This is a typical growth problem we all face. A few points:
* Having only one customer, who is pushing for you to hire, is a scary place to be, especially if they then try and lock you out of consulting for their competition. What happens if you hire staff, the client`s budget changes, and you`re sitting there with nothing in the pipeline?
* Paying with equity is the stupidest idea on the planet. NO form of capital is more costly than equity. I`d delete that idea out of hand. Not like that guy had an agenda anyway...ahem.
* The prepay discount idea is a great one. Just mark your invoice `2% cash discount if paid on receipt, net 30 days`. Any decent-sized company with an accounting department will be REQUIRED to pay that invoice as part of their cost-cutting measures. Just putting that line on invoices has been great for my cashflow.
* What about an intern on a 60-day trial which could lead to full-time at graduation? It`s January already - they`d be off the trial in April and graduating in May.
* A contractor might not be too happy with a pay-after-the-fact gig. Waiting until after the work is done probably won`t get you anything but the unemployed and underqualified. Good people expect timely payment. Two weeks - sure. 30 days - tough.
* Find more clients, for god sakes. I know we have all faced this - you can`t turn away from actual work to be done and still keep marketing - but if and when the client finds out they are your sole client, don`t be surprised if they start squeezing you for other consessions, like volume discounting, etc, etc.
Good luck. Always a good problem to have.