

Ask YC: Do consulting companies get funded? Why or why not? - lawnchair_larry

I suspect the answer is no, and I can think of some obvious disadvantages, but I would like to gain some perspective on this. Also, hybrid companies that are working on product, but aim to be somewhat self-funded by consulting at the same time.<p>(This doesn't have to be specifically for YC - anyone involved in angel or VC funding is welcome to share their perspective.)
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ig1
Generally no, to get investment you need to be able to offer a 10x return in a
short time frame (3-5 years). Very few consultancy firms can offer that
because it's hard to rapidly scale businesses where growth is restricted by
number of employees. Scaling a people based business is hard (both because
hiring is hard and also you can't stop people leaving to compete with you).

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petervandijck
No, unless you've found a way to make consulting companies scale.

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wavephorm
You can see a list of companies YC has funded at <http://yclist.com>

There's an awful lot of consumer facing web "product" companies (most of them
clones like "Twitter for Teachers") and very few, if any all-purpose
software/consulting companies. My only guess is they prefer companies that can
be condensed into a laser-focused story in the form of a well-oiled slide-deck
and elevator pitch for the YC Demo Day.

Meanwhile, software/consulting companies like Fog Creek or 37 Signals can do
very well for themselves.

