Building a Consulting Firm: Lessons Learned Five Years On

It's quite a cliché, but I agree that the most profound learning often comes not from your successes but from challenges you had to overcome.

Before last year, my entrepreneur’s journey has been a rather smooth ride. In 2023 things changed a bit. Not really because of any troubles when it comes to our revenue but rather due to strongly increased costs.

This was the point at which I had to made some difficult decisions on who to keep on my team and which internal initiatives to pursue further – and which not.

While these times seemed rather unpleasant when I was living through them, they led to some crucial learnings that have made me feel like a more mature leader and entrepreneur.

Thankfully, we could really reap the fruits of these learnings over the last months which were the most profitable in our company history.

So today, on our 5th anniversary (time really flies…) I would like to continue my tradition of sharing some of my key learnings with you as I dida few years ago:

Build your brand – early on

When you are starting out as a freelancer, many people will tell you that you shouldn’t build a website but rather focus on getting your first projects in.

I disagree actually. You should do both. You don’t need to build a„perfect“ website (if such a thing exists at all), but you should build a simple website (today, this is really easy to do thanks to Jimdo, Wix and thelike) to build a more professional brand for prospective customers. As a nice side effect, this forces you to think about your actual offering and target customers in more detail. Both can’t hurt to generate some initial sales – which should of course be your priority as well.

We‘ve over-invested quite a lot in our brand with building a website early on and being quite active on LinkedIn and later via our newsletter (sign up here if you would like to get a monthly dose of insights onbuilding better organisations). Based on the feedback we receive on this and the fact that we never struggled to get enough inbound leads, I would say this has paid off.

It’s completely normal to then finetune your brand as you go along. It actually took us a few years to define a clear mission and vision that now really guides our strategy and actions.

Create systems that allow you to scale your work and team

Similarly, our team members often told me that our internal processes and systems were more mature (in a positive sense) than our small size would suggest.

This is mainly due to the fact that it’s no coincidence that one of our core consulting areas is „productivity“. It’s part of my personal strengths and thus of our DNA as a firm to build things the right way, leveraging tools and actually practicing what we preach. Our most important tools are asana for project management, slack for team communication and Google Workspace/ MS365 for creating and managing client documents but we also use more than 20 other tools (not joking…) in one way or another.

We’ve used OKRs from day one to set ourselves clear goals, prioritise our efforts and motivate the team along the way.

A continuing challenge (as probably for most consulting firms) is how to optimise our knowledge management. Finding the right document (be it from former client projects or external studies that we filed in our R&D system) can often be difficult. We hope that the advances in AI - which we are testing continuously - will help us to leverage our existing knowledge base more easily in the future.

Really understand what it takes to be successful in your company

The key question I am asking myself since our founding is: „do I want to grow our team further?“
I started out in 2019 as a normal freelancer and usually worked with 1-2 team members since hiring our first working student in 2020. The growth was driven by a) client demand, as the number of interesting projects surpassed my personal capacities and b) my passion for building a „real“ company and offering others a job they love (see our kununu reviews for some feedback from the team).

But I was always and am still hesitant to grow our team further. Partly because I value freedom and „alone-time“ as an individual and my feeling is that growing could be detrimental to both. Partly because I’ve seen last year how much financial and psychological stress can result from things not working out as planned.

In consulting, every consultant needs to their own little "mini-firm" in a sense: they need to make sure to build their own personal brand, ideally do some sales and of course make our clients happy with their project work. This already places quite high demands on a person. In our specific case, we also conduct our work in a quite unique way – strongly shaped by my own working style and values.

One key take-away from the last years is: I absolutely have to make sure that all respective team members truly would like to and can fulfill the requirements of a consultant role and do so in a financially sustainable way. Therefore I was super transparent and clear about this when starting the collaboration with our most recent consultant addition to the team. There are clear targets for individal project income and building your personal brand is as much part of the job as the client work.

The success of the last months showed: such a system can work really well for all sides involved. Now we actually feel back on track again on our path to building a boutique consulting firm.

Experiment, but know when it’s time to stop

One reason for this new clarity is our decision to double-down on offering the best consulting services we can and to stop investing substantial resources into building more scalable digital products.

Over the last years, we‘ve launched a range of Toolkits, some free like the OKR Toolkit or the Offsite Location Guide, others paid such as the HR Checklist and the Feedback Essentials Toolkit.

We’ve put a lot of passion, money and time into these products and are still conviced about their immense value for our clients. However, we’ve had to realise that from a rational, financial point of view, it does not make any sense for us to invest much more into creating any new products and we should really rather focus our energies on our more profitable consulting business.

This was a tough one for us. But making this call also felt right and liberating in a way. In the future, it is quite likely that we will rather build some smaller Toolkits as "teasers" and to add value for our community, but less with a profitability focus.

👉 If you haven’t yet checked out our existing digital products, now would be a great time as we offer a 50% discount with the code 5YEARSJRC only until 30 April 2024.

Above all: create real value

In the end, what makes us succesful is only the satisfaction and trust of our clients. We are very grateful for each organisation which decided to work with us – many of them repeatedly.

In comparison to similar players on the market we are marked by a mix of real analytical thinking, empathy and a pragmatic can-do attitude.

What sets us apart is not only what we do (we have quite a breadth in our offerings) but how we do it. Our values along with our experience are the foundations for everything we do and I believe our clients notice this.They know they can trust us. They know that we act in their best interest.

This always was what is driving me to work hard every day and this is what still lets me say after 5 years: „This is my dream job.“

We can’t wait to build better organisations together with you!