Is Moonlighting Cheating?

Hi, I'm Michael Hartman.

I'm Naomi Liu.

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In this podcast series, Grant Gregorian and I interviewed guests on their journeys as consultants. We discussed all that it means to be a great martech consultant from setting up their business or joining an agency and how to find new clients and keep their existing clients happy. I hope you enjoy the interview. Our guest is Tom Keefe, who is currently the Director of Marketing Operations at Engagio, recently acquired by Demandbase. Who is a full-time employee there, but also has experience in the consulting world. So thanks for joining us, Tom.

Yeah, thanks for having me, Courtney. Happy to be here.

Great. So Tom, you and Grant know each other from previous worlds, and Grant, thanks for doing the introduction and having Tom join us today. Mm-hmm.

Looking forward to it.

Absolutely. So Tom, tell us a little bit about your insight into the consulting world and experience with that in the past before you were in your current role.

Yeah. So, you know, I was doing some moonlighting back a couple of years ago, working full-time, and an opportunity came up to, you know, really start my first ever consulting gig. So I really hopped on it, uh, started my own LLC, you know, got the accountant, the tax person, everything set up on the background, uh, so I could go full force and do these types of work, you know, after hours and then kind of spending it on weekends. And it was a really eye-opening experience for a lot of different ways. And I think one of the really cool things about doing it was I was able to learn more about what I was able to accomplish and, you know, those skills around pricing, scope of work, you know, how am I going to promote myself and how do I set expectations for these customers, um, you know, that are really paying me for my time and my results versus just sitting in an office and getting things done for 40, 50, 60 hours a week. Um, it was really great and I'd love to explain, you know, what I learned and what are some of the things I would look out for going into another Consulting role.

Yeah, I'd love to hear it. But I also wanted to know, did you feel like you— so you said you were moonlighting. So whenever I've done that in the past and I felt like I was cheating on my girlfriend or something, did you— how did you— how did you tell me about the mind process? Were you feeling underpaid? Were you feeling bored on the weekends? Like, how does one go from I am a satisfied, engaged employee to I'm moonlighting in the same category of work that I do full-time, but I'm also doing it on the side. Walk me through that thought process.

Grant, you nailed it. You know, it does feel like you're cheating on your girlfriend a little bit. You know, if you really love your job, it's always a little weird to be doing something on the side. But from my perspective, you know, it was something that I knew I needed to get under my belt to really round out my experience because, you know, As a marketing ops person, you don't get a lot of customer-facing opportunities. You don't get a lot of opportunities outside of vendor purchases to talk pricing. And, you know, one of the biggest parts of MOPS or SOPs, any operations, is time management. So understanding that, okay, if I was going to do this, I needed to set the expectation that, you know, from 8 to 6, 8 to 5, Monday through Friday, I was unavailable. That is not a time where I'm going to take calls, hop on Zooms. All of my work is going to be done off hours and on weekends. And I thought that setting that precedent early on in the engagement was really helpful for me to lose that feeling of, you know, guilt and cheating and I'm doing something wrong. Because, you know, I wasn't working for a competitor. I wasn't, you know, in violation of any, you know, contract offer with my current employer. So just having that separation of my full-time world versus, you know, my moonlighting world was a really big help in terms of that.

That makes sense. And I mean, to be clear though, it technically was probably like— it's commonly against employee agreements. But I think that you're setting the boundary was like super valuable, you know, because oftentimes it's during office hours or during using like office computer or office time is when people kind of get in trouble for doing stuff like that. Or, you know, if it starts to take away from your full-time job. So then, yeah, you get these, you decide to want to do it. How did you get your first clients? And, and, you know, talk me through some of the things that you learned from doing that.

Yeah. So, you know, one of my first clients happened to be, you know, a former, uh, like it was a referral from someone I had worked with in the past, uh, that really enjoyed working with me. They had a gap in their operations, you know, uh, team. And they said, hey, we'd love for you to come in and, you know, start with an audit. And we'll tell you where we're trying to get to, and you can tell us kind of how much work's going to be involved, what you think we need to do, if there's gaps in the technology, if there's gaps in the sales process. So, you know, just the audit alone, I think by going around, by going that route and starting there versus, hey, I'd like you to achieve A through X, was really helpful again for me to understand, well, what is the scope of this?

Yeah.

