How much money my business made in Q1 2023

I share real revenue numbers for Q1

April 1, 2023: It's been less than 90 days since I quit my job to start my 1-person privacy consulting business. I've been exploring the solopreneur path, focused on personal brand building, and testing out new ideas - like a free 5-day privacy email course.

If we haven't met yet, welcome! Shoot me message, would love to connect.

#1 The Preface

I only share these numbers for folks subscribed to my newsletter so please don't forward this specific email. Bad for growth, I know, but this one is a bit more personal. You should forward all the others.

It's not to boast or brag. To be honest, you probably won't be impressed at all. This is more a running diary.

Something for me to look back on and say 'wow, remember when?' Or for my son to look back on and say 'wow dad, you really quit a good paying job when I was baby? You're nuts!'

Maybe this transparency inspires one person to bet on themselves. That's enough for me.

I still have SO MUCH to learn about running this business. And that's fun to think about.

#2 How I Set My Goals

I will hit any goal in front of me, as long as I believe I can do it. That's just who I am.

For me, the outcome is as big as the goal you set. The bigger the goal the bigger the hustle. Starting this new venture, it was important for me to set realistic and tangible goals but they had to make me slightly nervous.

Goals are like magnets. They’ll attract the things that make them come true.

- Tony Robbins

Achieving one goal helps unlock your next goal. I need to see the little wins to chase the big wins.

Goals are like ketchup - when it comes out (of the bottle) it all comes out at once.

- Cristiano Ronaldo

My revenue goal for 2023 is $300,000.

Now, where does this number come from? Pretty simple. I sent a pay slip to my accountant and said, 'how much money do I need to make to replace my salary?'

My last job I was salaried at $220,000/year with full benefits.

That number is intimidating but feels achievable so here we are!

#3 Goals I Track

There are two numbers I track every week:

  • Closed Won Revenue

  • Realized Revenue

Closed Won Revenue: when a new SOW gets signed, that full contract value is tied to this goal.

  • Why is this number important: the death of an independent consultant is a dry pipeline. I need to be hyper vigilant that I'm regularly pursuing and winning work to hit my big $300k number.

Realize Revenue: this is money that actually hits the bank account. Getting paid is probably the hardest part of running an independent business and the most important. If I don't get paid, we don't eat. Pretty simple.

  • Why is this number important: Money in the bank pays the bills. Pretty important. Tracking this helps me prioritize cash flow and structure my SOWs to get paid at least 50% up front so funds are stuck pending 45 days before getting paid.

There's are two other goals that I track that balances this all out.

Project Profitability: I aim for 80%+ profit margins on every project. 

  • I subcontract maybe 10-20% of my work.

  • This is an area for me to be cautious because the more I sub the less money that hits the bank.

  • That said, it frees me up from doing work that I hate - like documentation - so I've built an onshore/offshore group of resources for specialized support.

Time Worked: My personal goal is to work less that 35hrs/week any given week.

  • Might as well get a W2 and good insurance if I'm not going to have any personal free time. Right now I work less than 20hrs/week.

  • This varies based on project load and how you classify 'work'. I'd say writing this newsletter is now part of my job.

  • This is really only possible because the vast majority of my work is fixed fee vs time & materials (hourly) projects.

#4 The Real Numbers 73 days in

  • Closed Won Revenue: $102,030 (136.04% of goal)

  • Realized Revenue: $90,030 (120.04% of goal)

  • Expenses: $14,335.02

  • EBITDA: $75,694.98 (125.91% of goal)

  • Quarterly Take Home (Salary + Distributions): ~$45,416.99

  • Average Project Profit Margin*: 96.59%

  • Full Business Margins: 84.08%

  • Number of Clients: 5

  • Source of business: 3 from Upwork. 1 from Alliance. 1 from person referral. This is shifting to be more Alliance driven which is both good & bad.

  • Marketing Spend: $761.35 (presentation build, client lunches/coffee, etc.)

  • Admin Spend: $98.67 (Google Workspace, ClickUp)

Still need to talk to my accountant to make sure that the model still makes sense now that we have real numbers to look at.

*Average project profit margin is inflated due to a few a small ad hoc UpWork projects. The true margin for the big fixed fee work sits more around 89%. Still happy with this.

#5 No Baseline

What I find super interesting is that I have no baseline or comparison for this. No peer group to tell me I'm under charging or way ahead.

So if you do similar business, I'd be curious you're feedback.

I liken this phase of building to walking around in the dark with my arms out. Feeling my way through the situation. Building a mental map of the path and potential obstacles. It's fun, if we're being honest!

Q2 will be fun to look back on since we'll have real data to compare to quarter over quarter.

#6 Don't Move the Goalpost (yet)

I naturally want to achieve more. Can't help myself. But I'm resisting the urge to change my goal for 2023. Q1 success does not equal Q2 success. Q2 makes me slightly queasy which means it's still the right goal for me.

Q2 pipeline is strong but very reliant on one big account. My efforts the last two weeks have been forward looking to close out my receivables and start getting proposals out for Q2.

Lots of work left to do for my 2023 goal. Taking it one elephant sized bite at a time.

So. What questions do you have? Let me know.

Side Projects

The End

2023 is about building for me. I'd love to grab coffee/chai or jump on a quick call. Shoot me a text and we can schedule something. 404-731-7814. Go big! - Nik Fuller

In Search Of

Anyone interested in being interviewed for a video podcast? I want to talk to my friends and share all the cool things they are up to.

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