[HN Gopher] Ask HN: Where are all the software-contracting agents?
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Ask HN: Where are all the software-contracting agents?
A long time ago I worked as a software consultant/contractor in the
US, and I'm thinking of doing it again. I mostly enjoyed it but the
"find your next client" part was really stressful. Of course,
there's another big industry in which talent always has to find
projects and vice-versa, and that's the film (and television)
industry... in which there are Agents whose job it is to do that
matching for a 10% share of the deal. But when I look around I
don't see that happening in software. I know some people tried, but
I don't think it got anywhere. Instead I still see "consulting
companies" that have employees, and "independent contractors" that
have to constantly worry about their next gig. For people who want
to be independent contractors, but don't want to do the whole
networking-for-jobs thing, it seems like Hollywood-style agents
would be the perfect solution. Why isn't the software agent a
thing, even a dominant thing, in our industry?
Author : biztos
Score : 32 points
Date : 2021-11-19 17:40 UTC (5 hours ago)
| inetknght wrote:
| One of the biggest differences in your two examples would be the
| presence (or lack) of a union.
|
| Actors have a guild which acts as a union. Software engineers
| don't.
| biztos wrote:
| I've commented on that difference before, in a pro-union sense,
| but I don't see how it makes any difference to the role of
| agents.
|
| What about the presence/absence of a union affects the
| viability of agents?
| tgflynn wrote:
| That seems like a really good question. I highly doubt that skill
| at software development and skill at self-promotion are
| positively correlated. In fact I suspect they are likely to be
| negatively correlated.
| softwaredoug wrote:
| In the US look for small consulting companies with fast changing
| staffing needs.
|
| At my last job, we had a pool of trusted contractors we pulled in
| for gigs. Clients found our firm through our marketing efforts.
| We had employed consultants, but staffing needs shrink and grow
| all the time. When a new client wants 3-4 people parachuted in,
| we would want to help. So it was great to build relationships
| with trusted contractors.
|
| Much of the time these contractors had little interest in
| marketing and sales, but liked being contractors, so it
| essentially worked out like we were their agent. Almost always we
| kept them in steady risk and also took on much of the payment
| risk. (We always paid contractors on time even if the client was
| slow to pay us).
|
| I think this is a pretty common pattern especially on the smaller
| and niche ends of the consulting space. The huge consulting firms
| can just afford to have a huge bench all the time. But for small
| firms, that's not a luxury the company can afford.
| georgeecollins wrote:
| I have often hired a trusted / skilled person to do software
| contracting and they in turn subcontracted some or all of the
| work out to someone they worked with. That situation seems t
| arise naturally, where lots of people want to hire person X,
| and so person X starts to say, "I don't have the time myself
| but I know someone I can work with I trust."
|
| The skilled contractor can then handle excess demand when it
| exists. If I were looking for someone to be my "agent" the
| first place I would look would be successful individual
| contractors who are doing similar work. Many may need
| subcontractors.
|
| Also, star cintractors already have a lot of the qualities of
| agents, and more importantly qualities that would be hard to
| find in agents if they existed: domain expertise, connections,
| reputation, communication skills, understanding of the work.
| biztos wrote:
| Did your contract say anything about that?
|
| If I start a consulting company and want it to grow, then
| sooner or later I have to play the same game as the big
| players: Principals come and close the deal, Juniors do the
| actual work, billing reflects this.
|
| What I'm curious about for the agent model is someone who
| actually proposes to do the work, and does it. In that case,
| popularity raises the rate instead of dividing the time.
| Having Brad Pitt act in your movie costs more.
|
| If you really are an independent "IC" and are a "star" then
| you will have offers you want to turn down, right? And
| dealing with that will be a drag too, right?
|
| Hollywood Stars still use agents last I checked.
| biztos wrote:
| Yeah I agree that this is the closest thing to an agent model
| that I've seen reliably work in the software world, but in a
| way it's also close to the "packaging" thing/problem in the
| film world. I worked for someone doing it about 20 years ago,
| in the end he wasn't very good at it but it seemed like a
| viable business model, it got me into a lovely gig that lasted
| a couple years.
|
| The thing is, how does the talent find you? Or are you small
| enough that your existing network is enough?
|
| And are you pocketing a percentage of their rate, or
| negotiating their rate and the client rate independently?
| Meaning, is it in your direct financial interest for the
| parachutists to make more money, or only in the sense that you
| want them to work with you again in the future?
|
| Good advice about watching turnover in job offers, thanks.
