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Starting My Own Tech Support Business
SeñorAmor
Registered User regular
Registered User regular
Bear with me here, please. This is likely going to be ramble-y and longish.
I am currently the sole IT person at my company. I wear many hats. I am a web developer, network and server admin, computer builder and fixer, and I go out and do any necessary programming for devices we sell and install.
Over the course of the many years I've worked here, I've frequently dealt with clients that either do not have, or do not need a full-time IT person. On countless occasions, I've been asked to help with some sort of computer or techie-related problem. If it wasn't too obscene a request, I've always tried my best to consult and help. Many times a client has commented that it would be nice to have me around to help when needed instead of using the 3rd party support service they currently use (and paying a sizable sum, to boot).
I have always wanted to work for myself and do consulting and/or IT work for companies who cannot afford to have an IT person on staff, and I've toyed with the idea for several years now.
My thought is to have each client pay a set amount each month to keep me on retainer (so to speak) and then pay a nominal hourly charge. As work is required, they would call me to schedule an appointment, at which time I would complete whatever task they have for me. I was thinking of having several (perhaps 3) different plans with different pricing. The higher the monthly charge, the less the hourly charge, with each plan including a set number of hours per month (before incurring any additional hourly fees).
My goal is to have a pricing structure that is low enough to entice customers to use me as their IT solution, thus guaranteeing me recurring monthly income.
As my talks have been with current clients, I have been very careful engage only in conversations that do not apply to work that I would normally perform with my current employer (e.g. we install product X, I would not perform any work on product X so as to not take money away from/burn bridges with my current employer). I believe there would be a significant amount of alternate work I could perform that wouldn't mean my stepping on any toes.
(Side note: several months ago I entertained an offer with another company, which ultimately did not pan out. Upon telling my current employers of my desire to leave, they actually suggested contracting me to do any necessary work they may need. I would actually like to find a way to have them be one of my clients, should I go through with this plan.)
With a wife and two kids, I'm scared to take a chance for fear that it wouldn't pan out and I'd be screwed financially for a little bit. We have a small sum in the form of savings, but no debt (aside from our mortgage). I wouldn't need to make too much of an investment: a laptop and perhaps some specialized tools.
I am, however, concerned about a few things:
- Managing my finances. Maybe something like Quickbooks would help me in that aspect?
- Insurance. My wife's insurance is crap. My current insurance is pretty decent. I guess I would need to look into providing my own insurance, but I've never had to do that before.
- Formal training. I am completely self-taught. I've been working on and with computers for over 20 years. I know my way around pretty much everything relating to computers, but I don't have the piece of paper that says so. Ideally, I would like to get certifications, but I'm afraid people are looking for the paper regardless of whether or not I can prove I know what I'm doing.
I would appreciate any advice you guys care to provide. I'm sure I left a lot unanswered, so please ask questions.
Thanks in advance.
I am currently the sole IT person at my company. I wear many hats. I am a web developer, network and server admin, computer builder and fixer, and I go out and do any necessary programming for devices we sell and install.
Over the course of the many years I've worked here, I've frequently dealt with clients that either do not have, or do not need a full-time IT person. On countless occasions, I've been asked to help with some sort of computer or techie-related problem. If it wasn't too obscene a request, I've always tried my best to consult and help. Many times a client has commented that it would be nice to have me around to help when needed instead of using the 3rd party support service they currently use (and paying a sizable sum, to boot).
I have always wanted to work for myself and do consulting and/or IT work for companies who cannot afford to have an IT person on staff, and I've toyed with the idea for several years now.
My thought is to have each client pay a set amount each month to keep me on retainer (so to speak) and then pay a nominal hourly charge. As work is required, they would call me to schedule an appointment, at which time I would complete whatever task they have for me. I was thinking of having several (perhaps 3) different plans with different pricing. The higher the monthly charge, the less the hourly charge, with each plan including a set number of hours per month (before incurring any additional hourly fees).
My goal is to have a pricing structure that is low enough to entice customers to use me as their IT solution, thus guaranteeing me recurring monthly income.
As my talks have been with current clients, I have been very careful engage only in conversations that do not apply to work that I would normally perform with my current employer (e.g. we install product X, I would not perform any work on product X so as to not take money away from/burn bridges with my current employer). I believe there would be a significant amount of alternate work I could perform that wouldn't mean my stepping on any toes.
(Side note: several months ago I entertained an offer with another company, which ultimately did not pan out. Upon telling my current employers of my desire to leave, they actually suggested contracting me to do any necessary work they may need. I would actually like to find a way to have them be one of my clients, should I go through with this plan.)
With a wife and two kids, I'm scared to take a chance for fear that it wouldn't pan out and I'd be screwed financially for a little bit. We have a small sum in the form of savings, but no debt (aside from our mortgage). I wouldn't need to make too much of an investment: a laptop and perhaps some specialized tools.
