software-year-... http://www.kalzumeus.com/2014/01/06/kalzumeus-software-year-in-review-2013/ http://www.kalzumeus.com/2014/01/06/kalzumeus-software-year-... http://www.kalzumeus.com/2012/12/29/bingo-card-creator-and-other-stuff-year-in-review-2012/ http://www.kalzumeus.com/2012/12/29/bingo-card-creator-and-o...
weaksauce 12y ago
I'm curious what justification you use for a daily allowance of $1,000. Are you renting ferraris, eating fabulous lunches and dinners, and staying in a plush hotel? Or do you not mean per diem in the literal sense?
- fixxer 12y ago
  I hate going on-site. It is a waste of time. It is a "go away" price. EDIT: And companies routinely pay for it.
  - viggity 12y ago
    care to share your line of business?
    - fixxer 12y ago
      in between software engineer and ds these days
      - viggity 12y ago
        ds = data scientist?
        fixxer 12y ago
        Correct.
- tomjen3 12y ago
  Careful, you are thinking in terms of cost plus here. Don't. If companies are willing to pay him 1000 usd per diem then he should demand 1440 and haggle from there.
  - weaksauce 12y ago
    I wasn't really thinking in terms of cost plus but I have never heard of a per diem being anything more than something to cover expenses while traveling. My understanding of a per diem is not meant to be a daily bonus. If they pay it then it's all the better for the op. I was more curious how much blowback the gp has gotten on a large per diem like that and how they would go about countering it for my own personal use.
tomjen3 12y ago
Patio11 is basically the "charge more" guy. His advice is nearly always "charge more". It is no wonder he gets payed a lot more than you.
- chc 12y ago
  He's also a guy who commented toward the end of his consulting career that going out to look for clients rather than having them just appear unasked-for was kind of a new thing for him. I think this also has a lot to do with his above-average income.
  - ForHackernews 12y ago
    I wish I knew more about how to get to that point where clients would find me.
    - hackerboos 12y ago
      Reputation helps enormously. Patrick is always blogging and it's made him well known.
larrys 12y ago
"Would love to read more about how that worked. I thought my $180/hour with $1k per diem for on-site was phenomenal. Jeez, I need to charge more." Maybe not so fast. To me the 30k is (most likely) editorial hyperbole which is not to say Patrick didn't make $30k on some weeks. If you can make (repeatedly) 30k per week (or even 15k per week) that's a boatload of money on a yearly basis. So I would imagine that while Patrick had 1 or 5 jobs that might have paid that much, he determined that there would not be a continuing stream of work at that rate. Multiply that by 52 and see what you come up with. If you could continue to charge that kind of money (and perceived a continuing demand) you could most certainly afford to hire someone to offload some of the work that is done (both admin, sales and actual consulting) to less qualified people that you could then oversee. After all not everything that a consultant like Patrick does needs to be done by Patrick. Similar to what attorneys do and other consulting firms do. It is no secret to anyone who is in business that there is elasticity in pricing such that you can jack up prices on some occasions and some people will pay those rates. As such it's possible that you (the parent comment) are charging (at the rates you are charging) less than your value. But it's also possible that you would get drastically less work if you charged more than your per diem offsite. Even if a large consulting firm is able to charge 5x as much. (Or Patrick). As a general rule, what I have found with pricing, is that it often pays to charge on a per project basis as opposed to a time basis. I find this to be true in both how I charge (I do a small amount of consulting on the side (not the main thing I do, but close to 6 figures last year)) and how I buy consulting. If I need something done and the person says "$5000 for the project" that is easier to spend to "solve a problem" then $750 per hour or "$1000 per hour and it will take me 5 hours". See the difference? On the other hand if you perceive the total cost of the project is many hours and you are willing to sell those hours for $100 per hour it may pay to price like that. It all depends on the circumstance.
- richardw 12y ago
  52-week year rate isn't the attraction for me. I'd rather focus on the lifestyle and opportunities provided by a few weeks a year at $30k a week.

