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Am I being played for a sucka?
I have this client, we met over LinkedIn last October, and my business guy (as a nerd, I am not that business savvy) advised me. They paid for a $1000 letter of intent for a task, which we did and they loved, and then a $1500 letter of intent and we performed the work, and now they are working on writing a grant proposal and my business guy, who I respect because he is a former U.S. Marine, 20+ years experience, used to work on the top floors of the TransAmerica Pyramid etc etc., and I've been friends with him for nine years, has been insisting we do pro bono advisory for them on their grant proposal to "build relationship" and he tells me "there will be oh so much money rolling in if they win it."
Me, I am not so sure. As a physicist, I view the future as a complete uncertainty, except for probabilities. There is no 100% guarantee they will win the grant, and as such, I feel it is important to, as a profit-making enterprise, charge money for their use of my Ph.D. education to advise them (it's a grant from the government to work on spacecraft).
So we've been doing this for a couple of months now, and my business guy has not been charging me (he's a contractor to my little LLC) and so of course I've not been charging my client, but just last Friday, the CEO gets on the line for our tag up and brags to me about his new office he's opened up in Titusville, FL. And a further while back I heard from their CTO that they are constrained on budget but before that call, the CEO calls me up and tells me that he just won a $300,000 funding round. I also saw a LinkedIn post about how they just opened up a new mfg facility and the CTO had told me about how they have $92M in pre sales. They are even engaging with a vendor who, I presume, they are paying to help them write the grant. So where is the piece of the action for my company?
My business guy says, "Provide them free services for now to 'build relationship' and 'make them like you' in hopes they will pay later. My thinking is, "They are going to get an inch and then take a mile."
Call me naive, but as a PhD astrophysicist who worshipped Mr. Spock growing up, I am confused. I idolized Mr. Spock because, in my mind, he thought (mostly) that all humans were idiots and emotions were stupid (which I agreed with at 12 years old and my life since then has more or less confirmed). I also thought a bit about logic and thought, Mr. Spock knows what he is talking about. "If p, then q." Makes perfect sense to just think about the universe in terms of logic propositions. So then I get older and I actually do get some therapy and learn more about the emotional spectrum from Green Lantern and realize that human emotions aren't completely stupid, but I still basically have a Kindergarden level understanding of them.
This is where i come from into the business world. Either things make sense, or they do not. Correct me if I am wrong, but if I go into the convenience store, grab a soda out of the fridge, and then walk out the door without paying for it, that's stealing. I doubt the store proprietor is going to give it to me for free to "build relationship with me in hopes that I return someday as a paying customer." No, it's theft, straight up.
So why in the technology consulting world is it even slightly reasonable to give away the experience, knowledge, expertise, and thought leadership I've spent many a grueling year building up and putting up with a lot of crap for, for free? That seems highly illogical, Captain -- as Mr. Spock would say. Yet, my business guy says give them a little bit for free so that they pay later hopefully.
Is my business guy's advice logical? Am I being played by my client? Am I a sap who is just so focused on hugging teddy bears and wanting to make the world a better place that I am being taken advantage of? This weekend, learning about the office pushed me over the edge. So I told my business guy he isn't making any sense, I told the CEO and CTO that our pro bono services will continue until 12:01 AM on Saturday June 8, and then they need to pay for everything -- every task, every deliverable, and every meeting beyond that.
Here I am, waiting for kookaburra over here, and I am all like, "I am a total sucker." Am I correct, to insist on valuable monetary compensation from my client or does my business guy have a point?
Okay....go!
modified yesterday.
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100 years ago your guy might've had a point. Not sure.
But now? Forget it. If you aren't getting paid you're a sucker. The moment there's another sucker willing to work for cheaper (or free) you'll be in the rear-view mirror. Companies are not people. A company is not that one guy you like that works there. A company is a soulless meat grinder designed to sacrifice as many lives to the god of green as possible.
Treat it as such, because no matter how nice you are it will treat you as such.
/2cents
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Hi Brian,
"Note: this is not advice, nor is it Devine guidance. This is only my opinion."
From what you wrote, you have done work for them and gotten paid for it. So they know you and they know the quality of your work. So we are out of the "getting to know you" phase of a business relationship.
It is the nature of businesses to push for as much free stuff as possible. It is no reflection on you or trying to take advantage of you. It is just the nature of business.
It is a business decision on your part if you want to give something away. My rule of thumb is if the question can be answered in a sentence or maybe a "yes" or "no" then sure it is a free chat giveaway. But if the answer requires significant, specialized knowledge then the proper answer is "I would be thrilled to assist you in this new venture. I feel that I can play a significant part in helping you to succeed. I'll shoot a contract over to you and we can get started as soon as I get the approval back."
