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I worked for a while at web design/software dev shops that had a business model of "we charge $200 an hour to the client and pay somebody $70 an hour to do the work." It's not as bad a grift as it sounds because the firm adds project management, tends to give some rework for free, and have to pay for sales and marketing out of it. (Some of the the project management is a real addition, but some is garbling of communications like the "telephone" game. If you could eliminate that and some principal-agent problems they wouldn't have to do so much rework!)

I've done that both as a regular employee and as a consultant. Is that what you're talking about?

I've done other consulting jobs that were much better paid and specialized, things that very people could or would do. I'd like to have an agent for that!



no, the companies that find me contracts tend to have connections with other companies, I contract through them and invoice them a little over $100 an hour and they charge those other companies what I charge plus maybe 30 more an hour. Sometimes they make more off of me per hour, sometimes in order to sell me to the other companies they take a cut. Sometimes they take a cut to make the sale, sometimes I take a cut, sometimes I demand more.


I'm talking about the last part mostly.

But yeah, the "bill $200 pay $70" seems to be the thing we have instead of a real agent model? Because an agent model would be, "pay $X and take 10% of it" and so the agent's interest is aligned with yours at least in a simple way.

In your example, if they can charge $300 are they going to pay you $170? I doubt it.




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