| holonomically wrote:
| Because being an agent in the movie industry is about finding
| "talent" and being connected to the right producers. Discovering
| talent for film, just like in modeling and sports, isn't hard.
| You go to a few plays and theater productions or hang around
| enough people and notice which ones seem to have a knack for
| grabbing attention. This is hard in software because software
| talent isn't visible. Similarly, being connected in software
| isn't as relevant as in the movie industry because when software
| companies hire engineers they want to retain them for as long as
| possible instead of working on a single project and then putting
| a whole new team together for another one.
|
| In short, the dynamics in software engineering are stacked
| against this being viable. The incentives that exist in the movie
| industry don't exist in software so copying the movie business
| model and expecting it to work the same in the software industry
| is a non-starter. There are probably a few more concrete reasons
| but those are the main differences I could think of off the top
| of my head.
| biztos wrote:
| One of my best friends owns a modeling agency specializing in
| new talent. As far as I can see, it's very hard work to find
| modeling talent, which I (stupidly?) think is not even "talent"
| in the same way that actors, writers, squash-players and
| programmers are. Also, it's a very very feast-or-famine
| business and the agency is taking most of the financial risk.
|
| For the Hollywood case, I agree that my analogy weakens a lot
| when we consider all the people writing code for 10 years at a
| crack.
|
| However my anecdata (basically, watching what jobs different
| friends have gotten) suggests that connections in software are
| at least as important as anywhere else for the top end, it's
| just that there's a vast middle that pays pretty well and
| doesn't actually care whom you know.
|
| I read somewhere that Netflix says "we're not a family, we're a
| sports team," which I find quite interesting (and enticing!)
| but also seems to be an analogy in search of an agent?
| victoro wrote:
| In my younger years I spent some time working in the film
| industry as a PA and reading everything I could to learn about
| the business side of things. Needless to say, after becoming a
| programmer, I have often asked myself the same question.
|
| The main difference I can think of is that unlike films, which
| are discreet projects with hard beginning and end dates, software
| projects never really end. Maintenance can go on indefinitely and
| usually the most knowledgeable people to do that maintenance are
| the people that built the project in the first place. That makes
| some proportion of people likely to stay with a project for a
| longer time than it takes to just code up the requirements and
| generally makes turnover cycles less predictable than they are
| for people working on films. With less predictable turnover,
| agents (who generally make money at the time a transaction
| completes rather than continuously) would have less predictable
| income streams so they are less incentivized to do it. Also, even
| in movies, from what I saw, outside of top talent who command
| large contracts, all the other folks didn't seem to have agents.
| Thats probably because the transaction amounts for a given
| contract don't make sense for either party to participate. All
| the grips, electrical people, PAs, costuming, craft services etc
| workers were finding work just as a software contractor might --
| through connections from friends, colleagues, and people they
| worked with on previous projects. Many are also part of unions
| for their respective part of the business so I would expect they
| get some assistance in finding projects from that as well (e.g.
| if there is a union production in town they are usually required
| to hire only people part of the various unions -- so if you're
| one of the only union members in a region you could get work that
| way).
|
| I don't think agents are totally incompatible with the software
| industry, but I do think it would take a somewhat rare
| combination of highly paid project with a discreet, somewhat
| consistent term of employment (maybe coding up financial some
| kind of financial model or data pipeline for a hedge fund would
| fall under this?) to make it worthwhile for agents to specialize
| in.
| biztos wrote:
| Thanks, that's helpful. I did consider that the grips et al
| don't have agents, but the few actors I know in LA -- modestly
| successful people you would probably not have heard of -- all
| have agents.
|
| My understanding is that the agent makes 10% of everything you
| get, because most agent contracts are exclusive. Agent puts me
| on Dune 2, agent gets 10% of my pay; I get on Dune 3 because
| they loved me so much in Dune 2, agent still gets 10% because
| our contract says she does, unless I fire her in time, which
| carries reputational risk.
|
| I wonder, do people have agents on soap operas, which are
| probably the closest analogy to corporate software, i.e.
| projects that go on potentially forever and have some people
| spending their entire careers working on them?
|
| (I had a neighbor who was a soap producer, but not in the US,
| so not a good source of info for this.)
| victoro wrote:
| I like the soap opera analogy -- hadn't thought of that. But
| keep in mind that actors (and other folks that work in long-
| running shows) will still take other jobs as at the same time
| as their main gig -- e.g taking a part in a movie in between
| seasons. That sometimes happens with programming contractors
| as well, but from what I've seen its far more rare.
