The Independent Consultant World is Small (And why that matters!)

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Hi there!

A few weeks ago, a good friend texted me. He’s also a solo consultant.

“I’m flying out to (REDACTED) tomorrow. I’ve got a lead for a huge project, and I’m going in person to close them.”

That’s always been his closing move. He always flies to clients the day after meeting them.

(He’s the only person I know who does this, but it works great for him).

We naturally started texting more about the project. It was at this point his story about the client began to sound familiar.

The prospective client claims to have worked at Goldman Sachs. He then got access to capital and bought a pretty unique business in the US.

He’s also a conman. We’ll call him Joe

Joe has run this exact playbook three times now (that I’m aware of):

1. Joe finds a consultant and offers them a multi-hundred-thousand dollar contract

2. Two days later, Joe claims his “Board of Directors” yellow-flagged the consulting project.

3. To get the project approved by his board, Joe needs the consultant to do all the strategy work upfront. Then, Joe can hire the consultant to implement the strategy.

4. So, the consultant builds the strategy and gives the client the playbook

5. Joe then ghosts and blocks the consultant.

I promptly told my friend about Joe’s history.

Needless to say, my friend did NOT fly out the next day to meet Joe. (PSA: if you are contacted by someone you think might be Joe, please feel free to reach out to me first. I can share Joe’s real name and we can hopefully help you avoid this situation.)

However, there are a couple of things we can learn from Joe. That’s what today’s newsletter is about.

Learning: The solo consulting world is small

Consulting is a $330B market.

Yet, almost all of that goes to the big consulting firms: McKinsey, BCG, etc. The established solo consulting market is a lot smaller.

It’s small enough that you’re never more than 1-2 degrees from anyone else. You likely catch up with solo consulting friends frequently. You likely know of other solo consultants who are doing well

You’ll also know of situations like Joe.

(For those new to consulting: don’t fret! You will get to meet other solos pretty quickly!)

Implication #1: Bad Actors (Clients & consultants) are found out quickly

The first implication is probably obvious: there are consequences to being a bad actor.

Joe won’t be able to hire another consultant unless he either:

A: Pays upfront (unlikely)

B: Hires someone unaware of his reputation (and is therefore likely a new consultant and a riskier hire to make)

That’s a problem for Joe. If he’s in a situation where he really needs a consultant, then he might be stuck.

Here’s the interesting thing: the danger of being a bad actor also extends to consultants.

Many solo consultants refer work out to other solo consultants in exchange for a cut of the sale. (I personally don’t do this; I refer for free).

However, there are stories of solo consultants who received referrals and then refused to pay.

Those consultants also get found out quickly. They also struggle in the long run.

Implication #2: Gate Keeper risk is real

Genuine bad actors are identified and labeled as bad actors.

What about good actors who are mistakenly labeled as bad actors?

One individual within the independent consulting world functions as a bit of a “gatekeeper.”

I do not think he is a good person. Most tend to agree.

However, he does have an interesting role in the independent market. He's in a position where he can label someone as “good” or “bad.”

He has mistakenly labeled genuinely good people as “bad” before. It’s difficult to break out of that reality when the world is so small.

Hence, gatekeeper risk.

Ultimate Takeaway: Reputation is Paramount in this industry

You’ve likely heard it before: reputation is everything.

The small size of the independent consulting world means your reputation is amplified.

If you do something to wrong another, clients and consultants are going to hear about it. It will be difficult to recover from it.

It goes the other way too: if you’re someone who goes out of the way to help others, then the good will comes back to you in this small community. It’s part of why I don’t chare referral fees when I refer work out.

How can I help?

If you reply to this email, it will come directly to me & I’ll respond as quickly as possible.

To head off a very common question: I’m sorry but I don’t have any quickstart guides, courses, communities, or other paid resources!

What would be most helpful to read about next week?

Let me know what would be most helpful for you :)