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A Smart Bear · Jason Cohen
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About A Smart BearHiring even one person creates a lot less profit than you'd think, and launching a product rarely works out. Here are some tips for consulting companies.
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Treat hiring and product development as separate economic bets, not automatic paths to scaling a consulting firm. Model the true profit added by each hire, and validate product demand before funding a transition with scarce cash and attention.
A larger team can increase revenue without materially improving profit, while an unvalidated product can consume consulting profits without becoming a dependable business. Clear thresholds help founders avoid growth that adds complexity but little durable value.
Before your next hire or product investment, calculate: What utilization, pricing, delivery costs and product demand must be achieved for this bet to produce an acceptable return—and what evidence supports those assumptions?
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