|
| Ultimately I agree with the other responder that Hollywood
| agents are better thought of as deal makers/negotiators than
| job finders so maybe what limits it from showing up in the
| software contracting world (and other parts of the film
| world) is that contract terms are much more standardized so
| not as much time is needed for negotiation and thus the
| programmers can do it themselves.
| biztos wrote:
| > contract terms are much more standardized
|
| Yeah but I wonder, how much of this is because we (as a
| group/subculture) are terrible at negotiating and don't
| have agents helping us with it?
|
| I mean, I have to actually work with the people and do the
| job, so in addition to being bad at contract negotiation
| I'm also factoring in a bunch of stuff that's orthogonal to
| the paycheck. Whereas the agent is negotiating for a
| number, of which she gets 10%, and short of making enemies
| that's the only consideration.
| TigeriusKirk wrote:
| You'd still want an agent even on a soap opera job, just so
| you'd have someone to handle negotiations when it's time to
| re-up on the contract.
|
| Hollywood agents are really more deal makers than job
| finders. You still do most of the work finding your next job,
| they do the work of negotiating the deal.
| abstracted wrote:
| Try https://www.turing.com/ I heard that they have some good
| opportunities.
| biztos wrote:
| Thank you, but I didn't Ask HN for a job, I Asked HN for
| opinions on why the agent model isn't common in our industry.
| abstracted wrote:
| I am sorry, my bad, I misunderstood that you are looking for
| your next gig. Here is my take, 1. Contract work varies very
| widely from say few weeks to years. Agent model won't scale
| here because you as a contract employee can get fired for
| numerous reasons, and which is pretty common in the industry.
| If an agent has to make commission, long term reliability is
| a must. 2. Continuous cut for the duration of the project
| with the contract employees keeps cash flowing for these
| consulting companies. Why risk the cash flow when you can
| earn bi-weekly :)
| biztos wrote:
| I _guess_ you can get fired, but isn 't that a
| differentiator for the agents? Like: Agent Amy has awesome
| people who don't get fired, Agent Bob has so-so people who
| get fired sometimes, and thus if you want Amy to be your
| agent you have to convince her of your quality. Juniors get
| Bob, and that's OK, after a while maybe they get Amy if
| they're really good.
|
| > 2. Continuous cut for the duration of the project
|
| This is also how the film/TV agent model works. My agent
| would get 10% of any business initiated when I am
| contracted to them.
| v1l wrote:
| hmm, account created 15 mins ago to post this.
| biztos wrote:
| But they only hire the top 1%, easily trumping Toptal's top
| 3%!
| v1l wrote:
| Who wants to build something that hires only the top 0.1%??
| abstracted wrote:
| haha, I can see how it came across, no ties with turing.com,
| I interviewed with them recently. I have been a daily user of
| hacker news for the last decade, never contributed anything
| on hacker news. I misunderstood that the OP was looking for a
| gig, and tried to help. In my head, I was thinking what
| better way to contribute to the discussion than helping
| someone find a job :D
| gregjor wrote:
| 10x Management does this. They have represented me and a few
| hundred other software/technology professionals for a while now.
| I have heard about other agents with a similar business model but
| I can't name them offhand.
|
| See the 2013 article in _The New Yorker_ that describes the 10X
| Management model.
|
| https://www.newyorker.com/magazine/2014/11/24/programmers-pr...
|
| Also written up in many other places. The founders frequently
| show up on Bloomberg News.
|
| Pre-10X I worked with a few skilled recruiters who acted more
| like agents (working on my behalf) than the majority of
| recruiters. They're out there but hard to find; a lot of tech
| recruiters don't take the time to understand the jobs or
| candidates and make a good match, but some do.
| biztos wrote:
| Thanks, that's one example for sure, hope they are still doing
| it.
|
| Before posting this I read a previous HN article about 10x and
| their "negotiation as a service" offering, and in that thread
| it seemed like indeed they were in the agent business, but hard
| to get as your agent. Which makes sense of course if they're
| good at it.
|
| But again I wonder -- if the business model is good, why don't
| we see more of it? Could it be that the people who make good
| agents are making better money doing something else, on
| average?
| gregjor wrote:
| Yes, they are still doing it. You can visit their web site
| 10xmanagement.com to see for yourself. They still represent
| me. The same founders have a parallel company 10X Ascend
| built specifically around negotiating for full-time jobs, not
| the same as the full agent model.
|
| I don't really know how hard it is to get taken on by 10X.
| The process wasn't particularly hard for me (in 2013). I know
| they have a fairly long backlog of applications. I know they
| prefer people with significant experience and specialized or
| in-demand skills who already know how to work independently
| with customers.
