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You don't come cheap

Picture of Jeff Sauer

It may sound counterintuitive, but the more work you do in your own business, the less profitable you become.

As the founder, you are the most expensive resource. 

Your time comes at a steep premium because of opportunity cost.

Let’s say you pay yourself $100k per year.

That works to just $50 an hour if you worked 2,000 hours yearly. 

When you factor in the value of pursuing new opportunities and strategic growth, the opportunity cost is much higher. 

Upwards of $500 to $5,000 an hour.

But there’s no amount you could reasonably charge clients that would adequately capture the true value you bring to your business. 

You price yourself out of profitability by doing all the client work yourself.

So how do you reconcile being the most capable person but also the most expensive?

It starts with being strategic about the direct work you take on. 

This may feel uncomfortable, but it’s vital.

You need to focus the bulk of your time on higher-value, “one-of-one” activities:

  • Pursuing new prospect opportunities
  • Setting the vision
  • Leading your team
This allows you better to delegate operational work to less expensive team members. 

So you can allow your processes and training to ensure quality outcomes.

This allows you to blend the expensive with the inexpensive and generate the same result for a fair price.

My blended rate approach reduces costs and frees up time to drive growth. 

More gets done at a lower average cost.

You are more profitable and clients are happier with the fees they pay.

This gives you something to offer all types of clients:

Premium: Position yourself as the premium option if they want your hands-on work. Charge a mint, and be prepared to push back.

Reasonable: Deploy your team to deliver similar results at a more attractive price point through your proven systems.

Instead of being the mercenary who does all fighting, you act like the commander who leads a powerful army.

This shift is hard but necessary for you to scale your business. 

Your value is highest when focused on strategy, vision, and opportunity… not tactical work.

The market won’t bear what you are truly worth as an individual contributor. 

There is a ceiling to your value on the open market. 

But there is never a ceiling on what your business can achieve. 

Building a team allows you to capture that value through scale, profit, and growth.

Doing less yourself is counterintuitive but empowering. 

How do you think I find the free time to write this newsletter every week?