
Ask YC: how to best make money on the side? - Tichy
The need to earn money is once again weighing down on me. Realistically I don't see any of my projects support me financially in the near future. The obvious choice seemks to do consulting, but my experiences were not so good. I usually don't manage to work on my own projects in parallel with consulting jobs. Typical contracts for me took several months, and afterwards felt like a waste of time (except for my bank account being happy). Small web design contracts usually don't pay very well, and don't require much programming. I am not a designer, so I would have to share the deal with a designer, which makes it economically uninteresting. <p>What kind of arrangements have worked for you?
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DanielBMarkham
Consulting can be a rewarding experience. You have pointed out all the bad
parts, and I agree. But where else can you see how so many businesses are run?
Every company that is paying you to do technical work has already provided
enough value to their users that they can afford to pay you. That means they
must be doing something right. Learning how they provide value, how they
decide to fund or de-fund IT projects, learning how it's easy to hack a small
system but not so easy when you've got 12 thousand coders and a huge legacy
base -- these are all lessons that you'll need to know if you want to start a
business that is going to grow.

Plus the money is good, no?

~~~
Tichy
I learned a lot through my consulting work, and I met interesting people and
some new friends. It is just that it is taking up too much time. Even 3
months, which might be a kind of a minimum contract, is almost 1% of the
productive time I might have left in my life, if I consider another 30 years
in the workforce. I hope to be productive longer than that, but who knows.

I wish I could find more interesting contracts, but I am pretty much
pigeonholed into Java Web Applications.

Today I finally received the "Collective Intelligence" book in the mail, it is
so much fun (I always wanted to do things like that). Perhaps if I focus my
projects on doing stuff like that, I could acquire different kinds of
contracts. So far most of my own projects are also just "normal" web
applications, because I try to make money. Mistake? I believe in the "do what
you love and you will be successful" mantra, but in reality I still tend to
make compromises with the projects I choose (because of the money scare).

~~~
DanielBMarkham
I'm a married guy, so I feel a little better about "selling out" and doing
some consulting. I've also moved up the food chain from development into
strategic technology management consulting, so when I say "consulting", it's
probably a little different than when you say it.

It all has to do with risk profile -- how much risk are you comfortable with?
You always hear these stories about founders who made it work just running on
credit cards and family loans until they took off. But what happens if you
don't take off? You can only max out your cards and family loans every so
often. So there's short-term risk like "let's live on noodles and saltines for
the next six months" and then there's long-term risk like "I'm going to go
bankrupt, lose my house, and my wife is going to leave me". If you're single
without a lot of commitments, go for more risk and chase your dream. But
remember that even if you get your dream, life is always about compromise.

But if you decide to go to some kind of hourly-rate consulting for a while,
take my advice and stretch your skills some. Instead of just Java Web apps, be
a team lead for project, or an architect. I think as nerd we focus on the
technical aspects of a project, but there are all kinds of good business
lessons in there that can help you with your startup, if you go looking for
them. YMMV

~~~
Tichy
I don't want to demean consulting at all, I guess I just haven't managed to
get into the fun consulting jobs yet. But I also feel the "family pressure", I
am certainly not the "gamble away your family" kind of risk person.

~~~
DanielBMarkham
I've had consulting gigs that basically made me team leader of a 5-person
startup team.

Now how is that different than being a cofounder? I got paid more, and I was
able to move on to other contracts without a lot of fuss.

But most of the time, selling yourself by the hour (or day or project) sucks.
You're always making somebody else's dream come true instead of your own.
Having said that, money is a good thing! And over time you can get better and
better at your skills. I guess there is a difference between honing your
skills doing stuff for other people and honing your skills doing stuff for
yourself. Sure, I'd much rather work for myself, but there's no reason to
throw the baby out with the bath water.

~~~
dpapathanasiou
_selling yourself by the hour (or day or project) sucks. You're always making
somebody else's dream come true instead of your own._

Another (potentially big) problem is IP ownership, if your paying client tries
to claim that the work on your own project is really theirs.