|
| Agents will of course specialize in fields they understand,
| and an agent can only credibly represent a small number of
| clients. I imagine the agent model doesn't scale as easily as
| recruitment or "body shop" consulting companies, because it's
| more personal and tailored than a numbers game.
|
| Like I wrote I have heard of other agents in the software
| field, but I only have direct experience with 10X Management.
| I found out about them from a magazine article.
| Tade0 wrote:
| I have a guy who I originally told to get back to me in a year.
| He did and has been doing this ever since. I got into one gig
| through him and stayed there about 10 months.
|
| I just got my annual call the other week, but had to refuse
| because I'm not planning on switching yet, but we'll be in touch.
|
| Several times recruiters who I told the same got back to me after
| a set period. Does this count?
| biztos wrote:
| I don't know. I also have some recruiters who respect my "not
| now, ask again in 6 months" reply, but for actual job-jobs.
|
| Does your guy call you when he has a _gig_ for you or is he
| trying to get you to take a full-time position?
| beaconstudios wrote:
| Isn't that the point of companies like Toptal?
| biztos wrote:
| Maybe I'm missing something about how Toptal works?
|
| It looks to me like they bill the hiring company $X and pay the
| talent $Y, but the relationship with the company belongs to
| Toptal and the difference between $X and $Y is their (probably
| leaky) secret.
|
| So looking past their 3% marketing spiel ("Google only hires
| the best engineers!") yes, they have a value proposition of
| reducing your gig-seeking anxiety, but no, they aren't _your_
| advocate the way an agent is (supposed to be). I 'm not saying
| that's an unreasonable value proposition, but it's not what an
| agent does for, say, a television writer.
|
| Is that not how TopTal works?
| beaconstudios wrote:
| True, I believe they remain a middleman in the transaction.
| Does an agent not do that? They take a percentage fee, after
| all. Presumably once the contract is negotiated you work
| directly with the end client just like an actor would.
| biztos wrote:
| I believe the agent's 10% is contractually guaranteed and
| you deal with them whenever there's a contract to
| negotiate, but after that you just have to pay them.
|
| The point is that if I have an agent, I have a relationship
| with my client _and_ a relationship with my agent, both
| contractual and also reputational. But the agent doesn 't
| have a contract with my client.
| tixocloud wrote:
| Would this be fairly similar to what a recruiting agency
| would do?
| biztos wrote:
| As I understand it, no.
|
| An agent, in the film-world sense, traditionally gets a
| cut of all your work while you are contracted with that
| agent, and -- crucially -- gets it from _you._ There is a
| contract, you 're going to gross $X, you owe agent 0.1 x
| $X.
|
| "All your work" because otherwise it would be too easy to
| make a deal with the producer, and cut out the agent. The
| risk on the other side is that the agent might not
| actually do anything to earn the 10%. You usually don't
| end up keeping your first agent if you are successful.
|
| A recruiting agency gets paid on a totally different
| model, usually a multiplier of the recruited person's
| salary, sometimes tied to them staying with the company a
| certain amount of time. The recruiter's business
| relationship is with the hiring company; the agent's is
| with you.
|
| So for example, for a $100,000 per year regular job, the
| company might pay the recruiter $30,000 after hiring you,
| possibly subject to your not quitting or being fired in
| the first three months. They are only very loosely
| incentivized to get you a better deal, if at all: maybe
| the company offers them a fixed fee, maybe they can fill
| the position with someone else, etc. So in a way it's
| closer to the moral hazard of real-estate agents.
|
| A "proper agent" the way I'm thinking of it, for a
| $100,000 gig they are going to get $10,000, and if they
| can get you a $300,000 gig they will get $30,000. But
| their contract is with _you_ -- and they get their 10% of
| your gross from every check, if the gig goes longer they
| get more money.
|
| The incentives are quite different. In an ideal world, I
| would have an agent find me my jobs and negotiate my
| rate, because they are going to fight to get 10% of a
| bigger number, and me being happy and thus working more
| actually makes them more money. Whereas for the
| recruiting agency, once they get their payout they have
| little interest in my further success.
| browningstreet wrote:
| Small consulting companies will have sales/biz-dev role, which I
| think works in place of this kind of thing.
| biztos wrote:
| Yes but in that situation I'm no longer Leo DiCaprio, actor;
| I'm Appian Way Productions[0].
|
| For me the missing piece (hence the question) is people doing
| that sales/biz-dev work and taking their cut, on behalf of
| people who would prefer to be independent and just do the
| projects, not build a consulting company.
