1

I have noticed there is quite a lot of background talk on Spiceworks about people who have run their own small IT business. I feel it would be helpful for those who are looking to start their own business or who are already running a business to have a place to share their experiences and ask questions.

Do you have a small IT business?
Do you want to start a small IT business?
Post and chat about it below.

24 Spice ups
2

Got one. Always wanted one.

I’ve been doing it now for just over a year.

One of the hardest and most challenging things I have ever done. But I really enjoy it.

1 Spice up
3

I used to do IT on the side for people but it became too much work and liability. I stopped. Kudos to those of you that do it.

1 Spice up
4

I’m moonlighting, want to eventually start one up but it just isn’t in my budget / appropriate for my life situation just yet.

2 Spice ups
5

I have a small consulting company. I started it when I lost a job. So far it has been good. I got a full time job shortly after starting the company (in 2010). It has still been really good for additional income.

6

This is where I am at too.

3 Spice ups
7

What are some basic pointers you would give out to people starting or running one right now? Mistakes you made that others could avoid?

I have heard many talk about the liability issue. What sort of troubles did you encounter?

1 Spice up
8

I do not run or own my own IT shop.

I have two conflicting IT dreams. The first is to run my own shop with my own clients in a way that will make business easier for those SMEs that are my clients… a “Let me worry about IT and you worry about your business.” type of shop.

The second dream I have is to work in an enterprise scale (talking fortune 100 type businesses). This would be an amazing way to learn new skills and see how a business of that size operates.

This is an excellent idea, I am looking forward to what other people say on the matter.

3 Spice ups
9

This is an excellent idea, I am looking forward to what other people say on the matter.

I give credit to RAM for suggesting that one get made.

I have noticed many have an LLC associated with their name. Is an LLC definitely the way to go?

1 Spice up
10

I opened my one and closed up a few months later. : (

Still need to do the $0.00 income tax report for it.

11

Unless you are ready for a fight of your life and willing to make less money and pay higher taxes and work more than 60 hours a week, don’t do it. Competition is insane and people are always willing to undercut you. Also most clients are to cheap. Its hard to find a good client but they are out there. Remember your competition isn’t just other companies. Its everyone. From people moonlighting, employee’s or bosses kids that are “computer wiz’s”, to “Bob’s computer repair” shops.

You have to have a way to prove you are separate from them. More importantly you need to prove that to your prospective clients. As far as they are concerned you are all the same.

This has to be something you really need to love in order to do.

As far as liability, get insurance, at minimum $1mil of coverage. Also incorporate or LLC to protect yourself. All it takes is one good law suite and you lose everything house, car, everything.

Not trying to scare anyone, just want to make sure you understand the reality.

9 Spice ups
12

That’s my situation also. I would love to start my own business but I don’t want to do that until I have enough clients to provide full-time work for me. Also, I would much prefer to be done with college first. I’m definitely going to be following this thread to pick up any tips on starting up though.

3 Spice ups
13

I’ve wanted to start a small business as a Web Game Development Company, unfortunately I don’t really know enough people in the industry to come along-side as partners to assist in UI/Graphics, additional programmers, in order to make it really work.

14

the issue is with people not taking care of their systems and systems being so cheap these days. I’m expensive, or should I say I value my time but if you are paying “going rate for someone that knows what they are doing” per hour, which is way cheaper than my Enterprise consulting rate, how many hours can you be into a system before it just doesn’t make sense to repair it? The liability issue I had was usually one problem, with home or small biz pcs, are compounds of another problem. You fix one thing and another issue rears it head. You are the last person to touch it so I got tired of the arguments. Oh that virus destroyed your data. well I got rid of the virus and now you see that your data is gone, oh that is my fault because I got rid of the virus? no the data was damaged before you just couldn’t boot your system to see that it was gone.

I had one guy with windows 31 b.c. on this computers and wanted the world, I tried to do it all, took hours. his super old computer’s front USB drive (I am assuming was a home built pc by some neighbor that threw it together because he saw the movie hackers and didn’t connect the front USB correctly, Although how hard is that really?) shorted my good flash drive and rendered it useless. Oh by the way can you add this UPS while you’re here. Sure that should be easy. OH, now I see that there are 4 billion cords braided into a Gordian knot behind a 3,000 pound hutch that I can’t move and the only way to reach anything is to roll around and flop like a fish while trying to summon your inner mr fantastic just enough to reach that plug that is causing everything to be hung. no thanks. At least in a medium company that is an expectancy of standardization of some sort. Note I said expectancy. I walk in and say, nope I won’t deal with replacing that switch until that birds nest gets resolved. in home use the problems are better hidden.

