Suppose your job pays you $75/hr as salary, but charges clients $225/hr (a 3x multiplier, which is typical).  The extra $150 covers overhead and profit.  Much of the overhead is for things that you need: some or all of your health insurance, and they pay for your computer and software, conferences and training.  They also often give you a reduced billability target for marketing and admin, and they may contribute to your 401k. 

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But "overhead" also includes a lot of luxury for do-little middle-mangers and general wastefulness:  rent at premium locations, and splurging on dinners, parties, and a lot of items of questionable value.  They often develop costly proposals for jobs they are ill-positioned to win.  They often pay over-priced middle-managers and corporate leaders to hobnob at every conference, staying at 4-5-star hotels, and rarely doing billable work.   Who is paying for this luxury?  You are.   Overhead is high largely because employees and managers cannot personally benefit from fiscally wiser choices.

 

What if you could keep the savings from smarter overhead choices? 

Where most companies take around 67% of your billings for overhead and profit, at Urban Innovators, we require only 20% for "mutually beneficial" overhead and presently 0% for owner profit.  Here's some math.  Say today your salary may work out to $75/hr but your loaded rate is $225.  In our program, maybe you'll work it out so that the end-client only pays $200/hr - a good deal for them, and it makes you more cost-competitive.  So now, from the $200 you charge, Urban Innovators deducts $40 for mutually-beneficial overhead and $0 for profit.  This leaves you with $160 per hour - a whopping $85 more per hour than you are making now! 

 

However, you can't keep all of that for your Ferrari because you'll also need to pay for some of your personal overhead from that mega-raise! Computer, specialty software, conference attendance, training, health insurance, and hours for marketing, admin, and PTO.  But where your former company would blow all of that $85 on dumb stuff, maybe you'll spend just $40 to get the same value.  Instead of spending well over $1000 per month for the privilege of a $20 co-pay, you'll instead self-insure for anything under $10k, and you'll spend just a few hundred per month for "catastrophic coverage" (anything above $10k), and in about a year the savings will cover your $10k self-insurance. 

 

Instead of fancy hotels, maybe you go for AirBNB and pocket the savings. No longer will your hard-earned cash finance long-shot proposals and other foolish marketing efforts.  No "taxes" for primo office space, do-little middle managers, or corporate extravagance.  You pocket the savings, or you pass some savings to clients in the form of a lower billable rate so you can be more cost-competitive than your peers!  

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The 20% "mutually beneficial" overhead covers things are cheaper with economies of scale, or simply more practical as a group item rather than individual: Liability insurance, website & server maintenance, business cards, marketing flyers, email setup, Office 365, IT support, invoicing support, tax compliance, registrations, accounting and legal, and other paperwork issues.  Note: 20% is subject to change from time to time, either up or down, depending on transparent disclosure of mutual overhead costs.