NYC 18-person consulting LLC. Bottom-up model by grade and utilization. Ended 3 years of partner disputes. 6 hires modeled and approved.
01The Situation
An 18-person consulting LLC in Manhattan had been splitting profits by gut feel for 3 years. Two partners believed they were carrying the firm. Two others disagreed. None had data. Revenue was recorded at firm level and utilization tracked in a spreadsheet that two partners updated and three did not trust.
02What We Did
We rebuilt revenue model grade by grade. Every consultant rate, target utilization, and historical billing went in. The model revealed analysts were being used as admin support, costing the firm $180K per year in unbilled capacity. Partners voted on Q2 hiring unanimously after a 20-minute meeting.
Breakdown
| Grade | FTE | Rate/Hr | Utilization | Annual Revenue | Gross Margin | Status |
|---|---|---|---|---|---|---|
| Partners | 3 | $420 | 74% | $1.26M | 91% | |
| Senior Managers | 4 | $280 | 84% | $840K | 88% | |
| Managers | 5 | $210 | 80% | $1.05M | 85% | |
| Consultants | 4 | $140 | 62% | $630K | 78% | |
| Analysts | 2 | $90 | 58% | $420K | 71% |
First time in 4 years all five partners left a financial meeting without someone feeling cheated. The model gave them the same facts to look at and alignment followed naturally.
Want results like these?
Book a free consultation — we'll tell you exactly what we'd do.