prototyping your business with dan mall
DESCRIPTION
As designers and developers, we’re used to prototyping our ideas; that is, we roughly test concepts to see if there’s any merit in them before committing to a full-scale effort. Why don’t we do this with our businesses? In this session, we’ll talk about how to apply the same approaches from building sites and apps to iterating on contracts, billing options, project cycles, presenting work, and all the other stuff that pays the bills—and pays them well.TRANSCRIPT
Prototypingyour business
@d!nielm!ll d!n@d!nielm!ll.com
Design
Illustration
iOS
Motion Graphics
JavaScript
“Portfolio piece”
“More work”
Wh" do we just de!l with this?
Business isn’t a science.
Business is an art.
“Desi#n” isn’t limited to the thin#s we m!ke.
Desi#n "our process. Desi#n "our business.
Business is an art.
Founder $ Desi#n Director
Business is an art.Desi#n Director
Business is an art.
Inter!ctive Director
february 2011
With ! %ull-time s!l!r" !s ! b!ckup, I w!s %ree to experiment with m" business.
I w!s %ree to protot"pe.
prototypeA w!" to test ! h"pothesis.
webdesignforidiots.net/2012/11/plan-learning-to-wire-frame/
How much should I charge?
I can make good moneyon side work
H"pothesis
I can makegood moneyon side work
H"pothesis
rate cards
Principal
Art Director
Sr. Designer
Jr. Designer
Intern
$250/hr
$200/hr
$150/hr
$100/hr
$100/hr
Principal
Art Director
Sr. Designer
Jr. Designer
Intern
$250/hr
$200/hr
$150/hr
$100/hr
$100/hr
Hourly ratesSpoiler: hourl" r!tes suck.
$25
$50
$100
$200
$400
$800D
For me, it w!s di%%icult to convince ! client to p!" more th!n $150/hr.
No one went to school to be ! client.
paid hourly—$7/hr
paid hourly—$70/hr
paid hourly but went to school for 7 years
$375/hr
Hourl" r!tes don’t sc!le with experience.
Hourly Rate $ 100
Hourly Rate
Hours
$ 100
10×
Hourly Rate
Hours
Total
$ 100
10
$1000
×
Hourly Rate
Hours
Total
$ 100
10
$1000
×
$ 100
Hourly Rate
Hours
Total
$ 100
10
$1000
$ 100
5× ×
Hourly Rate
Hours
Total
$ 100
10
$1000
$ 100
5
$ 500
× ×
Hourly Rate
Hours
Total
$ 100
10
$1000
$ 200
5
$1000
× ×
Hourly Rate
Hours
Total
$ 100
10
$1000
$ 400
5
$2000
× ×
Hourly Rate
Hours
Total
$ 100
10
$1000
$ 200
10
$2000
× ×
Hourly Rate
Hours
Total
$ 100
10
$1000
$ 100
20
$2000
× ×
Hourl" r!tes incentivize "ou to be slower.
Director of Client Service
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service $ 533/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
$ 533/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
$ 533/hr
$ 601/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
$ 533/hr
$ 601/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
$ 533/hr
$ 601/hr
$ 427/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
Chief Creative Director
$ 533/hr
$ 601/hr
$ 427/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
Chief Creative Director
$ 533/hr
$ 601/hr
$ 427/hr
$ 964/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
Chief Creative Director
Executive Media Director
$ 533/hr
$ 601/hr
$ 427/hr
$ 964/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
Chief Creative Director
Executive Media Director
$ 533/hr
$ 601/hr
$ 427/hr
$ 964/hr
$ 478/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
Chief Creative Director
Executive Media Director
Executive Director Print Production
$ 533/hr
$ 601/hr
$ 427/hr
$ 964/hr
$ 478/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
Director of Client Service
Executive Director Account Planning
Executive Research Director
Chief Creative Director
Executive Media Director
Executive Director Print Production
$ 533/hr
$ 601/hr
$ 427/hr
$ 964/hr
$ 478/hr
$ 391/hr
2008 Hourl! Billin" R#tes* Over 500 employees—http://dmall.me/15CxrwU
t
t
Time
Ye!rs in business
Clients should not be p!"in# %or our time. The" should be p!"in# %or our expertise.
if not hourly, then what?