~~~
DanielBMarkham
That's a really good point. If you're moving back and forth between startups
and consulting, be sure you know where all o the IP landmines are. I know I
have a three-page IP disclosure sheet I include with all of my consulting
projects, plus I make sure that my continuing work on my startup is noted.
Even then, it can get tricky. I couldn't take a consulting gig in the same
industry that the startup was in unless we had a lot of legal input. And that
gets expensive.

The problem is that if you're writing Web 2.0 apps then really _anything_
could be considered close to anything else. Writing a 3-D chat program for
E-Bayers? Any business with a web site might could use a chat program, and if
you have access to their site and their plans, who's to say what parts of your
ideas you're getting from them and what parts you're coming up with yourself?

~~~
ratsbane
Your comment about the IP disclosure sheet is good. I'd like to see more
discussion on this board about how to handle IP disclosure before taking on
consulting projects. I don't have the answers but the question is very
relevant to me and, I suspect, a lot of other people here.

------
jdavid
I have a sweet deal now, where I choose my own consulting hours. The company I
work for puts up with it because they feel like, because of my start up, I can
keep them on the edge of cool and now. If I did not have that freedom, then I
would not be able to keep in tune.

On the flip side I am always telling my self that each hour I spend on
consulting, is one that I am not spending on my company.

For now, we are trying to think of ways to increase our day one revenue for
our company so that we can stop consulting sooner.

We have considered other options too like offering a sliding pay rate
depending on the number of hours per week we are consulting. At less than 20
hours per week, we might charge 50$ per hour, where hours over 20, we might
charge 150$ for those impatient customers. Hours would be pre-booked. We have
yet to try it, but WE ARE STRONGLY considering it.

Something else we have thought about, is having a consulting division to
manage our time, our rate, and to increase our marketability as a group. As a
company we might be able to bill out of the gate at 150$ an hour, vs. as an
individual we might be able to bill at 50-75$ per hour. This would also give
us a way to charge for custom features.

Some thoughts on our side, now that we did not get into YC, we need to figure
out how to stick around long enough to turn a profit.

We also got an offer from a local marketing company, that is interested in
what we have, but we do not yet know how to productize what we have for them
and licence it.

------
edw519
The only way I have figured out how to do both is by dedicating each day to
one or the other. For now: Monday and Wednesday: consulting. All day Tues,
Thurs, Fri, Sat, Sunday: my startup. I don't even bother trying to work on my
startup on Monday or Wednesday night. Any user requests from my clients are
held until Monday and Wednesday. I even have them trained to email me: no more
interruptions.

This way I get the best of both worlds. Try it.

~~~
Tichy
What kind of consulting work do you do? It sounds as if you can work from
home? I usually work on site. There were some projects where I could work from
home, and I liked it, but they tended to be the smaller ones that yielded less
money.

Edit: anyway, good advice, I will try it ;-)

~~~
edw519
I do contracting programming for local small businesses on their legacy
systems. Has nothing to do with my startup, but is great experience anyway.
Things come up that I could never envision, but I'll remember, so my software
won't ever have these problems. I can dial up from home or work at their
office. One client even gave me my own cubicle. I usually work at their site
for several reasons: makes up for the loneliness of the other days, some
projects have to be done on site (printers, phones, network, etc.), and, most
of all, I want to see and hear their employees all day long. Can't get that
from any book.

------
JohnN
I had side projects and consulting opportunities on the go but I shelved them
all to concentrate 100% on my startup. Luckily, I live at home so I dont have
the pressures of some people but I think outside "consulting" is not
sustainable in the long run.

I have noticed since I have been 100% on my startup I have not only worked
harder, Ive worked smarter. Save up from consulting and hit the startup....

Full Time

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Xichekolas
My question is this: where do you find your consulting gigs? Do they come to
you entirely word of mouth, or do you actively pursue postings online and in
papers and such?

