So you want to be a consultant?

• Author: Gray, Carol Lippert
• Position: Tips on how to set up a financial consulting firm

Inside many financial executives lurks an independent spirit that yearns to hack off the corporate shackles, lease some office space and emerge, reborn, as Entrepreneurman (or -woman). But does the fantasy of setting up your own consulting shop match the reality?

Increasingly the answer is yes, though approaches vary. Years ago, says Ron White, consultants were seen as being between jobs, but now it's a booming field. When he started The Janelle Co. in 1990, he notes, "I was a trailblazer for part-time CFO services in the Atlanta area. When I first came upon the concept, there was a group doing it in Wisconsin and one in Connecticut."

White, 68, says his motivation was age discrimination. "I saw CFO tenures as three to five years, with five as long," he explains. "I was tired of going through [the hiring process]." He perceived a recruiter asking the year of his college graduation as a not-so-subtle attempt to ascertain his age. "I was getting too much gray on top and running into it making a difference," he notes.

Now he relishes being a solo practitioner. "I do it as an individual, vs. building a business," he says. "I like working with a company, seeing it develop, change, grow. I don't get a big kick out of cutting a deal and then cutting another one. I'm not trying to get rich here; I just enjoy doing it. I tell potential clients, 'I dare you to surprise me."'

Earl Schell, who founded Pyramid Group in Cincinnati with a partner six years ago, says he was a victim of a "changing of the guard. My boss retired; his replacement wanted someone new. And for every opportunity that came along, there were 500 to 800 other qualified applicants."

Through networking, he found that manufacturers of consumer products needed a better way to outsource their collections to resolve claims against invoices. But Schell says he and partner David Needle, a former treasurer, discovered something else, too. "We knew in our careers credibility is very important. While you have to reestablish credibility when you go to a arid new company, we thought ours would hold up with our peers no matter what. But when you make such a drastic change, your credibility still comes into question. We started the business when a lot of downsizing was going on.

Our contacts weren't certain we wouldn't go back into industry when times got better. Without a company behind you, you become an unknown quantity. That was a startling revelation." Still, he adds, "Both of us had very...