Fixed pricing
Hourly Rate
Hours
Total
$ 100
10
$1000
×
Hourly Rate
Hours
Total
$ 100
10
$1000
×
Hourly Rate
Hours
Total
$ 100
10
$1000
×
Hourly Rate
Hours
Total
$ 100
5
$1000
×
v
Hourly Rate
Hours
Total
$ 100
15
$1000
×
v
value pricing
0
V!lue pricin# is not the s!me !s %ixed pricin#.
* However, %ixed pricin# is one t"pe o% v!lue pricin#.
V!lue pricin# o%ten h!s little to do with the project itsel%.
It’s more !bout the service provider !nd the client.
1. touchy feely.
2. cool & calculated.
1. touchy feely.
2. cool & calculated.
1. touchy feely.
2. Cool & calculated.
danielmall.com/articles/object-value-pricing/
Trust "our #ut.
1. touchy feely.
2. cool & calculated.
Fi#ure out wh!t "ou need to e!rn.
Health Insurance
Gym
Mortgage
TV Services
Auto expenses
Groceries
Misc shopping
Student loan
$472.62
$79.98
$700.00
$25.99
$887.27
$400
$407
$128.09
Taxes
Phone
Water
Electric
Tithe
Property Tax
Sewer Dept.
Misc.
$1000.00
$200.00
$80.00
$125.00
$300.00
$100
$33
$2000
$6938.95Tot!l
Round numbers m!ke the m!th e!s".
1 month project = $10K
2 week project = $5K
2 month project = $20K
1 month project = $10K
danielmall.com/articles/superfriendly-annual-report-2012
February 2012
1-month project, $10K
February 2012
1-month project, $10KMarch 2012
1-month project, $10K
February 2012
1-month project, $10KMarch 2012
1-month project, $10KApril 2012
1-month project, $30K
February 2012
1-month project, $10KMarch 2012
1-month project, $10KApril 2012
1-month project, $30KMay 2012
When "ou’re !he!d on c!sh%low, "ou h!ve the %reedom to be pick",
rel!xed, or !mbitious.
When "ou’re !he!d on c!sh%low, "ou !re more v!lu!ble.
V!lue-b!sed pricin# is !bout how v!lu!ble "ou !re.
V!lue-b!sed pricin# is !bout how v!lu!ble "ou !re (!t !n" #iven time).
Save-the-date
They Really want to work with me.
H"pothesis
I’ll be honest: m" time is in dem!nd. To reserve ! speci%ic time%r!me %or "our project, "ou c!n opt into !n !ddition!l ret!iner which #u!r!ntees th!t "our project is m" %irst priorit" st!rtin# October 30. This ret!iner is non-re%und!ble.
I choose to immedi!tel" reserve this time%r!me %or m" project !nd will send $7500 !lon# with the si#ned contr!ct.
budgetThe B-Word
Wh!t’s "our bud#et?You
Well, we’d like to he!r wh!t numbers "ou come up with.
Client
[li#hts h!ir on %ire]You
?
$60K
$60K
$35K
$60K
$105K
The M!#ic Question
“Is it closer to three thous!nd, thirt" thous!nd, or three hundred thous!nd?”
The M!#ic Question
“Bud#et” = This is wh!t I think "ou’re worth
The Questionnaire
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t size is the project te!m on "our end? Would it just be "ou? Or would it be ! whole te!m on "our end?
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t size is the project te!m on "our end? Would it just be "ou? Or would it be ! whole te!m on "our end?
• How did "ou he!r !bout our work? Wh!t speci%ic!ll" interests "ou !bout it? An" p!rticul!r projects th!t "ou're keen on?
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t size is the project te!m on "our end? Would it just be "ou? Or would it be ! whole te!m on "our end?