Also i’m too nice of a guy. I was here for 17 hours fixing your computer that you bought for $1.29 cash and a half used olive garden gift card. your bill will be $1360? I couldn’t do that to somebody. ok just drop me a hundo and we will call it even.

4 Spice ups
15

I’m with Kimberlin. I ran my own for about 3-4 years but quit. I dealt mainly with real estate agents, attorneys, etc. Small shops with deep pockets. However, the headaches, unreasonable demands by customers, liability issues, sleepless nights, and low pay weren’t worth doing it anymore. They may have had deep pockets, but they had short arms and loud voices.

As your own boss, expect the government to take about 50% of your income off the top. IMHO, an LLC is the best way to go. There’s no tax benefits with an LLC but you do limit your personal liability and there’s far less paperwork to file and keep up with than an S-Corp or a C-Corp.

5 Spice ups
16

As Ritvir said - I started a small business in 2010 after moving across to the States - worked most weeks over 80 hours (including travel time). Clients are most definitely cheap, yet expect everything to be done in a 5 minute window - plus you have them hovering while you are trying to determine what stupid things they’ve done this time.

Insurance, minimum of 1mil - anything below definitely not a good idea. Make sure you have all your required licences - business licence, electronic repair license, entering peoples houses license etc etc etc.

Advertising - make sure you budget for this - at the time I started my company, I did an insert in a local paper (covering the Morongo Valley), Followed it up with Radio adverts (attached it to a local lost pets/found pets slot).

Word of mouth is the best advert, but without starting with some of the above, getting that word of mouth is difficult.

Pricing - make sure a: You make money and b: you are competitive with your competition. Do not go too low, or too high - for some reason, being to low makes the clients nervous.

Keep every single receipt for tax time - make sure you record your actual mileage for travel.

Cant think of anything else right now off the top of my head, sure there’s a bit I’m missing, but you get the idea I hope.

G (Closed my business after 2.5 years due to not having the time to commit to my clients - never made big money, but made enough to help us get by before finding this role)

2 Spice ups
17

Something I have heard repeated a lot is:

  1. Try to never do home user type work. The pay is just not there.

  2. Try to get good clients and keep them.

  3. Don’t need to advertise, let your work speak for itself. Word of mouth is very powerful.

  4. Don’t be known as the cheapest.

  5. Know when to hold’em, know when the fold’em.

5 Spice ups
18

Yes yes and yes.

Keep in mind you better have a savings that will last you a good year because word of mouth is the slowest form of advertising. However it requires no budget and can get you clients.

Getting clients is hard. Getting good clients is VERY hard.

Be ready to be a sales person full time. Constantly following up with leads, calling people, etc, etc, etc. Thats the only way to really make it.

3 Spice ups
19

I do some IT on the side, but I do have a photography business that I do in addition to my full time IT position. I would expect IT consulting to be similar, in that 80% of my work is administrative/sales, and 20% is actually taking photos/editing photos. If you’re just in it for doing IT work and not in it for business management, get out before you start unless you can afford to hire a sales and admin person so that you can focus on doing the actual work.

Definitely figure out your target market and try to stay away from home users, unless of course that’s what you want to do. A good niche I think would be small businesses with at least 1 IT person on staff. You’ll have your best luck as a consultant I think starting there because you’re least likely to be hassled and would be doing higher-level project type work. I would anticipate small offices - doctors offices, really small businesses, etc. being more headaches that it’s worth in terms of support. But if you can secure really good clients in those types of offices, than it wouldn’t be all that bad either.

20

I tried to partner with someone a about 7 years ago. We came up with a good name, business plan, and started out with a good client base. My problem is I absolutely hate doing sales. Afer the our MSP fizzled out. I joined two other MSPs to learn the ropes a little better. After working with two MSPs, I decided it wasn’t for me. A good friend of mine became more of a used car salesman that only pushed certain vendors because of the partnerships and kickbacks. He started to lose his IT edge because he concentrated on just getting sales for the products he was pushing. Its really hard to find an MSP that is really good to work with. The one we use now is great, but I have found that many times they try to push Cisco software and products we dont need because they are a Cisco partner and never offer an alternative to us. We have to go out and find an alternative ourselves.

2 Spice ups