Originally published on Inc Magazine’s Process Playbook column by Chris Ronzio
As entrepreneurs, we have the luxury of building our business around our lives, our hobbies, or even the terrifying prospect of fatherhood.
Like most entrepreneurs, my business model has taken a few twists and turns over the years.
You can accomplish a lot in a quarter, and with three quarters of fair warning (aka three trimesters), you might be able to change your business model entirely, like I did.
Here’s how my two little boys pivoted my business, long before they could pronounce my company name.
The Project Model: Getting started
In 2013, I started consulting on systems and processes for other entrepreneurs. With no employees, I was the lone salesperson.
This model worked for me and my wife at the time. Some months would be really busy, but also really profitable. Other months I’d be in between engagements, so we’d plan a vacation and enjoy the time off.
I found out my wife was pregnant in December of 2013, and as excited as I was, I couldn’t shake the deep fear that I had inside: What if I couldn’t hunt down our next meal?
I needed some consistency. So, as my wife’s belly grew, the first shift in my new business started to take shape.
The Retainer Model: Creating consistency
As an early consulting business, I was charging for my time. The more clients I won, the more I increased my rate, from $40 an hour to nearly $400 an hour. And when things were good, things were really good.
But, with a baby on the way, I knew I wanted to be around more. I wanted more consistency, and more predictability.
So, I converted my business to a flat monthly retainer model. Companies would sign up for a three or six month package, and agree to pay a monthly fee for a regular schedule together.
I was still solo, and I was still selling my time, but I went from billing hourly to filling four-hour slots on my calendar six months in advance. The results were incredible.
I signed on more clients, and set everyone to bill at the beginning of the month, before we ever sat down together.
If your schedule is filled with tiny projects for hourly clients, think about how you too can shift to a model with predictable, monthly payments for your service.
Soon, I had more clients than I could handle and I needed some help.
The Agency Model: Billing for a team
In 2015, as we neared my first son’s first birthday, it became obvious that I needed a team to support my growing business and free up my time.
My full schedule was a blessing and a curse. I had more of a lucrative job than a lucrative business. So, I hired my first employee.
With this change, I was able to hand off some administrative work like scheduling, invoicing, research, and creating reports.
Instead of 4-hour work sessions, I was booking 1-hour planning meetings and leveraging my team to help get the work done.
My time was divided between managing clients and managing my new team, and while I was still logging 60+ hour weeks, those hours were more flexible.
Things were improving, until I came home one day and my wife announced pregnancy number two.
The countdown started toward my next business model pivot.
The Value Model: Scaling a product
Despite an efficient consulting operation and a great team, we could only impact so many companies. I was working less directly with clients, but the company was still focused on trading time for money, and we needed some leverage.
How could we take what we learned and serve the masses? That thought raced through my mind every night.
Looking back, the most scalable part of my consulting business was a small software tool we created for clients to document their processes, called Trainual. So, as our due date approached, we feverishly worked to revamp and relaunch the software.
Eight days before my second son was born, the new app was born; a SaaS product with monthly recurring revenue not tied directly to our time, only to the value that we create.
I’ve always strived to build my business around my life, and not build my life around my business.
I wanted consistency, and the retainer model accomplished that.
I wanted flexibility, and I found that through growing my team.
I wanted to scale more widely, which Trainual is enabling.
As you think about your business, decide what you value most before you decide how to deliver what you do.
Becoming a dad has shifted my business for the better.
But, if my wife is reading this, please, no more pivots in the near future.