How to build a successful freelance business
If you have been paying attention to what is happening in your professional circles, you might find that more commonly, people are striking it out on their own. The opportunities are many. Someone can start a company, join a smaller startup or even sustain their wages through freelance. How about to the tune of 43% of the US workforce being freelancers by 2020?
We are super excited by that future. A world where you can create a career for yourself without being confined to a certain region or wage limit. Much like how the Internet made information more accessible to the global community, I imagine a freelance workforce will make tremendous impact in distributing opportunities around the world.
If you are a freelancer or a solo agency owner, there are two things you control that can make your business wildly successful: how you earn and how you learn.
Let’s talk about how you earn.
1. Save before your start
The best freelancers prepare for the worst. Create an emergency fund worth 4-6 months of expenses which will give you enough comfort and motivation to be persistent with a set timeline. Be firm with yourself that once that is saved, you will start. I have seen too many talented people giving themselves a goal of wanting to freelance but keep giving themselves excuses to keep going for just a little bit longer.
2. Get paid upfront
You will have enough on your plate with the actual work, having to chase down invoices is a headache you do not want. Make it a firm non-negotiable that 50% of the project will be paid upfront and the rest upon delivery or in smaller portions if it is a large project. Pending payments can kill your business, so thinking about charging interest on pending invoices can create consequences for your client.
3. You start as soon as soon as you sell
You are officially in business the minute you have a contract. Start small and don’t let your portfolio work define you. Knowing what you want to work on lets you focus on what relationships to build and where to start doing smaller freelance work. If you want to start doing product strategy, start with UX research or prototyping. This way, you can eventually lend a small helping hand in a product conversation and relay that experience in the future.
4. Love your lawyer & accountant
Having your books and your contracts organized is a the foundation of all the transactions you will make. Not making any compromises on those fronts will save you from experiencing a lot of pain in the long term.
5. Don’t sell the portfolio, sell the process
Opportunities come in different sizes and forms. Selling your portfolio can limit the options of how you can grow your business and find new customers to serve. If you can challenge yourself to think from the perspective of your skill, you can find problems to solve and value to create. For instance, if I had a lot of print design pieces in my portfolio, I could limit myself to only print as a medium. Meanwhile, if I pitched my services as communication design, I can see myself creating more opportunities.
6. Don’t count hours, count value
If you take a rough hourly rate and guesstimate the number of hours to define a project, you are undervaluing yourself and doing a disservice to your business. Instead, consider understanding the true value of what you are doing. If a client approaches you for a branding service, instead of giving a package rate, consider learning more about why they are seeking a rebrand in the first place. The more data you have about the scenario, the better you can understand the problem and give a more personalized consultation. Maybe you find that they haven’t talked to enough customers and you can help facilitate conversations and record how customers currently feel about the brand and how relevant it is to them. You just created a more involved service and a true solution for their problem.
7. How you know you underbid
Once you sign a client, you will experience the biggest high. The reality kicks in and when the work starts, the true measure of the quality of the relationship is determined if you can sustain your mood while working for this client. If you are finding that you are avoiding calls or begrudgingly taking meetings, you have started to regret how much you are getting paid for it. You might need the first few projects to truly understand what your bandwidth is, and that’s okay. Give yourself time to grow and experiment.
8. Confidence comes with experience
Clients develop confidence in you once they allow themselves to trust you. The trust comes from understanding that you know what you are doing and you can take care of what they want.
These are things I wish I had known when I started freelancing. They seem like common sense to me now, but I would never trade those experiences for anything. Each one has taught me a specific lesson. Whether you are thinking about freelancing or looking to grow your business, the gift of controlling your time is the biggest luxury of life, so have fun with it and I wish you do the best work of your life.