$30k/week? Would love to read more about how that worked. I thought my $180/hour with $1k per diem for on-site was phenomenal. Jeez, I need to charge more.

by fixxer 12y ago

$30k/week? Would love to read more about how that worked. I thought my $180/hour with $1k per diem for on-site was phenomenal. Jeez, I need to charge more.

andy_adams 12y ago

FYI, $180/hour is phenomenal by nearly anyone's standards. Nothing wrong with pushing for higher, just don't get worked up trying to keep up with the McKenzies.

tptacek 12y ago
$1440/day is a decent middling daily rate. Specialize, and bear in mind that you can actually specialize in charging more.
- deleted 12y ago
  [deleted]
- sarciszewski 12y ago
  "you can actually specialize in charging more" Okay, there was probably a post that explained what you mean here and I missed it. How does "I cost more?" become a specialty?
  - tptacek 12y ago
    It changes which projects you get, and alters the opportunity cost of the projects you end up spending time on.
    - sarciszewski 12y ago
      This makes sense. Sort of, "If you charge more, you'll find yourself a specialist."
      - cat9 12y ago
        If you charge more, people don't bother you with nearly as much low-ROI scut work, which means you (assuming you can deliver) find yourself focusing on more interesting & more valuable work that has a stronger connection to attracting and keeping high-value clients.
        davidw 12y ago
        Well, that, or you can't find work at all.
        chc 12y ago
        Yes, there's an Underpants Gnomes quality to this sort of career advice. It's not bad, but there's a giant "?" in the middle that nobody can really help you with, which seems to involve accumulating a huge base of clients beating down your door.
        sarciszewski 12y ago
        Personal and business relationships vary from person to person. I guess the assumption is that, if you are skilled enough at engineering and marketing, you will find yourself getting clients and make money hand over fist. Unfortunately for me, I'm purely a technology guy, not a people person.
        roel_v 12y ago
        "Unfortunately for me, I'm purely a technology guy, not a people person." This is bullshit. People can change. You can change yourself. 'I only do tech' is an excuse to not have to go outside your comfort zone. Of course it's a big change. Of course it's scary. Of course you don't know exactly how to get from A to B. But just giving up with a 'this is how I was born' is defeatism.
        deleted 12y ago
        [deleted]
  - fixxer 12y ago
    I think what he means is that with higher rates, you get the luxury of domain specialization.
    - tptacek 12y ago
      That's also true but I literally mean "you can specialize in having higher rates"; I'm not just saying "if you have higher rates you'll have free time to find more lucrative specialties". You can change nothing else about your practice but your bill rate and have a good chance of succeeding.
      - sarciszewski 12y ago
        What happens when you hit a bill rate that nobody wants to pay? (e.g. $50k/week or something ridiculous) There has to be a limiting factor somewhere.
        nostrademons 12y ago
        The limiting factor is how much value you add to their business. That can be a lot, eg. I could easily imagine patio11 adding $50K of value in a week's time by introducing a marketing campaign that sells $500K of product, or Matasano adding that much value by fixing a security hole that would cost more than $1M in lost goodwill. One of my fiancee's B-school professors specializes in pricing theory. He can make several million dollars in one consulting engagement, because he tells companies where they should price their products to maximize revenue, and so he just needs to charge some fraction of ($new_revenue - $old_revenue), which is usually measured in millions.
      - waterlesscloud 12y ago
        While I accept this is likely true, I still have a hard time incorporating it into my thinking. I think I spent too much time as an employee, a relationship in which every increase in salary needs elaborate over-justification. Consulting isn't like that.
        12y ago
  - DanielBMarkham 12y ago
    Think of it as a machine, a big funnel. Narrow your skills and experience, pump more people into the top of the funnel, increase your ability to charge more. (But of course you only get what you ask for)

rawnlq 12y ago

He does a year-in-review blog post every year where he publishes his financials publicly. They are very informative. http://www.kalzumeus.com/2014/12/22/kalzumeus-software-year-in-review-2014/ http://www.kalzumeus.com/2014/12/22/kalzumeus-software-year-... http://www.kalzumeus.com/2014/01/06/kalzumeus-software-year-in-review-2013/ http://www.kalzumeus.com/2014/01/06/kalzumeus-software-year-... http://www.kalzumeus.com/2012/12/29/bingo-card-creator-and-other-stuff-year-in-review-2012/ http://www.kalzumeus.com/2012/12/29/bingo-card-creator-and-o...