~~~
tocomment
I was going to ask this same question. I'd love to do consulting but I don't
know anyone. What do I do exactly to find gigs?

~~~
DanielBMarkham
I started by working through the temp services. Usually they have some
general-purpose programming gigs. Once I got a few projects under my belt (and
did some freelance programming work in the area) I went online and started
spamming all the resume sites. Then the gigs come to you. Ideally you want to
move into a word-of-mouth situation, but sometimes it takes a bit to work up
to that.

~~~
tocomment
What kind of resume sites? Like monster.com, or special ones for freelancing?

~~~
Tichy
Special ones for freelancing. I had good results with Jobserve, but I am not
sure how popular they are in the US? I did not upload my resume on Jobserve,
only contacted a few agents who were searching. They took me on file and that
was it. I uploaded my CV on Gulp.de, and got one contract from there, but it
took a while.

------
SwellJoe
I always did IT consulting, when I needed some spare cash.

Serious Linux nerds are in high demand and low availability almost everywhere
I've ever lived. But, if you're not well-equipped for IT, that might not be
the way to go. Tech support is also the highest stress technical career (there
was a study about it a couple of years ago, and if I weren't lazy I'd look it
up), so you don't want to do it for long if you haven't the patience of Job.
But billing $100/hour is not at all difficult, so you only have to work three
or four days a month to scrape by...don't underestimate the time spent on
paperwork and such, though...some companies make you work an extra day for
every couple of days you work, in dealing with expense forms and other
assorted crap. I much preferred working for small companies, where one person
made the decisions and when he or she said to the accountant, "Write Joe a
check", it would be in my hand before I walked out the door.

But, IT has the advantage that you're generally working on small jobs--things
that can be fixed in a few days, or a couple of weeks, tops. They are well-
defined, like, "We need to move our web servers to a new data center", or "our
mail server isn't filtering spam and it's letting viruses through". You know
when you're done with this kind of project, generally.

That said, startups are kinda like a marriage. Having a little something on
the side isn't likely to turn out good for the startup. Have you considered
raising a little money to get you to launch and revenues?

~~~
Elfan
Could you elaborate on what you mean by "serious Linux nerds" in this case? Do
you mean someone who uses Linux every day or a system administrator in a
former life?

~~~
SwellJoe
There is no "system administrator" college degree...so you pretty much get to
decide when you're equipped to be an IT consultant, and what your time is
worth. Of course, repeat business is the only way you'll make decent money, so
you'd not want to exaggerate your accomplishments. But, "serious Linux nerds"
means people who are capable of setting up mail, DNS, web, users,
LDAP/NIS/Samba, NFS/CIFS, and hooking it all up in such a way that it can
operate without you present (I always used Webmin for this aspect--it has
great ACLs so you can give as much or as little privilege as your customer
needs to be able to create/manage users without breaking anything, for
example).

Even if you're not an expert at all of these things, if you know what they're
for and can read the documentation and make all of them work in an afternoon,
then you're well-equipped (better equipped than many Microsoft "certified"
techs) for the job. Most small businesses don't even know what they need, much
less how to set it all up. So, when you go in, you'll find that they have no
idea what you're doing, why you're doing it, or how it all fits together. How
you explain it is more important than how you implement it when it comes to
whether you're called back or recommended to other businesses. It has to work,
of course, but as long as you're explaining the job clearly and in simple
terms, the customer will remain happy (try to look busy, as well...sometimes
you'll be waiting for installs and such...do something else during that time,
even if it's busy work).

Note that I'm not necessarily recommending this path. IT support sucks. It's a
very stressful field, where the only time you hear from people is when there's
a problem. In fact, the only time you hear from people is when there is a
problem so severe that they can't get work done (people are so afraid of
computers, and of thinking about technology, that they'll ignore trouble signs
until the breakage is complete). Thus, your customers are almost always
stressed out. I frequently worked for a company that had a quarter million in
daily revenues, and so a day with all of their people off-line cost them
significant sums of money. I have great respect for the fellow who built and
owned the place, as he kept his cool like a champ, no matter how tight the
downtime schedules were...but some of his employees (and share holders) did
not.

Oh, yeah, you'll also work a lot of nights and weekends, because that's when
companies can afford to be completely off-line.

------
edawerd
I was actually considering looking for a front desk job in a SF condo. The guy
in my building has a desk with a comfy chair and just sits at the front desk
every day from 9 to 5 and surfs the net with his laptop, and occasionally
accepts packages from time to time. Thats time that I could be hacking! I know
from the HOA that I pay that he's paid quite decently. So what more can you
ask for? A cushy, decently paying job in SF with a desk, chair, and internet.
Perfect for hacking.