|
| Of course I'm assuming there are a lot of people like that, but
| as someone else commented, self-promotion skills and tech
| skills are not strongly correlated, might even be negatively
| correlated.
|
| I've _hired_ contractors who would never ever be able to be
| anybody 's boss anywhere, but they were really good
| programmers. Those people aren't going to get very far by
| making companies, but a good agent could probably get them a
| lot more money.
|
| [0]: https://en.wikipedia.org/wiki/Appian_Way_Productions
| biztos wrote:
| PS, I'm aware of the moral hazard in the agent model, which
| already was on HN a while back[0], but then why isn't this our
| problem instead of the "BYO connections" problem?
|
| [0]: https://news.ycombinator.com/item?id=19570735
| throw8932894 wrote:
| I have opposite problem. Too many unrelated job offers with low
| salary, irrelevant tech stack or high tech debt. I hired
| secretary to do initial filtering. Final negotiation is always on
| you.
| biztos wrote:
| Anybody can get crap offers, the point of the agent is to get
| you good offers, because otherwise the agent doesn't get paid.
| My understanding of the system is that the final negotiation is
| on you in the film business too, but your agent is supposed to
| (be motivated to) help.
|
| Has the secretary made a significant difference?
| throw8932894 wrote:
| I get 1 goof offers out of 50 weekly. Secretary filters that,
| makes first contact, arranges details.... Money well spend.
| bryanrasmussen wrote:
| In Europe it's a thing, at least where I am, plenty of companies
| that just set up an independent contractor with a company that
| makes such and takes a 30-50 dollar fee per hour invoiced.
| PaulHoule wrote:
| 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!
| bryanrasmussen wrote:
| 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.
| biztos wrote:
| 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.
| biztos wrote:
| That's interesting, how do the contractors and the agency find
| each other?
|
| I'm loosely based in Berlin but there it seems like an even
| more "BYO Connections" arrangement than in the US, at least if
| you want to make real money.
| bryanrasmussen wrote:
| well there are a number of agencies around, some are rather
| local to the area, some small international (focused on a few
| countries), some I have worked with basically just called me
| like a recruiter - which is all they do - they try to recruit
| you and sell you for time limited projects.
|
| At the beginning I tell them right up how much I want which
| the rule I was told starting out is you should earn at least
| two times as much consulting as you do in permanent
| employment otherwise it isn't worth the extra risk.
|
| A recruiter's job naturally depends on being able to have
| good employees for their clients, but (this part is my
| assumption based on observing how they work) the ones dealing
| with consultants have this pressure to a greater deal because
| there is a higher turnover, medium and large companies hire
| consultants and sometimes might have a dozen at a time come
| in on something big, the purpose of the company is to
| minimize how long they need the consultant so they estimate
| how long they need them for and make a contract based on that
| - so for example I worked at a large media company for 2
| years paying $100 an hour and VAT on top of that - but the
| first contract (IIRC) was for 3 months, renewed for 3 months,
| and then they started asking me for 6 month contracts.
|
| When a company hires for 3 months and renews for 3 months and
| then wants you for 6 months more but you happen to get an
| offer that sounds more attractive right at that point ( maybe
| you get a job for half the hours per day but you manage to
| negotiate $160 an hour and you would rather take it easy at
| almost the same rate - as happened to me recently) then the
| recruiter gets an opportunity to bring in more of their
| consultants, so big companies long projects lots of
| consultants - more turnover for recruiters closer working
| relationship with company more need to give them consultants
| they are happy with because otherwise suddenly that well
| dries up.
|
| so what I'm saying is that you get a good working
| relationship with the recruiter because you came through for
| company A and company B then when company C rolls around they
| are going to try to really sell you there.
|
| Of course a bit after your contract with company A is over,
| if you maintain connections there you can connect with them
| and get a higher rate than the recruiter can give you while
| also working cheaper for the company, although often these
| companies prefer to work with a recruiter so they know the
| paperwork is all in order etc.
|
| I think it does work like the agency model, but not agents
| for superstars - more like agents for the working rank and
| file actors.
| biztos wrote:
| Thanks, that's very informative. Yes I am wondering about
| the rank and file actors/programmers, if there are only
| agents for the stars then it's not much of a system.
|
| In situations like this do you have insight into the actual
| billing rate?
|
| In my previous contracting work I always knew how much they
| were making on top of my work, but if I were a consulting
| company I'd probably take some pains to prevent the
| subcontractors knowing such stuff, just because of the risk
| of them cutting me out.
|
| Whereas, in the classic agent model, more pay for you is
| more pay for them.
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