Should You Hire a Business Startup Consultant?
Over the last few years, bootstrapping companies have become increasingly popular – running a tight ship, keeping expenses in check, and prioritizing profits over rampant growth are slowly becoming accepted as the norm. As a result, companies are tightening their purse strings and hiring less aggressively, so we’ve seen the rise of a more compact brand of the workforce – the startup consultant.
Startup consultants can be a fantastic boom for companies to crush a plateau or revitalize some business units, but they can also be an unneeded expense that a small company can’t spare. This article aims to clarify which of these answers is for your particular case.
What is a Startup Consultant?
Before analyzing the merits of a startup consultant, it’s important to define what it actually is. There are a lot of blurred lines when it comes to what a startup consultant actually does, and they often cross a strange Venn diagram between contractors, business coaches, and business consultants.
Business consultants have been around for decades. Companies like Bane and McKinsey get paid hundreds of millions of dollars by massive corporations to bring specialized resources to solve and optimize unique problems. In the startup world, business consultants have long been a taboo – a relic of an old corporate era.
Freelancers and business coaches have had a more omnipresent home in the tech world, particularly on the engineering side. Flex companies like Toptal has provided capable resources to many companies who want to get moving quickly and avoid the strain of hiring. mata actually helps ease that strain by providing a platform where you can book on-demand services that best fit the company.
Startup consultants are a hybrid of these 2 ideas. For starters, they’re laser-focused on technology startups. They understand things like hypergrowth and lean product development, and they usually specialize in specific holistic areas. For example, scaling infrastructure needs, moving upmarket, optimizing success workflows, etc.
Unlike a business coach or a freelancer, a startup consultant has a general area of expertise that they’re brought in to address with a clear deliverable – and oftentimes, their workstream will involve bringing on board freelancers to complete the necessary tasks. With effective collaboration, a startup consultant can help streamline entrepreneurship.
So, how does one know if they actually need a startup consultant? There are a few questions that should be answered:
Do You Have a Clear Problem Definition?
The worst scenario to hire a startup consultant is when something is going “wrong” but you have no idea what it is. This is especially common at startups where there’s usually a hundred different things going on.
For example, your company might have growth numbers plateauing for several months at a time. Before hiring a startup consultant who focuses on growth, you need to personally understand why that growth is plateauing. It could be any number of things – product latency, market saturation, lack of product messaging, product issues, lack of corporate governance, minimal funding, shortage of investors, etc.
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When you bring in a business startup consultant to figure out what’s causing the problem and then solve it, you’ll end up paying ridiculous amounts of money for what might amount to a simple fix.
Instead, take the time to get a clear understanding of what’s causing your problem, and then explore services in fixing or optimizing that specific issue. When you use a tool like mata, on-demand capabilities and collaboration tools are at your disposal, backed by an expert team just for startups. Before you hire a startup consultant, use mata to find an on-demand service for your specific needs.
Do You Have a Precise Budget?
A good startup consultant will solve your problem – whatever it is. The issue is whether your company actually comes out in the green after solving that problem. If a consultant comes in and fixes your advertising strategy at the expense of all of your saved marketing dollars, it wasn’t really worth it, was it?
It’s essential to have a very clear budget in mind. Put a dollar figure value on the problem you’re looking to solve, and then go out and see if there are talented people who will solve it for that figure. Managing the budget efficiently helps you maintain investors and keep funding secure.
This is doubly important in cases of vaguer budgetary constraints. For example, if you’re refactoring something in your engineering/infrastructure, take the time to analyze the business implications of whatever you’re hoping to fix, and do whatever you can to put a dollar figure on that improvement – both in the short and long term.
A startup consultant will obviously try and maximize their profits from an engagement, so it’s up to you to walk into negotiations with a clear, untenable figure in mind. You know the problem, you know how much it’s worth to you, so find someone who’ll solve it for that amount. Since mata incurs no extra fees, you can find the right on-demand service at minimal fixed costs with always reliable deliverables.
Do You Have a Very Precise Workstream?
Here’s the biggest no-no in hiring a startup consultant: outsourcing an entire business unit (i.e marketing) to a consultant. An efficient workstream is especially important for startups.
If you don’t already have a team for a particular element, you’re probably not at the right stage for a consultant anyway – and if you do have a team, a consultant should embed into that team. For example, if you don’t already have a marketing team, you don’t need to hire a startup consultant. Rather, if it’s a growth challenge you’re dealing with, consider hiring your first dedicated marketer.
If you already have a generalized marketer, consider scoping your consulting engagement to a narrow band of marketing deliverable. For instance, consider a shorter-term engagement by purchasing an on-demand service package on mata, specialized in content strategy & branding, and has them work with your generalized marketer to realize it.
The day-to-day context of your organization is essential to be effective, and a startup consultant simply can’t take on the responsibilities of an entire element. Instead, having them embed on a specific team and absorb their context while bringing in their outside expertise is a much better approach.
Takeaway
Startup consultants can be the difference between a business chugging along and a well-oiled machine crushing KPIs on a monthly basis. How you apply it is crucial and depends on first taking a very close look at your business, understanding the problems, and concocting a plan to solve it. Whether you’re a startup consultant, freelance worker, or a start-up founder looking to take action on a new idea, grow your company, or maintain your corporate governance, you can rely on mata by Saffron to guide you through the entire process.
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