~~~
erik
I've considered the similar approach of getting a job as a late night security
guard on an industrial site. I've heard of the unending hours of doing
nothing, and I think of the hacking potential.

I wonder if anyone has ever created anything notable while working that sort
of job.

------
ardit33
There is always Starbucks.... Work 30hrs/week so you get health insurance and
other benefits. The job will be like some brainless activity that programmers
really need time to time.

Bonus: You get to meet/interface with lots of people, and maybe you can score
some hot chicks on the side.

Sucks: Pay. 8/hr or 10/hr is not really much, but I guess enough to buy lots
of ramen noodles for a starving programmer.

~~~
Tichy
I would actually be interested in working in a cafe for a while, just for the
social experience. But I just can't justify it economically. Except perhaps
when thinking it gives me a minimum income for peace of mind. Then again,
consulting for the same amount of time would buy much more time.

------
dpapathanasiou
Have you tried getting paid ads on your sites, especially the porny (er,
"erotic") one?

~~~
dpapathanasiou
I'm not being facetious: one of the O.P.'s web sites is "<http://3boobs.de/>"
or, as he himself defines it "erotic games".

Porn-ish sites like that _do_ attract advertisers.

~~~
Tichy
Traffic attracts advertisers, porn-ish alone doesn't do anything. Or why would
advertisers be interested?

~~~
dpapathanasiou
It seems that the affiliate ad model for "dating" sites pays well:
[http://money.cnn.com/magazines/business2/business2_archive/2...](http://money.cnn.com/magazines/business2/business2_archive/2007/04/01/8403370/index.htm)
(note the paragraph which starts "To expand without investment capital...").

It's also interesting to see that when AdBrite loses an adult advertising
partnership, it's an important loss for them:
[http://valleywag.com/tech/online-advertising/philip-
kaplans-...](http://valleywag.com/tech/online-advertising/philip-kaplans-
adbrite-loses-porn+ad-network-290865.php)

AdBrite is private, though, so we don't know what percentage of adult ads
account for revenues, but they do have an entire other site --
BlackLabelAds.com - dedicated to adult ads.

Anyway, it was just an obvious suggestion, given the 3boobs site you'd already
created.

Best of luck to you, whatever you do.

------
fleaflicker
don't--you can't do a startup on the side, it won't work.

you have a finite amount of (creative) energy. it's all or nothing.

~~~
yubrew
Full-time effort >> part-time effort. However, there are cases where part time
is good enough.

It varies on how much (smart and well funded) competition there is, barriers
to entry, your own personal ambitions. In general, larger and stupider the
competition, the more likely you can do ok with part-time effort.

Joel's post on being a Ben and Jerry's vs. an Amazon can give some insight on
this topic: <http://www.joelonsoftware.com/articles/fog0000000056.html>

~~~
edw519
Part-time effort always > no effort

------
falsestprophet
I think that you can leverage your position into the fetish market. Buy a
camera. Bootstrapping sells.

check out Paul's early work at pg13bootstrapping.com [nsfw] [login required].

------
joshtempte
14th and Broad St. $20 for a handjob.

~~~
ardit33
Lol....

