Productising professional services is seductive: it promises scale, stronger margins and a more valuable business. Yet for co-founders of B2B consultancies and creative agencies, the move from bespoke delivery to repeatable offers can expose differences in risk appetite, roles and ambition—creating friction that quietly pulls a partnership apart.
Why professional-services founders productise
If you run a consulting, research, or creative services firm, the desire to move beyond “selling hours” is not vanity – it’s a rational response to how your business model behaves under stress.
Three forces are pushing you toward productisation:
- Scalability and growth ceilings
Knowledge-intensive services grow linearly: more revenue needs more people and more hours. Aalto University’s 2024 research on consulting scalability notes that achieving true scalability in consulting “is not usual” because projects are highly customized and dependent on human expertise. Productising parts of your service lets you disrupt that linear relationship and grow revenue faster than headcount. - Margin, valuation, and exit pressure
Product companies enjoy far better economics than services firms. Rich Mironov points out that investors often value pure license ARR at 6–10x revenue, while services revenue may be valued at 0.4–0.8x – meaning a dollar of product revenue can be worth around ten times a dollar of services revenue at exit. For co-founders thinking about their eventual exit or de-risking, that’s impossible to ignore.[mironov] - Competitive pressure and client expectations
As clients increasingly expect dashboards, platforms, toolkits, and self-service options, staying purely bespoke can leave you looking slow and expensive. Productisation – standardizing and systematizing services into repeatable offerings – is one route to sustainable competitiveness.
In other words, your instinct to productise is right. The risk lies not in the idea of productisation, but in underestimating what this business-model change will do to your co-founder dynamic.
Why productisation creates co-founder conflict
Moving from services to product isn’t just a strategy shift; it’s a full-body business transformation that hits every founder where it hurts: identity, influence, and income.
Two business models under one roof
Mironov draws a sharp distinction between services and product businesses:
- Services firms sell people’s time, promote their skills, and make heroes of expert teams.
- Product firms sell a specific product, make the product the hero, and push for one version, minimal customization, and fast time-to-value.[mironov]
He’s blunt: companies that try to be both are “fundamentally misaligned at the executive level” and place contradictory demands on every function. In practice, that misalignment plays out inside the founding team:[mironov]
- One co-founder still optimizes for utilization, billables, and keeping big clients happy with bespoke work.
- Another pushes to say “no” to custom projects, reduce services, and force a standardized product and roadmap.[mironov]
Both are “right” inside their own model. That’s what makes the conflict so corrosive.
Conflicting incentives and KPIs
In mixed models, Mironov describes Customer Success and Professional Services teams trying to sell “more custom work, more development projects, more billable hours,” while Product and Engineering push for “a single released version, less single-customer development, fewer unique packages.”[mironov]
Translate that to founders:
- The commercially or client-facing founder is rewarded (and emotionally validated) by saying “yes” to high-value custom work and keeping key accounts sweet.
- The product-driven founder is rewarded by saying “no” to one-offs that fragment the roadmap and slow down the product.
Every pipeline review meeting becomes a referendum on the business model – and, by extension, on each founder’s judgment.
Identity threat and changing founder roles
Research on productisation in consulting emphasizes that services are human-centric and clients expect tailored solutions, which makes standardization both attractive and threatening. When you move toward productised offerings:
- The “craft” of bespoke strategy, research, or creative can feel devalued.
- New capabilities – product management, engineering, platform operations – become more central.
If one co-founder is strongly identified with the legacy, high-touch service and another is driving the new product, it’s easy for the shift to be experienced as: “Your contribution is the past; mine is the future.” That’s rocket fuel for resentment, especially around equity and decision rights.
The investment dip and fear of a revenue cliff
Aalto’s work makes a critical point: productisation initially requires additional investment and can temporarily worsen the ratio of inputs to returns before scalability kicks in. In plain terms:[aaltodoc.aalto]
- You have to slow down, codify, standardize, build, and document – while still delivering existing projects.
- You often accept a short-term margin hit or revenue plateau to build something repeatable.[aaltodoc.aalto]
For a risk-averse or financially focused founder, this can feel like willful self-sabotage: “We’re walking away from money on the table.” For the visionary founder, the real risk is not investing enough. Both are scared – they just fear different futures.
Resistance founders must absorb
Even when founders agree “in principle” on productisation, they face internal resistance. Productisation often creates internal resistance because delivery teams may fear that standardisation will reduce their autonomy, weaken client relationships or devalue specialist craft. Consulting research highlights the need to rebalance standardization with tailored client work, which is often where front-line consultants and creatives feel most proud and differentiated.
