Jonathan Stark and why you should not bill by the hour
Jonathan Stark is the “ditch the hourly rate” guy.
He’s spent years convincing experts that charging by the hour is the worst deal they can make for themselves and their clients. He has a book, a podcast, and a newsletter to prove he means it.
I went through his content and pulled out 3 ideas that changed how I think about pricing and that I think apply well beyond consulting.
Here’s comes my 3 visual lessons for you
1)Don’t bait your hook with food you like
The client will be attracted to the things he recognizes and cares (the symptoms)
If you only lead with the problems (your interest) you gonna be fishing for hours
I know, it sounds simple, right?
But a lot of people will try to attract them, leading with stuff that they like (not the client).
Pay attention to what you put in your hooks (metaphorically and literally, haha)
Are you using the right bait?
2)The hidden assumption about productivity
This is a great topic I found among Jonathan’s newsletters.
How often are we chasing productivity but paying little attention to the impact it brings?
Trying the latest automations to pump more content
Sending more DMs
Creating more offers
In my view, making more stuff faster is only a productivity increase if the “stuff” you’re making is customer satisfaction.
If what you are optimizing doesn’t add value, is it worth optimizing for it at all?
I’ll leave you with that
3)Charging per hour in the A.I era is just insane
Now, I kept the best for last
Something that if you are not aware, can be super dangerous for your business.
If - like most professional service businesses - your business model is based on trading time for money, AI poses a serious threat.
Jonathan is an advocate for not billing per hour, and instead charge for the value you create.
I think most of us agree here.
But when we consider the current landscape with AI making operational work waaaay faster than it used to be.
Makes charging per hour even more insane than it used to be.
Because if a logo used to take 100h to make.
Ai can make it in 1min
How do you charge for that? 😅
Resources & Links
I just finished reading the Brain Audit and I highly recommend
If you have a newsletter, I’ve got something for you
this is my most recent favorite podcast