If they balk then you were not going to get the business anyway.
Again, only my humble opinion and not sage advice.
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Brian C Hart wrote: My business guy says, "Provide them free services for now to 'build relationship' and 'make them like you' in hopes they will pay later.
This is often never-ending.
Many years ago, i was in a company where our team was 'building credibility' in the first year. This continued in the second year also, and so on, for three more years. In the end, am not sure whether we had built 'enough credibility' at all. Meanwhile, i moved to a different team.
modified yesterday.
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Last week I watched an Adam Savage post which touched on that.
The conclusion is generally -- ![Elephant | [mastadon]](https://www.codeproject.com/script/Forums/Images/elephant.gif) U, pay me!
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Brian C Hart wrote: Am I being played for a sucka?
I'm afraid your client is taking advantage of your good nature and acting in an unprofessional manner. It may be time for polite but firm communication from you (or better yet from your business guy) stating they will now be required to pay for services rendered.
Brian C Hart wrote: My business guy says, "Provide them free services for now to 'build relationship' and 'make them like you' in hopes they will pay later.
If your business guy is relying on hope, IMHO he's inexperienced, not qualified for the job or both. Sorry, but that's not how business is done. I may not be the sharpest knife in the drawer, but I've worked at enough successful early stage companies to appreciate bending over backwards for your early and first marquee customers without giving away the kitchen sink.
/ravi
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A thing I learned years ago; never work for free. Let's say you are the other company, and you get used to getting free consultancy/services from you. At what point would you think, "hey, let's start paying these guys now"? The chances are that you never would, after all if someone is a sucker enough to do work for free, why would you think that you should start paying?
Your friend is being very naive in this approach. Businesses very rarely award business to others based on them liking you. They award business because you provide a service that they need and which they don't currently have.
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Musicians fight this all the time. "Play in my club! I can't/won't pay you, but the exposure will help you get future gigs!"
There are no solutions, only trade-offs. - Thomas Sowell
A day can really slip by when you're deliberately avoiding what you're supposed to do.
- Calvin (Bill Watterson, Calvin & Hobbes)
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But musicians do get exposure this way and for some it works out very well.
A physicist doing tasks for a business? Not so much exposure there, unfortunately.
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obeobe wrote: But musicians do get exposure this way and for some it works out very well.
As a former professional musician with lots of professional musician friends and acquaintances here in Nashville and in NY and LA and a constant ear to the business I can tell you with 100% confidence that this "works out" so infrequently as to be statistically zero.
There are no solutions, only trade-offs. - Thomas Sowell
A day can really slip by when you're deliberately avoiding what you're supposed to do.
- Calvin (Bill Watterson, Calvin & Hobbes)
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Allowing precedents to be set can cut both ways. I understand trying to build up a business relation, but what's a business relation anyway if it doesn't involve the exchange of money?
If you show you're willing to do some valuable work for them for free, at what point are you allowed to say ok, that's enough, now you need to compensate me for that work...?
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I'm going to go against the grain here. In my experience, it is not at all uncommon to put in the work up front and trust that the quality of your work will pay off in the end. I'm mostly referring to actual software here, not advising on a grant. A company with deep pockets should have no problem paying for consultant work, and you should have no problem asking them.
Personally, I'm 7 months into a SaaS project where the customer expects a system that looks exactly like their old system...down to colors, fonts, layout, etc. All we have charged them for so far is 20 hours for custom design work. They've gotten a lot for free based on the expectations of a complete system. Unfortunately, software is never complete. When it's a 'rented' solution, it's often difficult to determine wants from needs. 
"Go forth into the source" - Neal Morse
"Hope is contagious"
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kmoorevs wrote: Personally, I'm 7 months into a SaaS project
kmoorevs wrote: All we have charged them for so far is 20 hours
What's your gut feeling--when's the payoff? I hope you're not dealing with a single individual, but are regularly in contact with an entire team and have things written down. Otherwise I'd think you might be dealing with some middle-manager who wants to get his problems solved for himself, and once everything is said and done, he's gonna look good, cut you off, and none of the higher-ups will even be aware of the situation.
Remember that some companies have asked people to fix bugs for them "as part of an extended interview process". Either they don't get their bugs fixed (so, no loss to them), or they do, but then find some excuse not to hire the sucker who did the work.
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dandy72 wrote: when's the payoff?
From my calculations, around 2 years. If we can find other customers, that would be great, but I don't have a lot of faith in my sales person.