And I'm sure, you know, people listening have always done like a trial of SaaS products or, you know, hey, what's happening to this Discovery call through a sales rep, and that's kind of how I treated the discovery. And I wanted to understand kind of okay, I want to jump into this. I want to do this work and get into this new consulting world. But how much of that time is really expected? So being able to jump in, get that access, and get the audit done at first was a very big help. And you know, I would recommend kind of working in a templatized world of like okay, this is the system. These are the important flows. These This is the tech that's involved. This tech is talking to that tech. Excuse me, here's some disconnected technologies that we can, excuse me, bring into the stack to aid their end goals. But the audit's only as useful if you know that end result, right? If we're trying to create a tracked people journey, if I do a general audit, I might not be looking for that type of thing. I might be looking at, okay, well, with all the data mixing and matching and tying together, versus now I can do an audit with a specific understanding of, okay, Are we tracking the buyer's journey of these prospects? Is it going into Outreach or Salesloft? Is it coming back to Salesforce? Is there an SLA around these things? So really having that objectively driven audit was very helpful. And, you know, to touch back on how did I get this opportunity and other opportunities, it's all been from word of mouth, to be completely honest. I've probably done 4 or 5 engagements now, and every single time it's, oh, I heard you did great work for A, B, and C. Oh, this person recommended you. So I actually don't even have— anything about my consulting on my LinkedIn profile. It's really just a word-of-mouth kind of side gig for me. And I think that's a really great way to go about it if you're doing it as a moonlighting side project, because you know that the people that are referring you, they know your skill set versus, hey, let's go batch and blast every marketing manager on the East Coast from LinkedIn. And maybe, you know, you run into someone that you don't mesh with, mess with, or they have different expectations from a consultant than what you're willing to give. So I really do think that the referral Well, I have a question for that, Tom.

So you're doing it freelance, but you're getting inbound traffic, you're getting referrals and positive experiences. Why not leap in and do it full-time and do it the 40 hours a week? What keeps you with one foot in the door of like the W-2 employee world? Yeah, I'm curious your thoughts on that.

Yeah, you know, it's kind of like cutting the cable box out of your house, right? We're all just so used to the ease of the W-2. And the benefits and the 401 and, you know, unlimited PTO and a free laptop. Um, you know, these are all things that just bring my stress level down, not knowing, you know, where that next paycheck's gonna come from on a weekly basis. And personally speaking, you know, we all have our own financial strategies, but my consulting is one of those things I look at as additional savings. And I think it's really good because I can set my own hours. I can take on as much work as I can at certain times.

Mm-hmm.

Mm-hmm.

And, you know, some customers have even asked, oh, would you be willing to, you know, work on a retainer where we just retain your services for a month or 2? And I think that's a really good way to go about it if you, you know, are looking to move away from the W-2, maybe having a couple of key clients versus constant, you know, churning engagements. I think for me though, I just like having multiple pieces of the pie, right? I like the work I do full-time, and then I like being able to jump industries in this consulting world, maybe working for a B2B business, a B2B business. I've actually worked with other consultants helping their customers, which has been an interesting piece because now it's like, okay, I'm gonna kind of take a step away from my solo view, my solo work habits, and actually work with an agency who's surfacing, you know, results and insights for their customers. So for me, I think it's really good to either— for me personally, I like doing both because I just like switching it up. But I think there's definitely something to be said for doing it full-time and on your your own, because, you know, if you don't want to work Monday, you don't have to work Monday. You can work Tuesday through Saturday, and no one's gonna yell at you if you're not on Slack. But again, that's, that's all expectations that you need to set, you know, right at the beginning of these engagements.

Yeah, absolutely. I definitely had that thought process in my last full-time role of, you know, if I could do nights and weekends and pick a couple— pick up a couple things, but I felt this loyalty and, you know, cheating factor. I like that analogy that you guys came up with. And so I, I kind of ripped off the band-aid and went into it full-time. But I also wanted to touch in on your talk about a retainer and pricing, 'cause that's really how I have kind of structured most of my business. I would say like 80 to 90% of my clients are project-based on a retainer. I'm considered an employee on their team a few days a week, 2 days a week to 4 days a week, depending on how much work there is. But then I've had a few people that really want that hourly rate. How much do you charge per hour to build webinar programs or something like that? So I'm curious, is your experience, Do you have any gotchas or big red flags to pay attention to as we consultants try to figure out the right pricing model?

