February 16, 2017
“I’m actually winning projects at 10x the hourly rate I used to make”
One of the folks in my coaching Slack room shared a huge success story with me recently. I think you’ll find it inspirational.
NOTE: Shared with permission. Lightly edited for clarity. Stephen Colbert is not his real name 😀
Yours,
—J
Stephen Colbert:
Random update for you: So, I’ve been taking your advice and stopped doing hourly work as of late. And somehow, I’m actually winning projects at 10x the hourly rate I used to make. This has allowed me to bank 6 months salary in the past quarter, pitch and win much larger jobs, and am now going back to the client with 1-week $55k projects that they feel are “obvious no brainers”, and they are thanking me for bringing them to their attention!
Thank you for all you do, and please keep it up!
Jonathan Stark:
Excellent! So glad to hear it! What are the 1 week projects?
Stephen Colbert:
In this case it’s dev work. High-value “add-ons” that take less my team less than 1 week to produce.
Maybe that doesn’t apply?
Jonathan Stark:
it does. i’m just trying to get a visual :)
Stephen Colbert:
Ok, cool. I just noticed that the more I charged, the easier it was to deliver, the more they trusted me (because I delivered) and the more they listened to my suggestions. The only way that worked is when I stopped hourly billing.
Jonathan Stark:
yep
Stephen Colbert:
On a one-week project I would have charged them 5k or less a year ago.
So, I guess an 11x increase is nice. ;-)
Jonathan Stark:
hahaha
uh, yeah
Stephen Colbert:
And somehow I managed to switch them from hourly to value pricing, and they thanked me. I thought that would be an impossible transition.
Jonathan Stark:
no pushback like, “$55k?! But it only took you a week!”
Stephen Colbert:
No, in fact I sell time-to-market as part of the value.
Jonathan Stark:
perfect
Stephen Colbert:
“You can have it to show your boss in a week!”
And at big companies, NOTHING happens in just a week.
Jonathan Stark:
so true
do you recall how you converted them off of hourly?
Stephen Colbert:
Yeah. They wanted a second phase to the project, and I called up my contact and said, “I’m going to structure this proposal differently, in such a way that you’ll be better served and get quicker delivery.” I was that vague.
Then, the next proposal didn’t say anything about hours or hourly rates.
Not even a “Work outside this will be done at $200/hr” type of clause like I used to have as my “safety net”
Just “We will do X, by Y date, for $Z”
(X was more detailed and goals oriented, of course!)
Jonathan Stark:
right on!
Thanks for reading! See you tomorrow.
Yours,
—J