|
Getting your Trinity Audio player ready...
|
Every founder knows a service goes stale in about two years. The quiet confession is that the same cash flow keeping the lights on is exactly what stops you from building what comes next.
In a member strategy session, the room was walked through a hard rule about how services age. A service launches, solves a fresh problem, and sells well for about two years. Then competitors pile in, fees compress, and the work moves into cheaper hands. The only defense is to keep launching capabilities the competition does not have, with a rough target of a quarter of revenue each year coming from services less than a year old.
Then one founder said the quiet part out loud. Their firm runs on two-to-five-year client relationships, not one-off projects. To build the next capability, they would have to pull their most capable people off billable work. But at their size, cash flow depends on those same people staying fully booked.
“It becomes this really complicated game of 3D chess.”
So the people best equipped to build the future are the ones the firm can least afford to free up. Busy, profitable, and slowly aging out, all at once.
Why it matters to you
A firm resting entirely on services it built two years ago is sliding down the commoditization curve, whether or not the P&L shows it yet. That slide is a slow leak on both margin and enterprise value, because buyers pay for durable, renewing demand, not for a book of work that is quietly aging out. The reallocation trap is how good firms miss it. They stay fully booked, feel busy and profitable, and never free the capacity to build what protects the next five years.
Your one thing
Look at your revenue mix. What share came from services you launched in the last 12 months? If the honest answer is close to zero, which one person would you need to free from billable work to change that, and what is actually stopping you?
Collective 54 is where boutique service firm founders go to make more money, scale with less friction, and build a firm worth buying.
See if it’s a fit →