Blog of Rob Galanakis (@robgalanakis)

“Professional services” for pre-revenue startups

Something I’m beginning to explore is what a services business providing programming and long-term technical guidance and mentorships for startups would look like. A business that takes the things I know I am good at — mentorship, programming, product management — and provide it to companies who need it in a way that leaves them set to grow and scale.

How would this work?

My ideal setup would be to find a founder/cofounder who is a relatively inexperienced software engineer, and help them get their business off on the right foot. Showing them how to set up a sustainable platform for future development and prioritize so they can avoid hiring a big team with diminishing returns.

This may also mean connecting founders needing “technical cofounders” to candidates, with this business supporting both the business and potential cofounder to make sure they’re a fit and the business transitions.

A more straightforward setup would be just building what needs to be built (in which case the payment model gets more interesting), with ongoing support and development as needed. I think this could be a great fit for folks that plan to more slowly grow their business and don’t really need to bring development in-house, or pay 3rd party contractors.

I could see in the future, once this business has a staff, that they could potentially transition into actual cofounders of the businesses they are partnering with and leave the service.

One other thing I’m planning is to create a couple of open source codebases patterned on what I built for MilkRun (based on what we built at Cozy) to stamp out new projects. I’m really happy with both the patterns and development experience at this point — I considered using something like Rails but I just don’t enjoy programming in it. It’s basically impossible to evaluate the quality of programmers’ work until you see it, so my hope is that this codebase will give founders some good confidence in what they’re getting.

What is the structure or scope of an engagement?

The structure of all of these would, to start, be a set number of hours/week. I’d be starting this as a side business, for myself and potentially others who would be able to take on long-term side commitments (which is easier said than done). I’d expect hands-on engagements to be maybe six months, with potentially a longer-term advisory role.

How does payment work?

Here’s where it gets more interesting. My plan is to do something more akin to IndieVC’s funding model:

Rather than paying cash up front, there are a number of potential options:

  • Revenue share up to a certain amount of money
  • Revenue share for a fixed amount of time
  • Equity
  • Equity that can be repurchased
  • Payment-in-kind (exchange for goods or services)
  • Combination of any of these

I’ll probably start with the legally easier options, but hope to be very flexible with payment options to find what fits a business properly. Obviously not all of these are applicable to all businesses. The goal is to have options outside of the traditional work-for-hire model.

Is this viable?

I don’t know! I can say that early on it is doable, since there are no costs or need for revenue :) The way I see this unfolding long term is:

  • This is a side job for the next 2 or so years. I work with a couple of startups at a time.
  • I seek other people like myself who are willing and able to take on this business model as a side job.
  • Those startups either succeed and convert into revenue, or fail and have positive experiences with me they take forward.
  • Eventually that “positive experience network” allows me to take on “normal” consulting work. One nice thing is the ability to subcontract work out to founders I’ve worked with who need the income. It will also at some point mean bringing on staff.
  • The successful startups create passive income that acts as a cushion and buffer for other activities.
  • Once we hit a critical mass of passive income and paid consulting, I’d switch to full time.

Isn’t this just regular work-for-hire contracting?

Well, sort of. Taken individually, each aspect is not particularly interesting. But the point of it is putting them all together in a relatively novel way to see what happens.

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