weaksauce 12y ago

I'm curious what justification you use for a daily allowance of $1,000. Are you renting ferraris, eating fabulous lunches and dinners, and staying in a plush hotel? Or do you not mean per diem in the literal sense?

fixxer 12y ago
I hate going on-site. It is a waste of time. It is a "go away" price. EDIT: And companies routinely pay for it.
- viggity 12y ago
  care to share your line of business?
  - fixxer 12y ago
    in between software engineer and ds these days
    - viggity 12y ago
      ds = data scientist?
      - fixxer 12y ago
        Correct.
tomjen3 12y ago
Careful, you are thinking in terms of cost plus here. Don't. If companies are willing to pay him 1000 usd per diem then he should demand 1440 and haggle from there.
- weaksauce 12y ago
  I wasn't really thinking in terms of cost plus but I have never heard of a per diem being anything more than something to cover expenses while traveling. My understanding of a per diem is not meant to be a daily bonus. If they pay it then it's all the better for the op. I was more curious how much blowback the gp has gotten on a large per diem like that and how they would go about countering it for my own personal use.

tomjen3 12y ago

Patio11 is basically the "charge more" guy. His advice is nearly always "charge more". It is no wonder he gets payed a lot more than you.

chc 12y ago
He's also a guy who commented toward the end of his consulting career that going out to look for clients rather than having them just appear unasked-for was kind of a new thing for him. I think this also has a lot to do with his above-average income.
- ForHackernews 12y ago
  I wish I knew more about how to get to that point where clients would find me.
  - hackerboos 12y ago
    Reputation helps enormously. Patrick is always blogging and it's made him well known.

larrys 12y ago

"Would love to read more about how that worked. I thought my $180/hour with $1k per diem for on-site was phenomenal. Jeez, I need to charge more." Maybe not so fast. To me the 30k is (most likely) editorial hyperbole which is not to say Patrick didn't make $30k on some weeks. If you can make (repeatedly) 30k per week (or even 15k per week) that's a boatload of money on a yearly basis. So I would imagine that while Patrick had 1 or 5 jobs that might have paid that much, he determined that there would not be a continuing stream of work at that rate. Multiply that by 52 and see what you come up with. If you could continue to charge that kind of money (and perceived a continuing demand) you could most certainly afford to hire someone to offload some of the work that is done (both admin, sales and actual consulting) to less qualified people that you could then oversee. After all not everything that a consultant like Patrick does needs to be done by Patrick. Similar to what attorneys do and other consulting firms do. It is no secret to anyone who is in business that there is elasticity in pricing such that you can jack up prices on some occasions and some people will pay those rates. As such it's possible that you (the parent comment) are charging (at the rates you are charging) less than your value. But it's also possible that you would get drastically less work if you charged more than your per diem offsite. Even if a large consulting firm is able to charge 5x as much. (Or Patrick). As a general rule, what I have found with pricing, is that it often pays to charge on a per project basis as opposed to a time basis. I find this to be true in both how I charge (I do a small amount of consulting on the side (not the main thing I do, but close to 6 figures last year)) and how I buy consulting. If I need something done and the person says "$5000 for the project" that is easier to spend to "solve a problem" then $750 per hour or "$1000 per hour and it will take me 5 hours". See the difference? On the other hand if you perceive the total cost of the project is many hours and you are willing to sell those hours for $100 per hour it may pay to price like that. It all depends on the circumstance.

richardw 12y ago
52-week year rate isn't the attraction for me. I'd rather focus on the lifestyle and opportunities provided by a few weeks a year at $30k a week.