I am, however, concerned about a few things:
- Managing my finances. Maybe something like Quickbooks would help me in that aspect?
- Insurance. My wife's insurance is crap. My current insurance is pretty decent. I guess I would need to look into providing my own insurance, but I've never had to do that before.
- Formal training. I am completely self-taught. I've been working on and with computers for over 20 years. I know my way around pretty much everything relating to computers, but I don't have the piece of paper that says so. Ideally, I would like to get certifications, but I'm afraid people are looking for the paper regardless of whether or not I can prove I know what I'm doing.
I would appreciate any advice you guys care to provide. I'm sure I left a lot unanswered, so please ask questions.
Thanks in advance.
$('#you').appendTo('#compton').css('color', 'white');
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2. Get a better job.
Are you prepared for the amount of bullshit negotiating hours with small businesses will require? What happens when they go over hours and say "no one authorized that" and refuse to pay?
I don't mean to shoot this down, but think very carefully about what may happen.
Also, beyond a laptop, if you're supporting companies, you'll need various dev subscriptions for system tools to be well-paid enough to make this work.
Do you really want to run your own business? If so, that's freaking awesome and you should do more research. But if you just want to make more money in a better environment doing IT, you shouldn't look to starting your own business.
As for the rest...
1) Do you know how much money your local competitors are charging?
Be very careful of low-balling yourself. Let's say your top local competitors are charging $100-150 per hour. You might be tempted to charge $90 per hour. Here's the problem with that: you will attract clients who are looking for bargains. Those bargain shoppers will have older, slower computers; cheaper printers; lower-end network devices. Those devices will burn up more of your time and those clients will try to fight you on your invoices.
Don't be the cheapest guy in town.
Even if you position yourself on the low end, make sure there's somebody cheaper than you.
2) "My thought is to have each client pay a set amount each month to keep me on retainer" - in the small business IT world, this is called "managed services" and it's where a lot of small business IT support companies are going. It beats the hell out of hourly billing, that's for sure. There are a lot of products specifically geared towards people in this business. Take a strong look at a service called Continuum - it's a server and network monitoring and remote control service specifically meant for outsourced tech support providers.
3) Insurance. You might want to look into getting on COBRA through your current employer. It'll be expensive, but it will keep you going for 18 months. A lot will change in the health insurance landscape in the next 18 months with all the healthcare reform laws kicking in.
4) Taxes. You'll be self-employed, which means you'll be withholding your own taxes. Your tax burden will also be much larger than you're used to. The silver lining is that you can deduct a lot of stuff - your computer, your auto expenses, your internet access, your medical insurance, even a home office may all be partially or wholly deductible. I suggest talking to a professional tax preparer.
5) Incorporation. Most small tech companies that I know of are LLCs. Shielding yourself from liability is important - let's say a client refuses to invest in a decent backup solution and loses all their data to a hard drive crash. Despite it not being your fault, they decide to sue you. Even if you're confident they can't win, knowing your personal assets are shielded from liability can be a big relief - not to mention save stress on your marriage.
Would be nice, but my current employer is cheap as hell. Also, I like the guy, so I'm not about to use him for free certs.
That's the point of the thread.
No, I'm fully aware that can happen. It happens in every company. I just (currently) don't deal with it because I'm not the boss.
Like what? Can you provide some examples, please?
$('#you').appendTo('#compton').css('color', 'white');Yeah, I'm fully aware of the downsides. I'm not expecting this to be easy.
Well, I believe I'm mature and organized enough to do it, but really, doesn't everyone? I'm not looking for someone to talk me into it, just as I'm not looking for someone to talk me out of it. I'm looking for the reality of the situation and then I can decide if I am able to handle it.... if that makes sense.
$('#you').appendTo('#compton').css('color', 'white');I fully intend on telling my current employer (I'd like to have them as a current client, too).
I have to do some further research on this. It's not easy to find out everyone's prices, for the most part, without being a (potential?) client.
As I mentioned, I come from a business that survives on recurring revenue. I need to be able to charge a monthly fee to be available for help should the need arise, so I can have guaranteed income. I will definitely take a look at Continuum. Thanks for the heads up.
I talked to our HR/Accountant today (don't worry, she won't spill the beans), and that's what she suggested too. I don't know the specifics of the whole Obamacare thing, but surely there's a way for a guy like me to get affordable insurance for my family, right?
This is some of the financial stuff that I need to brush up on. I presume that any of the accounting software out there would help me manage this, yes?
I've already looked into filing for an LLC in my state and gotten the requisite paperwork. It's just a matter of sending in the money at this point.
Thank you for your input. It is much appreciated.
$('#you').appendTo('#compton').css('color', 'white');And what industries are your potential customers in?
A couple of my potential clients are pharmacies. There's also an electric company, a couple of convenience stores, a hair salon, a general contractor, and a local metal plant.
