If I were running a consultancy full-time, and didn't hire anyone, I'd model that as 35 billed weeks a year at $30k. Travel to a client is billed to the client separately via a magical sentence that Thomas taught me: "I will expense travel as per your standard travel policy." I'd assume roughly $50k to $100k in overhead (legal and tax advice, travel to conferences to do prospecting, etc).
I have never ran a consultancy full-time, and didn't particularly want to start now. It was certainly an option, but spending a few years building Atlas seems much more fulfilling.
Travel to a client is billed to the client separately via a magical sentence that Thomas taught me: "I will expense travel as per your standard travel policy."
How does that work exactly? I mean, logistically -- if you're coming in from outside, you generally won't know what their standard travel policy is.
Pitch the gig, sign the contract, then you do the boring logistical details. One of them is arranging travel. At my shop that was simple: "How doed $FOO handle business travel? Are you going to book my tickets/hotel or would you prefer to be invoiced for them?" "Great; send me a copy of your travel policy."
I also thought, early in my consulting career, this would be a big deal. It never was. Nobody who can hire 10 programmers is surprised what a trip from Nagoya to SF or NYC or Berlin costs.
What you're doing is putting the client on notice that (a) you're going to have to travel to complete the engagement and (b) they're on the hook for it. From there, things usually proceed as if you were an employee rather than a consultant: you ask them how you should book the travel, and you get it reimbursed later on.
I think you ask. Rephrased, "I expect to be reimbursed for travel, but will try to keep my airfare/hotel/per diem expenses in line with what your employees get. (Hint: provide me a copy of this policy.)"
Yes, I think it's approximately as straightforward as building a SaaS company from scratch. Which is to say "non-trivial" but very, very within the realm of possibibility.
I've written a ton on this topic, on HN and my blog. So has Thomas, among many others.
Professional services can be very lucrative; film at 11. My lawyer charges $750 an hour and my accountant $600. I have no difficulty believing they have 70% utilization. I know there are HNers that find this difficult to credit. If you take nothing else from the 3 million words I've written, take "you can charge vastly more for your skill set than you do if you connect the deliverables directly to business value." (True for consulting, regular employment, selling products, etc.)
It's boringly straightforward to scale the business after you've done it once. Success breeds success; you ask your newly satisfied client for referrals and follow-on work, you use case studies made with them to target firms at similar or slightly higher levels of sophistication, you turn the one-off engagement into something that you can predictably pitch and execute like a restaurant can predictably cook eggs to order, etc.
I don't know if Patrick could do that, but I've been on the other side of deals materially equivalent to those numbers.
A 30k rack rate at those utilization rate is a high number but not an impossible one.
It is not a number you will get for software contracting. It's one you'll get for solving business problems that cost/are worth much more to your clients than that.
I don't doubt it. I've certainly seen people bill similarly (and obviously it doesn't involve writing that much code) - I'm just trying to put the pieces together in this context.
I have never ran a consultancy full-time, and didn't particularly want to start now. It was certainly an option, but spending a few years building Atlas seems much more fulfilling.