How to Price a Contractor in Months of Runway, Not Euros

To price a contractor in months of runway, run your planned-burn runway twice, with and without them, across the period you are planning. The difference is the price in months. Then ask whether they can produce something worth that time before your clock runs out.

How to price a contractor in months of runway

"They cost a fair amount a month" is not a price. It's a feeling with a currency symbol on it.

A monthly figure is an abstraction. You can nod at it, accept it, and still have no idea what you just did. What a contractor really costs you is time. Specifically, how many months of your remaining life as an independent business you just handed over.

That is a number you can feel. And it's the number to look at before you sign anything.

If you're a solo operator who wants to scale, a contractor is probably the first thing you'll be tempted to add. It's the sensible move. It's also exactly the sort of recurring commitment that quietly sets your clock, so it deserves better than a gut check.

Step one: get the base number right

You can't price a change against a number you haven't defined. So begin with the foundation.

Use your own one-sentence runway definition: net burn, cash actually in the bank, a trailing three-month window. If you haven't written it, start with how to calculate business runway. Everything below depends on it. Otherwise you'll compare a flattering before with a sober after and blame the contractor.

Then calculate two versions of the answer.

• Current-burn runway. How long you have if nothing changes.
• Planned-burn runway. How long you have if you do everything you said you'd do.

The contractor belongs in the second. That's the version people avoid because it's always shorter. It's also the honest one, and it's the only one that answers this question.

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Step two: subtract, over the right period

Now the arithmetic. It is not clever.

Add the contractor to your planned outflow, for every month you expect to use them, not just the first. Recalculate how long your money lasts. The gap between the two answers is the price, in months.

Two details make this honest.

First, the period. If the contract is open-ended, price a stretch you can defend, not the cheapest-looking slice. A commitment priced over one month and lived over twelve is a lie you told yourself in advance.

Second, everything attached. Setup time, handover, the hours you spend managing them, the tools they need, any minimum term. Put the real cost in. A contractor who saves you hours but costs you two tools and a retainer is a different decision from the headline suggests.

For a contractor in months of runway, that last row matters more than people think. A commitment you can stop next month is cheaper than the same one with a long minimum. The notice period is part of the price.

Step three: ask what a contractor in months of runway buys

You now know the cost in months. The next question is the one that matters.

Can this plausibly produce something worth that much time inside the runway that remains?

That sentence kills a specific, common, expensive error: committing to something whose contribution arrives in year two, in a business that has eleven months. The contractor may be excellent. The project may be right. The timing is simply wrong, and the timing is the only thing the maths can see.

So make the contractor earn it. What will exist at the end that does not exist now? More deliveries you can bill. A launch that reaches the market sooner. A channel running while you do something else. Name it. Estimate when it lands. Compare that date with your clock.

If the return arrives after the money is gone, you do not have a hiring decision. You have a loan from your future self at terrible terms.

What it looks like with a real choice

Say you run a productised service on your own, and delivery is the bottleneck. A contractor would let you take on more clients. Tempting.

You do the sum, and the answer is a certain number of months removed. Now ask about the return. If extra capacity turns into billed work within a few weeks, the months come back quickly and the commitment looks sensible. If there is no pipeline waiting for that capacity, you've bought room for customers who aren't there.

The fix is not to refuse. It's to change the order. Fill the pipeline first, or hire against signed work rather than hopeful work. That ties directly to how to forecast income for runway: count contracted and probable revenue, keep the hoped-for kind visible but unspent.

Compare the months, not the invoices

This framing also helps when you're choosing between options.

Two things compete for the same money. A contractor and a tool. A contractor and a campaign. In euro terms they look similar. In months they might not. One might remove a few weeks of runway for a clear, near return. The other might remove several months for a return you can only describe vaguely.

Sequencing becomes obvious. Which thing first? And is one more month of runway worth more right now than one more capability? Sometimes yes. Sometimes the capability is exactly what extends the runway. The point is that you now decide by the same unit.

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Three ways this goes wrong

You price the first month only. The first invoice looks small. The twelfth one is the same size, and so are all the ones between. Price the stretch, not the slice.

You price it against the hoped-for pipeline. If your base case already includes deals that haven't signed, the contractor looks affordable because the base is fiction. Use contracted and probable income only, and the answer often changes.

You price it once and never look again. Costs creep. Scope grows. A contractor brought in for one job picks up three. The number you calculated at the start is not the number you are living with, which is another reason for the monthly check.

When the answer is no, or not yet

Sometimes the sum says you can't afford them. Take that seriously. It's the model doing its job.

The temptation is to argue with it. You'll tell yourself the return will come sooner, the pipeline will fill, the work will pay for itself. Maybe. But that is exactly the hoped-for revenue that should never fund a decision.

"Not yet" has options that "no" does not. You can shrink the scope to a single deliverable. You can hire for a fixed, short engagement with a clear end. You can wait until the thing you want them to deliver has a signed customer behind it. You can move other costs first, using the order in how to extend your runway, and see whether the sum changes.

What you shouldn't do is sign and hope. Hope is not a line on the model.

And if the answer is yes, with a near return and a runway that can carry it, then sign with confidence. That is the real gain from pricing a contractor in months of runway. It isn't only a way to say no. It's a way to say yes without the knot in your stomach.

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Keep the contractor accountable to the number

Pricing is the start, not the end. Once you commit, put the figure in your monthly review. Did the months come back? Is the thing you named at the start showing up? If a contractor was priced to produce something by a certain month and it has not appeared, that is information, not an insult.

This is also where the habit pays off in the long run. If you review the runway every month as described in how to review runway monthly, a commitment that is not earning its months shows up early, while ending it is still cheap.

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Frequently asked questions

How do I price a contractor in months of runway?

Calculate your planned-burn runway with and without them, over the full period you expect to use them. The difference is the price in months. Include setup, tools and your own management time.

Why use planned burn instead of current burn?

Because a contractor is a commitment you intend to make. Current burn assumes nothing changes, so it flatters you. Planned burn includes what you actually plan to do, and it is always the shorter, more honest number.

What if the contractor would pay for themselves?

Then show it. Name what they produce, estimate when it lands, and compare that date with your runway. If the return arrives inside the time you have, the commitment can make sense. If it arrives after, it cannot.

Should I price a tool or subscription the same way?

Yes. Any recurring commitment removes months. A small monthly cost over a long period can remove more runway than a short contractor engagement, so price both in the same unit.

The full method, with the checklists, is in The Runway Playbook, a free 23-page playbook.