Words matter so let’s start there. 

There is a difference between pulling back from something and not doing it.

The title of this guide is “Why I Pulled Back from Traditional Consulting”, NOT “Why I Stopped Doing Traditional Consulting.”

I still take on regular fee for service projects from time to time but only if they really excite me.

In this guide, I want to share with you the small shift in focus that happens when you decide to pursue a different goal. 

This guide describes the part of my journey where I shifted from Freelancer to Profit Partner.

A Profit Partner is someone who creates a new revenue engine for their client and shares in the profit this new engine generates. 

It requires investing your time, possibly for no pay, and can involve risking some of your capital. 

This approach was appealing to me because I saw that I could have Unlimited Upside.

One of the affirmations in my morning ritual was (and is) “I get paid based on results.”

If you haven’t read the other two parts of my journey that led to this shift, it would be a good idea to stop here and do that. 

Read Part 1 here and Part 2 here.

If getting paid based on results isn’t appealing to you, that’s ok. 

There’s nothing wrong with traditional,” fee for service” consulting. It just wasn’t what I wanted to rely on. 

So the Profit Partner route may not be for you. 

But regardless of the path you choose, I think this next part will be a helpful perspective for you to internalize.

Sell the After Photo

When you become a freelancer you are taking a skill or set of skills and selling them to someone else who needs the result of those skills. 

If you know how to buy Facebook ads, you have a stack of skills that others will pay for because they know what a successfully run Facebook ad campaign can do for their business.

They aren’t paying you for the skills. 

They’re actually paying for the results your skills can produce when correctly applied.

They want to move from their current state to a new state. There’s a clear “before” and “after.”

You are the key to their “after.”

For example, when my first client, The Foundation, hired me to produce a podcast, the goal of the podcast was to generate new leads. 

The podcast itself was not the end goal. The end goal was to create leads for the next launch and connect deeper with the people who influenced our target audience.

Think about the service you offer…or would offer if you’re not there yet.

If your service stopped producing results for your client, would they continue to pay you? 

Probably not.

And what kind of results are we talking about? 

For me, I focused on developing skills that would produce a PROFIT for my client(s). 

If you cannot create new revenue streams for your clients then there will be no opportunity for you to share in the new revenue you’ve created. 

If you are making someone money, why would they stop working with you?

This is one of the aspects I love about Direct Response Marketing.

Every dollar you spend or action you take as a direct marketer is measurable and accountable. 

This is why I recommend learning Direct Response; especially if you enjoy things like writing, sales, design, video production, psychology or persuasion. 

I have a Direct Response 101 course that shows you the different paths you can go down based on your interests here.

Whether you’re interested in learning Direct Response or not, for the purposes of this guide the important takeaway for you is that to move from Freelancer to Profit Partner, you need a skill that can generate a profit for someone consistently.

That’s step 1. 

Having originally moved to Nashville back in 2003 as a songwriter, I naturally liked writing so I spent more time learning the principles of copywriting (ie: salesmanship in print).

To be good at copywriting you have to be good at understanding human psychology, how people think and what your audience truly desires.

You then spend all of your time building a bridge with your words to help them easily move from where they are to where they desire to be. 

Copywriting may not be your thing and that’s fine. You still want to understand the principles that make good copy produce a sale. 

As you work with your clients you will begin to have a deep understanding of the market their business serves.

In direct response you really never stop learning about your customers. You want to know all of their likes and dislikes, their hopes and dreams and the secret dreams they’re maybe too afraid to share with anyone else. 

You’re trying to enter the conversations they’re having in their heads.

It takes time and you want to be interested in the market/niche.

I found that after 1-2 years working with a client, I started to notice desires in the market that my client’s product line didn’t address. 

I call these Product Gaps and I would just keep a list of product opportunities I saw.

Maybe one day I would want to build my own offers around these product ideas. Or maybe, if I enjoyed working with my client, I would present the opportunity to them. 