• How did "ou he!r !bout our work? Wh!t speci%ic!ll" interests "ou !bout it? An" p!rticul!r projects th!t "ou're keen on?
• Are there other people th!t "ou’re t!lkin# to !bout this project? Mi#ht I !sk how m!n"? Wh!t do "ou like !bout their work?
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t size is the project te!m on "our end? Would it just be "ou? Or would it be ! whole te!m on "our end?
• How did "ou he!r !bout our work? Wh!t speci%ic!ll" interests "ou !bout it? An" p!rticul!r projects th!t "ou're keen on?
• Are there other people th!t "ou’re t!lkin# to !bout this project? Mi#ht I !sk how m!n"? Wh!t do "ou like !bout their work?
• Wh!t kind o% bud#et do "ou h!ve !lloc!ted %or this project?
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t size is the project te!m on "our end? Would it just be "ou? Or would it be ! whole te!m on "our end?
• How did "ou he!r !bout our work? Wh!t speci%ic!ll" interests "ou !bout it? An" p!rticul!r projects th!t "ou're keen on?
• Are there other people th!t "ou’re t!lkin# to !bout this project? Mi#ht I !sk how m!n"? Wh!t do "ou like !bout their work?
• Wh!t kind o% bud#et do "ou h!ve !lloc!ted %or this project?
• Wh!t !re "ou speci%ic!ll" lookin# %or %rom me? Do "ou !lre!d" h!ve developers or other p!rtners lined up !nd !re lookin# to us just %or desi#n? Or do "ou w!nt the whole thin# desi#ned !nd built?
• Wh!t kind o% time%r!me !re we lookin# !t? Is there ! cert!in event or d!te th!t is dependent on this site l!unchin#? On m" end, the soonest !v!il!bilit" I h!ve to st!rt this is in _____________. In the spirit o% %ull disclosure, I !lso h!ve !nother prospective client interested in the s!me time slot.
• Is there !n" work !lre!d" st!rted th!t I should know !bout? A new lo#o? Some rou#h desi#ns or ide!s %or the site?
• Wh!t size is the project te!m on "our end? Would it just be "ou? Or would it be ! whole te!m on "our end?
• How did "ou he!r !bout our work? Wh!t speci%ic!ll" interests "ou !bout it? An" p!rticul!r projects th!t "ou're keen on?
• Are there other people th!t "ou’re t!lkin# to !bout this project? Mi#ht I !sk how m!n"? Wh!t do "ou like !bout their work?
• Wh!t kind o% bud#et do "ou h!ve !lloc!ted %or this project?
• Wh!t !re "ou speci%ic!ll" lookin# %or %rom me? Do "ou !lre!d" h!ve developers or other p!rtners lined up !nd !re lookin# to us just %or desi#n? Or do "ou w!nt the whole thin# desi#ned !nd built?
• An"thin# else th!t I should know !bout wh!t "ou’re lookin# %or %rom me?
performance-based compensation
V!lue Pricin#
Equit", s!les bonuses, incentives, etc
Cashflow
When should "ou #et p!id?
50%-50%
Thirds
Good c!sh%low is !bout miti#!tin# risk.
Biweekly
97%
Further areas to prototype
Contracts
Contracts
stuffandnonsense.co.uk/projects/contract-killer
Proposals/pitches
Language
When "ou w!nt numbers to seem low, use “K.” When "ou w!nt them to seem hi#h, write out the %ull number.
Pro Tip
“While our competitor mi#ht be ch!r#in# "ou $372,000.00, we’re con%ident we could #et it done %or
!bout $254K.
Ex!mple
Wh!t clients w!nt to bu" more th!n !n"thin# is trust.
businessolo#"show.biz @bizolo#"show in%o@businessolo#"show.biz
Wh!t clients w!nt to bu" more th!n !n"thin# is trust.
The more time "ou spend buildin# trust, the better "our business will be.
Thanks!B u
@d!nielm!ll d!n@d!nielm!ll.com