I just received another excellent email from Patrick McKenzie, and in it he tells one of my favourite stories. I never tire of hearing him repeat it because it perfectly exemplifies how people underestimate the value they are providing.
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Anyhow, after we got our coffee, Thomas invited me into their conference room. We talked shop for three hours: Thomas and his VP wanted to hear what I’d do to market their products and services offering. I had been writing about how I marketed Bingo Card Creator for a while, and started applying some of the lessons learned to their content creation strategy.
[…]
At the end of the conversation, Thomas said something which, no exaggeration, changed my life.
Thomas: Some food for thought: If this hadn’t been a coffee date, but rather a consulting engagement, I’d be writing you a check right now.
Me: Three hours at $100 an hour or whatever an intermediate programmer is worth would only be $300. Why worry about that?
Thomas: I got at least $15,000 of value out of this conversation.
You’ll notice that I immediately thought the proposed transaction was time-for-money, but Thomas (the savvy business owner) saw the same conversation as an exchange of business-results-for-money. He correctly anticipated that Matasano would be able to take that advice and turn it into a multiple of $15,000. (They did, within two weeks, but that isn’t my story to tell.)
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I highly recommend you go read the rest.