$('#you').appendTo('#compton').css('color', 'white');With pharmacies, or any medical company dealing with personal health information, getting a basic healthcare IT certification from CompTIA is probably worth it. It's less than $200, the test isn't that hard, and it shows that you know the basics of HIPAA. http://certification.comptia.org/getCertified/certifications/hittech.aspx
The other thing to look into is the Microsoft Partner Network: https://mspartner.microsoft.com/en/us/Pages/index.aspx
Microsoft has multiple partner levels. Basic membership is free. For about $400 a year on top of that basic membership, you can subscribe to the Action Pack, which gives you free licenses of pretty much every Microsoft product applicable to small businesses to use internally. This lets you, for example, run your own Windows Exchange Server to play with. A subscription also gives you up to 10 free tech support incidents with Microsoft per year. This also opens up the possibility of becoming a Microsoft reseller (https://mspartner.microsoft.com/en/us/Pages/Licensing/reseller.aspx) which is can be a small but still decent source of extra revenue.
Getting an actual certification on your own doesn't benefit you immediately, but consider getting a certification in one of the basic Microsoft technologies. For instance, an MCSA for Windows Server 2012: (http://www.microsoft.com/learning/en/us/mcsa-windows-server-certification.aspx#fbid=Hz_pB6uJHQw) If you end up employing, partnering, or contracting with one other certified tech, that lets you bump up your Microsoft partnership to a silver level.
Other certifications depend on what products you're supporting. If you support a lot of Juniper firewalls, for instance, get a Juniper certification. Most tech companies end up as value-added resellers (VARs) for their favorite technologies. Like, I used to work for a company that was a VAR for Microsoft, Dell, Juniper firewalls, McAfee antivirus (blech, hated it), and Barracuda. I contract with a company right now who is a VAR for Microsoft, Dell, Sonicwall, and VIPRE. Sometimes, the certification and the reseller status go hand-in-hand... after all, the vendor wants to be confident that their resellers are knowledgeable in their products.
Take the number of computers in an organization, including servers and shared workstations.
Divide by 2.
That gives you a ballpark estimate of number of IT man-hours that organization needs per week to stay operational.
Yes, Virginia, that is per week. Not per month. Don't even go there. (You have no idea how many times people go, "You mean per month, right?" Hell no.)
A company with 36 users and 4 servers? That's 40 systems, so 20 hours per week. That's your starting ballpark. Don't take it as gospel, it's just a guideline.
Factors that can reduce the amount of tech support necessary:
- Smart investment in infrastructure. A company that pays for good computers and firewalls and antivirus subscriptions with extended warranties can get by on fewer hours.
- Lots of utilization of outsourced and cloud services. If they're using Google Apps or Office 365, that's a mail server you don't have to worry about.
- No industry-specific applications. All they use is email, Internet, and Microsoft Office? They can get by on less.
- Low-priority business services. A spa that uses their computers for booking can still do business if their computers are down for an hour. A pharmacy that gets electronic prescriptions transmitted in by doctors and does online insurance approvals can't.
Factors that can increase the amount of tech support necessary:
- They're providing technical services directly to their own customers or the public. I have clients that run their own web-based customer-facing business databases. Naturally, that completely skews the above formula. At that point, you really have to dig and find out exactly what the time burden of that public-facing or customer-facing application is.
- Old computers, old antivirus, old servers, cheap-ass business owners. Cheaping out on your IT never saves you money, it just shifts your investment from equipment to labor.
- High-priority business services. See above.
- Unusual industry-specific software without support contracts. You're going to learn a lot about mortgage software, tax preparation software, legal document management software. If a business has a support contract with the vendor, great! If not, somebody has to pick up the slack, and that somebody is going to be you.
Protip: Charge 50% of the quote upfront for projects. If they fail to deliver the other 50%, undo what you did.
Your target market should also include small companies WITH an IT department of 1 or 2 people who cant handle the workload they have and need outside help. You would come in with fresh eyes and new solutions to help, or just the labor they need to get through a difficult task.
Home Inspection and Wind Mitigation
http://www.FairWindInspections.com/
Yes, very much so. My advice would be to have an accountant set it all up properly and let them run your finances for a few months (send them bank statements.. you will need an account which is business only.. preferably set up in the business name once you file incorporation papers... accountant can do all of this)... then take it over from them and do it yourself.
- Insurance. My wife's insurance is crap. My current insurance is pretty decent. I guess I would need to look into providing my own insurance, but I've never had to do that before.
Most if not all insurance companies can give you single/personal plans which can be cheap depending on coverages... BUT the rumors are the prices will all be increasing dramatically with the new health care laws.