Founders absorb that emotional load. If one founder identifies more with the delivery teams, and the other with strategy or product, they naturally take opposite sides in internal debates – and those internal debates quickly become personal.
What experts see in practice
You don’t have to take my word for it; the patterns show up consistently in expert commentary and research.
The services-to-product tension
In his essay Moving from Services to Products, Mironov describes a B2B company with a mix of license and services revenue, whose CEO and board want to grow ARR while reducing services. Under the surface he sees:[mironov]
- Customer Success treated like an outsourced services arm by large clients, doing custom work and human-powered analytics.
- Engineering constantly dragged off the roadmap to fix bespoke implementations and one-off integrations.
- A “stack of single-deal commitments” consuming R&D time, with everyone complaining about lack of innovation.[mironov]
He explicitly connects this to executive-level conflict:
Customer Success and Professional Services push to sell more custom work and bill more hours, while Product and Engineering push for less single-customer development and a single released version. He notes “lots of shouting driven by diametrically opposed goals.”[mironov]
The fix he advocates – CEO-led, company-wide commitment to a product model, clear comp changes, and even spinning out the services arm – is exactly the kind of structured intervention most co-founders only consider once they’re already exhausted and mistrustful.[mironov]
Why consulting firms are especially exposed
Ilana Klimscheffskij’s 2024 thesis on scalability through productisation in consulting underlines why your world is particularly sensitive:
- Consulting offerings are highly customized and rely heavily on human expertise, making scalability “not usual.”
- Productisation can increase efficiency, profitability, and internal clarity, but it creates real challenges around balancing standardisation with customization and overcoming resistance to change.
- The work of defining, modularizing, and standardizing services forces the firm to make explicit decisions about what it will not do, and what “the product” really is.
For co-founders, that translates into hard choices: which clients, offers, and ways of working survive the shift – and whose instincts we are going to back.
What The Distance Between Us reveals about founder drift
In The Distance Between Us, the co-founders of a successful services business drift into precisely this trap. Their ambition to build proprietary tools and productised offers begins as a sensible operational improvement, but it is never treated as the fundamental business-model decision it really is.
No one pauses to decide whether they are still primarily a services firm or becoming a product business; what that means for leadership, decision rights, commercial priorities and each founder’s future contribution. Instead, they try to bolt a product onto a services-led business – creating the competing incentives, resentments and “you always/you never” dynamics that turn strategic tension into personal conflict.
Revenue targets remain services-heavy. Sales continues to promise tailored solutions. Delivery prioritises large bespoke projects. Product gets what is left of everyone’s time and attention.
By the time frustrations are voiced openly, the founders are no longer debating a strategy; they are defending their identity, contribution and vision for the business. The relationship problem is real, but its root is an unspoken business-model shift.
If you are considering productisation, do not let an unspoken business-model shift create the distance between you and your co-founder.
A co-founder alignment checklist before productising
Before you invest in a productised offer, agree the answers to these questions:
- Are we creating a more repeatable services business, or building a genuine product business?
- Which existing revenue will we protect during the transition, and which work will we deliberately stop accepting?
- What level of upfront investment, margin pressure and revenue risk can each of us tolerate?
- Who owns decisions about product, pricing, client exceptions and the roadmap?
- How will we measure progress: utilisation, recurring revenue, gross margin, client retention, enterprise value – or a deliberate combination?
- What will we do when a major client requests a bespoke exception that compromises the product model?
If you cannot discuss these questions without defensiveness, pause the product decision and address founder alignment first.
Get support before the tension becomes personal
The uncomfortable truth: you can’t separate “professional services productisation” from “co-founder alignment.” The move that could make your agency more scalable and more valuable is the same move most likely to expose and amplify differences in risk appetite, vision, and identity.
Productisation can make a professional-services business more scalable and more valuable – but only if the founding team stays aligned on the trade-offs it demands.
As a co-founder conflict specialist, author of The Distance Between Us, and founder of Sapio Research, I work with B2B consultancies and creative agencies at precisely this crossroads. My Cofounder Accelerator Programme is designed to:
- Surface and align your real ambitions for productisation (scale, valuation, lifestyle, exit) before you lock in irreversible decisions.
- Map how your current business model really works – and what will break first if you try to run a product and services model side by side.
- Create an honest, shared plan for roles, decision rights, and “red line” boundaries as you evolve your model, so tension becomes productive rather than destructive.
If you are contemplating productising your professional-services offering – or have already begun and can feel the strain emerging in your co-founder relationship – get in touch to discuss whether the programme is the right next step for your founding team.