Your questions for Matt Weinberg

Bootstrapped Podcast
#1

If schedules work out, we’ll have Matt Weinberg as a guest on the show next week.

Matt is the co-founder of Vector Media Group, a web design/development agency he started when he was just a teenager (many years back), and bootstrapped to a successful company of 30+ full-time employees. Vector consistently appears on the Inc. list of fastest growing companies.

I’m excited to get the chance to ask Matt some questions, particularly on the topic of growing a consultancy from a one-person freelancer shop to a larger agency.

If anyone has any questions for Matt, or would like us to explore certain topics during our conversation, please leave a comment on this thread before Tuesday, July 12th.

Thanks!

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#2

As someone who runs a very small consultancy (myself the only developer with some sub-contracting services), I have a bunch of questions.

  • Hiring - In the early days, how much salary buffer did you aim for with your first few hires?
  • Revenue Sources - For us a significant (but far from a majority) amount of revenue is recurring “support” revenue for custom software we built that provide ongoing value to customers and need to be supported (business critical, 24/7 operation, things like that). Is this a big source of revenue for your consultancy or is it mostly coming from consistently completing and closing out projects? Can you tell us a rough split?
  • Utilization - What utilization do you aim for with employees? That is, what percentage of time for non-overhead positions do you aim to work on billed projects? Put it another way, are you generally billing out 2080 hours/year for every salaried non-overhead employee? How has this changed over time?
  • Project Size - billed hour / cost wise, how large are your projects and how has that size changed over time? For example, we build a lot of 100-200 hour projects. I generally avoid anything less than 40 hours of effort, unless I see a lot of opportunity with the client down the road.
  • Billing - Do you bill by the hour? By the week? How has this changed for you over time?
  • Contract structure - Do you generally write large contracts representing entire projects, and bill in lump sums (milestones, goals, whatever), or do you aim to establish a more loose Time&Materials type arrangement?
  • Emotion - Was there a point where running a consultancy stopped feeling like filling up a leaky bucket? If so, when did that happen for you and what changed?

That’s a lot of questions, but they are all interesting to me, and many of them may be valuable to others.

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#3

How does Matt deal with the stress of having this many employees?

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#4

Lead generation: - how did you generate new projects/leads while you were still a small agency ie. 1-3 people, and is the approach different now with 30+ employees?

#5

Was there a tipping point moment from handling small jobs (< 50k) to getting bigger jobs (100k +) or has it been a case of scaling up on handling the smaller jobs.

From experience my consultancy (no longer a shareholder) attracted much bigger jobs once we’d got that first 100k+ contract.

If there was a tipping point what was it and how didi it come about?

#6

Thanks guys! I think we got to all of your questions during the conversation. The episode should be up soon.