Yeah, you know, I think— so when I first started this, one of the first things I did was I looked at what my salary was per hour, because I've actually never done that. It was like, oh, what is this divided by 2,080 hours? Okay, that's my hourly rate. That's great. You know, and this consulting work's not coming with benefits. It's not coming with all of the little perks that comes with a W-2 job. And then from there, I was looking at up- Upwork and different other like, you know, self-help consulting sites and seeing what people were charging. And, you know, I think setting the right price for yourself is a daunting task because you'll set a price and you'll say, well, wait, would I pay this? And, you know, you can talk yourself in and out of that price constantly. So my prices usually range around like $150 to $200 an hour. Um, and the reason, you know, it might sound very high, it's because I know that I can handle more than just your standard marketing ops technologies, right? If you have sales engagement technologies like a Salesloft or Outreach, if you have a CRM, right, if you have different types of marketing automation, I feel fully confident that my skills will apply to those, hence the higher rate. But, you know, if you set that high rate, you're not getting any work. Some people might think, well, maybe I should decrease and maybe I should sell myself a little short. And I honestly don't recommend that because if you think that you're worth a certain value and that your work will stand up and the integrity is there, you know, stand by your price, have that confidence in yourself to promote yourself at the rate which you see yourself being paid. So I think that's a big part for people when they're starting off. It's like, well, do I take, you know, $50 an hour or $80 an hour or $500 an hour? And honestly, every company is going to be a little bit different on how they want to spend that. And when it comes to retainer pricing, I think a lot of it is around the expectation, right? So I know that in the one time I've done this, our retainer-based system was, okay, we want you for 40 hours. So basically it comes out to 10 hours a week. Now, my big thing again, because I was full-time, was, okay, well, Monday through Friday, 8:00 AM to 6:00 PM, I'm unavailable. Like, I will see your emails, I will respond to them later when I'm not on company, you know, location and using a company laptop and making sure that I'm not affecting my full-time role. And I think, you know, when I do that retainer, my rate, I lowered it because I wasn't available all the time. Mm-hmm. But during the weekends, it was a 24/7, hey, you have something, we'll have it done. All the deliverables will be sent to you by, you know, 6 PM on Sunday, and then we'll work through the next week of deliverables. So maybe if you're available, you know, during the week, if you have more hours, um, to be flexible with, and it's not these set days and times, maybe your retainer goes up a little bit more because, you know, things can change and things can snowball after one question. Oh, well, now we need to fix A, B, and C. So that's gonna be a little bit more work.

Yeah.

Um, I personally prefer the hourly rate because with these operation-type jobs, What I've seen is, hey, I'm talking to the director of marketing, the director of sales operations. They want to achieve A, B, and C. Okay, great. Let's do the audit. Let's scope out the work. Here are the things that I believe need to happen. And, you know, no fault to anyone else. Sometimes the person hiring you doesn't know the full scope of the data architecture or the process that goes into that. So now to achieve your goal, you might actually have to bring in more people from their side. Right. There might be another layer to the complexity around maybe changing an AE or ADR habit or a demand gen manager's process that wasn't originally a part of your scope. And, you know, if you're doing retainer work or overall project-based pricing, you might lose out on that additional work that you discovered by trying to produce the best result for the, uh, for the client.

Yeah, that is definitely something I have experienced for sure. I personally don't like the hourly rate because there are certain things I know I can do really quickly because I've done them for 10 years, but they still have value. If I can do it in 30 minutes, there's still value of my QC process and methodologies that I've created for myself. So I do like the retainer kind of project-based, but as I have been tracking my hours on my own, sometimes I'm like, ooh, wow, I'm not really making what I should be. This one week I've put in 50 hours on a project. So I'm still kind of figuring that out and getting advice from other people on how to do that in the right way. Grant, what is your thought on the retainer hourly thing here?

Yeah. I mean, one of the biggest mistakes, I remember when I was first getting into consulting, I did the exact same thing you did, Tom. I took my salary, I divided it by 2,080, whatever number. I didn't even know how many business hours there were in a year. I had to Google that too. And it came out to like $35, I think, $35 an hour. And that's literally what I quoted to my first consulting client. I said, hey, $35 an hour. And I think they were like, okay, let's do it. And you very quickly learn that like, oh wait, I have to pay taxes on that. I have to pay, like basically everything that you essentially take for granted when you're full-time, you know, like you don't have any days off, you are not allowed to become sick, you, you have to do all this additional benefits, everything else. So whatever your hourly from salary is, you know, it's double it, or if not more, because you need to be able to at least have it enough to cover— like if you're expecting to be, to be getting paid as much as you are in a full-time role. But to your point, I think there is also the reverse of that. So for the client, there is kind of like the calculation of, oh well, maybe they're not available when I need them or on the weekend or whatever. But for yourself, there's also that risk level that you're taking on. Like you said, when you're going freelance, you may not have a gig, you know, until you get the next one. And so your rate needs to somewhat reflect that. Like I would say, give yourself more than you were making full-time because when you're full-time, It comes with like, I feel like the rate is lower because it comes with a kind of the security that you're going to be getting it. But when you're freelance, there is the added risk. So your rate should be slightly higher to cover for that. So that because if you then after this project, you know, can't find another project, you still need to be able to like feed yourself. Do you know what I mean? So you're right. It's like a really helpful exercise to go through in your own right, like as as a business owner to say, what is my price? What is the market rate? What is my risk level? What are my benefits? How much money do I wanna save? What's my opportunity cost of going mountain biking on the weekends? How much is that really worth to me? Is that a $1,000 bike ride I'm foregoing or what is that?