We have team meetings at least every other week and so far, they seem impressed with the rate of progress and the final product.
"Go forth into the source" - Neal Morse
"Hope is contagious"
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Fair enough.
Let me go hypothetical here.
Say, a higher-up is not aware of this project and arbitrarily decides this is not an area they want to keep investing in. No amount of pleading makes any difference, the order came from "high up".
What then, for you?
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IMHO if you're volunteering your time, there is a limit. And if you've been helping them for MONTHS, I'm guessing you've passed that limit.
Whenever someone tries to sell me something that I really don't want or need I use the excuse that it's just not in my budget. They can't argue with that. I think you could reverse it and just tell them that things have changed and you can't afford to keep doing it this way. You might lose them. But hopefully they know the value of your time and will pony up the cash.
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Been there, done that WENT BROKE. Your respected friend needs a wake up call.
Never underestimate the power of human stupidity -
RAH
I'm old. I know stuff - JSOP
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Below is a quote from Warren Buffet. Right now, you are losing money. If your work is of value, then you should be paid for it. If they are not paying for it, they are not a customer they are a thief.
On making money.
"The first rule of an investment is don't lose (money). And the second rule of an investment is don't forget the first rule. And that's all the rules there are."
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Paul Harrington 2021 wrote: "The first rule of an investment is don't lose (money). And the second rule of an investment is don't forget the first rule. And that's all the rules there are."
This would've simplified the Ferengi Rules of Acquisition(tm).
This a programmer's site. No way this is too obscure a reference for most of us.
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Personally, I think that it is not at all unreasonable to help out a potential customer for free.
In your case, since you try to behave as rational as possible it should be easy to establish a
point of no return. The potential project will make you X dollars, you charge Y dollars/hour so
don't work more than X/Y hours on it for free. Obviously you want to keep this ratio as small as
possible. But at least you have a hard number for reference, so don't do more than 10% of X/Y for free.
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In my experience - never work for free for a business.
If anything - it will make them appreciate you and your services LESS.
But like anything in life, there can be exceptions. You've already worked with this business for three years, but this couple of months they have a cash flow problem and ask to delay their payment by a few months? That might be fine.
But what you described doesn't seem justified.
If the business is just starting up then maybe it makes sense to give them a lower rate for a limited period (as long as it's still worth your while), or maybe take some of the compensation in stocks or stock options.
But don't work for free.
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What they are doing with the rest of their funds isn't really relevant to your conversation. I'm not at all saying it isn't aggravating, but building a plant is different than consulting work, and would generally come from a different budget item; certainly capital vs expense.
There are grant writers who get paid on a success basis contract, and they can vary wildly in terms.
From a consultant point of view, it's a tough call. We've gone as far as building an MVP and successfully getting a contract from it, but my general thinking is the doable concept approach. It's a statement of what we'll do, not a recipe of how we'll do it. Don't give away the store.
There's no generic answer and it's easy for us to go one way or another on principle, but only you can tell if you're being taken advantage of. I don't like the 12:01 AM line in the sand idea; it's better to talk it through with an explanation that time is your product, blah blah blah. See where that goes.
We recently did a POC for a client that required complex approval from several other players. It worked, but we did not get the approval from other players for reasons having nothing to do with us or our client. As it started to go south, I discussed with the client some reasonable cost recovery and got agreement on it. But again, only you know the feasibility of that. But again, don't let your view be biased by other operations of the company.
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MikeCO10 wrote: What they are doing with the rest of their funds isn't really relevant to your conversation. I'm not at all saying it isn't aggravating, but building a plant is different than consulting work, and would generally come from a different budget item; certainly capital vs expense.
The simpleton in me wants to summarize this as "if you have money for X, then surely you have money for Y" (especially when Y is a tiny fraction of X).
But I totally understand the idea of different budgets being allocated to different groups operating within the same company. Or even for companies making money hand over fist, but "not having something in the budget until next quarter" (or next year).
I forget whether I had a point to make at all or not...
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The business world has this idea of the lagniappe[^]. Think of the free pens you can get at a business convention. These are usually small, cheap items that help to remind the customer of your business.
In the art world, people always try to get free art by paying in "exposure" for the artist. Serious artists know that the "exposure" is never worth it and they should be paid fairly for their work.
As a tech producer, you are in the business world, so giving away something like a pen might be worth it, but a complete product is not. Some people think software engineering is a form of art. If you agree, then you shouldn't ever give any of it away for free.
In short, always get paid for your work. If you offer a fair price and a good product/service, then you have built the business relationship by being a trustworthy partner.
Bond
Keep all things as simple as possible, but no simpler. -said someone, somewhere
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