Either way, I saw this as a good practice because at the very least I got the idea out of my head.

My First Profit Partner Deal

Before we dive in, I want you to know that I’m not going to share the names of my clients, their products and their niche’s as we get into this. Those details aren’t important to understand the process and the structure of the Profit Partner model.

Fair enough? I hope so! 🙂  

My first Profit Partner deal was pretty low risk for both me and my client. 

I had been working with him for more than a year so we trusted each other. 

Trust is key.

But the way I approached this deal was by first identifying an existing product that was plateauing in my client’s portfolio with 2+ years of sales data.

I used this data to get an average monthly baseline.

My idea was to optimize this product’s marketing funnel to increase average monthly sales above baseline. 

The pitch to my client was I’ll do all the work to optimize this funnel and improve sales for free.

If I can get monthly sales above baseline, you and I will split the “above baseline” amount 50/50. 

It’s a pretty good deal right? 

I didn’t make a lot of money from this deal but I’d gotten my first “yes” on a deal structure that allowed me to separate my pay from the amount of time I worked.

But here’s another way I could have structured this deal to reduce the risk even more.

I could have negotiated a fee so that I got paid for my time to optimize the funnel. The fee would be against future commissions. 

So I still would get 50/50 above baseline but only after the client had recouped the fee he paid me. 

I have done these types of deal structures with clients many times. 

This model I’ve just described can be a great blended approach for you if fee for service consulting is what you do and enjoy. 

You’re sort of placing these small bets on opportunities you see in your client’s product portfolio.

You don’t have to go to the next Profit Partner level if you don’t want to.

The Next Level

The next level in the Profit Partner model is achieved when you create an entirely new product for your client. 

This carries the highest risk and demand on your time. But it can also come with the highest payouts.

I have created three entirely new products for clients. 

Two of the three each pay me six figures annually. That’s two separate products in two separate niches that each pay me six figures a year for work I did once. 

Now I manage the system with a virtual assistant.

The third product pays out a few thousand each month. 

Mentioning my VA reminds me of something else I want to call out for you.

When I presented the product opportunity that I saw to my clients and pitched them on letting me build it for them, I was also committing to be the one to build the operation to support it.

• How will customer service work?
• If it’s a physical product how will sourcing and fulfillment happen? 
• Is there inventory management?
• Do we need a different 1-800 number and who will answer those calls?

I’ve built out all of this and more in the deals I mentioned above.  

It’s a lot of work but I found I was so motivated because this structure was in line with how I wanted to be paid. 

My experience is that big goals take a lot longer to achieve than we think they will. 

Years instead of months. 

But hopefully the lessons I’m sharing here will help you get there faster.

The process for finding product opportunities at this level is the same as the previous level where you’re just optimizing something that already exists.

You are still listening to the market and collecting data to help you spot opportunities.

If you need help knowing how to listen to the market, I’ll tell you one thing that has worked for me.

I ask my client for access to the email address customers and potential customers are told to use if they have questions. 

If you read emails from customers and potential customers every day for a few months, you will begin to understand how they talk, what problems they want solved and where your client’s existing products fall short. 

Yes you will also hear from customers who just want to gripe and complain. 

But I don’t know of a better way to understand WHO your client is serving than by studying customer service interactions every day. 

Even better if you can take some of the calls or answer some of the emails. 

Wrapping Up

This is the process I’ve followed to shift from Freelancer to Profit Partner.

I didn’t have to start my own business to get paid for work I did once.

And the lessons I’ve learned from creating new products and building out the support for them are invaluable to me. 

Those lessons are things that I share freely with you if you’re on my email list.

I’ve done my best to be as detailed as necessary so you can understand the Profit Partner concept and the different ways I’ve structured my deals. 

There are certainly other ways to structure these. But I can only speak to what I’ve done. 

If this is an approach to consulting that you would like to learn more about, I offer a LIVE training regularly where I teach how to make the switch to being a Profit Partner.

You can hop on the waiting list right here.