- Formal training. I am completely self-taught. I've been working on and with computers for over 20 years. I know my way around pretty much everything relating to computers, but I don't have the piece of paper that says so. Ideally, I would like to get certifications, but I'm afraid people are looking for the paper regardless of whether or not I can prove I know what I'm doing.
Doubtful. If you present yourself professionally and are talking directly to other business owners (see post above) they wont know or care to ask about any certifications. Experience is almost always better than certifications, unless they are knowledgeable about a specific problem they need fixed and it requires a specific certification they wont care. They will hire you based on you, if you complete the work for a reasonable price they are happy.
Home Inspection and Wind Mitigation
http://www.FairWindInspections.com/
Have a disaster plan as well. We have a friend who started a business, had a good plan, but about six months after opening he went in the hospital for two weeks with a perforated bowel. How are you going to deal with that - who are you going to call in, how are your customers going to react? Have you worked with a lawyer who write up your service contracts and be ready to address any lawsuits? Have you talked to the bank about getting a business loan?
What you are doing seems like it would be lower overhead than say a retail business or restaurant, but make sure you have clearly and honestly assessed your costs. What are you going to do if your laptop takes a shit on you? What about if your car shits out? Do you need to be on-site? If you are working from home, do you need to upgrade to a business class plan? Etc.
Realistically, I would recommend starting small with a few customers before you leave your job. Maybe the hair salon or something to help you get an idea what you are getting into, and the amounts of time you need to commit to get a given amount of income. Remember, you would never roll out a product without doing a UAT and pilot first, so get that straight ahead of time.
Your value proposition of "basic support" is easily served by anyone with a modicum of tech skills and a customer-first persona. This is easily replaceable and already served by a number of sources (other local computer shops, geek squad etc.). A MCSE, Cisco or networking person is not easily replaced. If you can offer the full small-biz suite with most of the effort in setup, you can do well.
Service, however, will bog you down, as simple dumb questions will eat your day like no other, and the first time someone is in a jam and you're helping someone else, you will be out the door. I don't say this as a cynic, but as a realist. Barring that, how do you expand your customer base? What's your total capacity? There's a reason every corp pushes towards self-service and Software as a Service is so popular - individual care is expensive (from a labor perspective) and hard when things are inconsistent, like hardware setups. Also, you have no opportunities for additional money, as the moment someone says "we're expanding, and need a mail server and network setup with backups", you're out of your element.
This is not saying it can't work, but you're discussing starting a business with no unique sell beyond a warm body to do basic tech support.
As for certs and the guy being cheap - he gets to write the costs off on his taxes.
One thing to try is to do it on the side for one biz and actually count how many hours a month it takes.
Oh, yeah, this. If you're not capable of at least setting up a small network and server on your own, don't even consider this.
You should be able to set up an Active Directory server, a file server, troubleshoot problems with DHCP and DNS, set up a basic site-to-site VPN between two offices using firewalls (Cisco, Juniper, Sonicwall, or similar), set up a basic remote access solution using Windows Routing and Remote Access or DirectAccess, and network printing and scanning.
I kind of assumed you had all those skills when you started the thread.
You can kind of get away with not setting up mail servers because of the proliferation of "cloud" based mail services (Google Apps and Office 365), but it helps if you have some experience with Exchange because there are still people out there with their own small Exchange servers (often running Windows Small Business Server).
Desktop support isn't going to get you very far at all. You have to be able to do networks and servers.
Example:
"We are adding an additional 20 servers to our service contract, we are just waiting for someone to install the fiber optics, and install an extra CRAC unit."
"We can pull and terminate the fiber for you, here is a quote, and we have a prefereed contractor who can do the HVAC for you as well, and we will service the HVAC, fiber and your servers, here is padded quote price." Now granted there is some know how that is associated with all of those, but doing it yourself, or having contractors you can call to do it at a reasonable price can make you a load of side money.
The companies you are talking about will likely look at that $500 pricetag and balk knowing they can train someone they already have to learn those skills for less than $500 a month. Keep in mind most small businesses can't afford a monthly fee for a CPA, much less tech support. Those companies that can afford it and are using the level of technology you are looking for either have folks that already know how to do the work to a certain degree as part of their box-of-hats, support from their franchise to use a shared office, or pay a service provider to handle it bundled (as with internet/cable/phone support for small businesses).
The business model might work in a very specific set of professions that you already have contacts with, but you are probably going to need to refine your business model a good deal and look to see how many folks in your area are already competing for those positions. If your current company is what got you the connections in the first place, I would not assume undercutting and going freelance will flip those contracts over to you, either.
It's doable, but very complicated. Do you have any accounting, advertising, or management experience?
— Robert Heinlein
$500 is small potatoes. Then there's the nominal charge of like $10 an hour I assume, just to keep people from using up all 720ish hours of a month to feel like they got their moneys worth calling for things like "oh my printer won't print... oh it's off, lol sorry this 15 minute call was free right?"
it's freeeeee