Well, and the retirement savings is one thing, the pre-tax savings that you can have when you're a W-2 employee, but the matching also is realizing, oh, I'm not getting, You know, a 401 match from my employer, and obviously the health insurance is a big one too. And I've been independent and got my own health insurance coverage. And Tom, it sounds like you have the benefit of employer-provided healthcare, which is great.

Yeah, yeah, that was a nice added bonus and a lot less stress taken off the consulting engagement not having to worry about that. But I do want to touch on one thing, you know, we keep talking about here, it's the tax piece of it, right? So I think that was a big learning curve for someone like me Because we all get the income tax, we understand what that is. But in the state of California, you have to pay taxes on the LLC. You have to pay state fees and franchise board fees and a lot of things that I was not expecting to pay.

Yes, I had the same thing. Yes, I even figured that the city of Portland wants to know how many hours you're actually working in the city. Because I don't live in the city, but I would go in and go to like a coworking space. And when I talked to my accountant, And he was like, well, how often do you go to that coworking space? How many hours for the last year? And ended up having to pay the city of Portland, I think, $200 last year. Yeah, I learned something new.

See, now the one thing I will say though is that, you know, if you have a spare room in your house and you turn that into your office, you know, now you kind of can work towards maybe some tax benefits, right? So while you are paying out for all these different pieces of government, you know, taking their cut in your work, you also can benefit by, hey, you know, I'm spending money on my business and now these become write-offs, which are way too complicated for someone like me, but my tax person says they're great. So I do think there's a nice balance between understanding what you should charge, what you need to save from each check for those taxes later, and then how can I spend money to improve my business and look at my home office. Now that might be a tax write-off because it's used purely for my consulting business and nothing else.

Yes, that was a very specific caveat my accountant said. If you do have that home office, it has to solely be used for that. It's not a space that you're also using for other things. He was very, very adamant about that.

As was I.

I think having an accountant and tax person that you trust, and mine is focused specifically on Oregon small businesses, which is something that's been really helpful. It sounds like you obviously have a California person to help you. Grant, are you doing it on your own or do you have professional help I just wing it, you guys.

And I do, I do research a lot, but I always think like, oh man, am I, am I missing something? Am I not? But I go through the questionnaires and I think every year I learn something new. I like to know the intricacies of it. So I like to do it myself. And the one, the one thing I remember when I first started that really hit me was this, there's this self-employment tax. We all pay it. I guess as a society, we're not really set up to encourage entrepreneurship, which is kind of crazy, but it's true. We have all sorts of penalties in the tax law and in life around insurance and everything else that really make it tough. So I think, Tom, your strategy of eating cake and whatever the expression is—

And ice cream.

And ice cream at the same time. I think you're onto something. I think that's a good way to be able to do it if you can manage it, if you have the time. And so kudos to you. Any other words for somebody who has a full-time role and is thinking about moonlighting? What else would you— any other parting thoughts or advice?

Yeah, you know, I think one of the biggest things I learned was really, you know, that scope of work is crucial. Setting the expectations. On early, not just in terms of your availability, your pricing, etc., but also what needs to be done to achieve those objectives. Because chances are you're going to need help on the client side as well, because you probably can't change a person's process, or maybe they're not giving you admin rights to tech, or you need access to other technologies that were not, you know, under their management. So really understanding what the objective is, what it will take to get there, and then trying to associate, you know, time spent or money component to that, I think, was something I'm still trying to really pull in the reins on and perfect. So don't feel bad if your first time you undervalue yourself or you overvalue yourself. Like, practice, practice makes perfect. And, you know, the more you try, the better you'll get at it. And I think the other thing too is, you know, step out of your comfort zone. You know, I've worked in tech, for tech companies for a while. And so my consulting roles have not been with tech companies, and it's been a nice change. And I've learned a couple of new things.

Mm-hmm.

And being a B2B marketer and working for a B2C company, It was eye-opening. I was like, oh wow, you do— your focus is totally different than ours. And I understand now why it is different versus just like, oh yeah, like B2C is just a totally different animal. It's like, no, now I have some experience in it. So while we're all kind of doing the consulting work, you know, to make a living and get that retirement built up, I do think it's a really good way to expand your experience and round out your circle as a, you know, Well, this is excellent.

Uh, thanks again, Tom, for taking the time to chat with us about your consulting experience, um, and, um, best of luck to you.

Yeah, thanks for having me, guys.

Thank you so much. Great to meet you, and take care.

Likewise, have a good one.

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