Building an Open Source Consulting Company

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Lessons learned from a successful open source consulting company. This talk is geared towards the open source developer who is considering starting his/her own business, and the entrepreneur who wants to grow the business by leveraging open source development methodologies.

Building an Open Source Consulting Company

  1. 1. Building an open source consulting company Nate Aune www.jazkarta.com Open Source Bridge Conference Portland, OR June 17, 2009 1
  2. 2. /me • First experience with Linux in 1994 • Founded Jazkarta in 2004 in Boston • Now 3 full-time staff and 10 subcontractors • Specialize in Plone and Python 2
  3. 3. Topics for exploration • Marketing • Recruiting • Pricing • Finances • Contracts • Open Source citizen • Project Management • your topics? • Services 3
  4. 4. Marketing 4
  5. 5. Marketing & getting work • Speaking • Blogging • Sponsoring • User group / consultants group • Networking 5
  6. 6. Pricing 6
  7. 7. Pricing / rates • How much do you want to make? • What are your costs? • What will the market bear? 7
  8. 8. $100,000 / yr $100,000/yr % 50 wks/yr % 20 hrs/wk = $100/hr 8
  9. 9. Costs of doing business (overhead) • Self-employment tax • Legal fees • Accounting / bookkeeping • Office space • Hardware • Subcontractors • Telephone 9
  10. 10. Market rates • What are your competitors charging? • How much will your customers pay? • How does the economy affect your bill rate? 10
  11. 11. When to raise rates? • When your customers don't blink an eye when you tell them your rate • When you have more work than you can handle • When you have an in-demand skill 11
  12. 12. Contracts 12
  13. 13. Contracts • Get legal advice - don't do it by yourself • Optional scope contracts • Tools: EchoSign for digital signatures 13
  14. 14. Traditional vs. Timeboxed Optional scope contracts: 14
  15. 15. Project management 15
  16. 16. Project management • Agile is aligned with open source development • 2 week iterations • 3 person teams (PM, dev, design) • Tools: ClueMapper, Google Docs, Dropbox 16
  17. 17. Resource planning 17
  18. 18. Global Team 18
  19. 19. Global team strategies • Group team members in same or close timezones • Make sure everyone is on IRC and uses it • Set up a mailing list for each new project • Skype calls every week to touch base • Issue tracker (ClueMapper/Trac) • Version control (Subversion/Bazaar) 19
  20. 20. Pros/cons of subcontractors • Pros • Only pay them when you have work • Can find top talent, specialists • Cons • More expensive • Can be difficult to retain if not enough work 20
  21. 21. Services 21
  22. 22. Services • Development • Training • Support Recurring revenue • Hosting 22
  23. 23. Training • Private onsite training • Public training • Training as part of a conference • Online training 23
  24. 24. Support • Open source = no guarantees • Retainer = insurance policy • Keeps the conversation going • Upsell support before the project is complete 24
  25. 25. Hosting • Easier to support if on servers you control • Distribute benefits across all customers • Upselling opportunities • Steady source of recurring revenue 25
  26. 26. Recruiting 26
  27. 27. Recruiting • Read blogs • Attend sprints • Elastic staff • User groups • Internships 27
  28. 28. Finances 28
  29. 29. Finances • Get a good bookkeeper • Seek next project while still on first project • Find sponsors to fund open source dev • Tools: Quickbooks 29
  30. 30. Open source citizen 30
  31. 31. Open source citizen • writing documentation • contributing code • serving on board • sponsoring sprints • organizing user group 31
  32. 32. Thanks! Questions? 32
  33. 33. Stay in touch • Email: natea (at) jazkarta (dot) com • Twitter: twitter.com/natea • Blog: blog.jazkarta.com • IRC: irc.freenode.net/natea 33
  34. 34. Books & Resources • e-Myth Revisited by Michael Gerber • Manage It! by Johanna Rothman • Ship It! by Richardson/Gwaltney • Art of Agile Development by Shore & Walden • Making Things Happen by Scott Berkun • Computer Consultant's Guide by Janet Ruhl 34

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