5 years of freelancing - sharing my experience

Five years ago, I made a decision, that at the time seemed difficult because it was so different from what I had done before that: Going independent and becoming a freelancer.

The main reason it was not an easy decision: Let’s say, I’m not the type that takes risks and up to that point had mainly worked in companies that were pretty much “safe bets”. You know the gig: you get your cell phone, you get your computer, in some cases a company car, you learn the ropes of what is important and not and you start in a place, where you give your best. At the end of every month, there’s a paycheck in your bank account. On top of that, if everything works out fine, at the end of the year, you get a bonus.

Well, I broke with that. And don’t get me wrong: let me repeat that I will not pretend I am the guy who planned it out like that. It sort of happened to me. Not giving too much detail about it here (maybe I will provide it in a later blog), I felt that I had no other choice than moving in that direction at that moment.

It was a moment of nervousness, of not knowing what lies ahead and where I was looking for information of the kind I am posting here, to make more informed choices.  The problem was that it wasn’t available then as I couldn’t really find it.

In a sense, what I am writing here is a letter to “my former self”, just writing down what I would have wanted to know at that moment, so that it may help someone who finds himself in that position today.

So, here’s my top 5 learnings:

1. You got something to offer? Put yourself out there and do the convincing!

This first point has to do with you, being yourself and on your own, having proven that you can do it inside companies. If you are like I was, there’s a big caveat to that: your brand value does not really exist; you have always been there with a company, sometimes even a big brand name, behind you.

That. Is. Very. Different.

What do I suggest you do? If you really have something to provide (technical skills, project management experience, product management, sales skills, whatever it is), put it out there. How? Make calls, talk to people, fail many times with headhunters, work with startups. Do whatever you need to build that credibility for yourself. Most of the times you are not famous: your brand is new and has to be put to the test yet.

In my case, sometimes I had to prove I had banking concepts thoroughly learned and the statistical programming to back it, having had no actual hands-on consulting experience in the sector. What did I do to compensate for that? I got my certifications, I proved in conversations that I could handle the concepts. And it worked out.

So, if your offer to the market is worth its value, customers will come. Sooner or later.

2. Freelancing ≠ Free + lancing

This is a very important point. When idealizing the freelancing market, people often think, it is a world, in which you are pretty free, where you set the fees and everything works from there. “Workcations” included.

A little bit, it is like that… but in reality, it isn’t. The moment you sign a contract, your freedom gets restricted and you go back to the feeling of reporting to someone. It makes sense: You have responsibilities towards your customer now. You have a boss. You may not have a performance review as such, but you have it indirectly: if you are not able to deliver on what is expected, you are out of the project. That’s a drastic performance review, isn’t it? It is a performance review to its fullest extent.

So, if you want to be really free, get yourself some millions, buy a castle, sleep all day and get up whenever you want in the morning to swim in your Olympic size pool. But I am sorry to say: freelancing doesn’t give you that.

3. It’s a commodity market; understand that fast

Most of freelancing has to do with offering skills that are common in the market and that companies acquire temporarily and on-demand.

I am no economist, but I figure that this comes close to any definition of commodity. At least, when I want gasoline, I tour around in my Twingo, I find the best price that is close to home and I buy. There’s the requirement aspect, there’s the offering, there’s the contract in the form of filling up my tank and a restriction (closeness to home).

What implication does that have in freelancing? Well, that there are prices driving the fees. Try understanding that quickly. Of course: you can charge €250/hour because you believe you have really special skills. But if the highly specialized skills you have are not what is very specifically required in the projects you are applying for, then you are out. And it will happen often. Understand it.

If you are part of a commodity market you are, to a non-trivial extent, a price taker. Of course, you can handle prices above market, but there is an average reference. If you want to stay in the market, try to find it and use it as a benchmark.

4. Headhunters are a vital component of the freelancing market

Commodity markets have traders. Traders have an economical value in what they do, as they have direct key contacts with the buying and the selling side. Their job is to provide efficiencies in contracting. And they get paid for that.

In the past, I have had discussions with freelancing colleagues, who find the role of the headhunters unnecessary, in parts they get offended by their presence and even get angry that often they get paid very high fees.

I don’t agree with them. If you apply the commodity market and traders’ logic to what headhunters do, their presence makes a lot of sense. They “grease the market”: they look for the relevant actors from the buying and selling side and make the process more efficient to get them together. And guess what? They charge money for that: it has a price. When they do it right, they will choose great candidates for great projects, very fast.

Am I saying that all headhunters are super-efficient and do their work the way they should? No, definitely not. There’s a lot of room for improvement in my experience. But do I understand why they exist and what their role should be? Yes, I do.

5. Set yourself some goals, stick to the possible… and adapt

It is relevant for you to know what you are trying to achieve. The answer to that is very personal, there is no generic recipe available. But you know why you are doing what you are doing (the idea of freedom, developing and enhancing skills in a specific field, monetary targets, whatever it is). Put some measurable numbers behind that. 

In my case, as mentioned, I felt driven into freelancing. Before I decided to take this step I had a conversation with my wife and she urged me not to get into “overdrive” mode: what I mean by that is that place of workoholism that would have been the normal for previous generations and where you permanently feel compelled to do something, without giving yourself a pause.

In the case of freelancing, that stage can be easily reached. For example: You may have had 4 months off projects and now you get a contract for 240 days for the following year. You might be tempted to work off the full contingent of 240 days. That means practically working the entirety of the year, without giving yourself any rest and no real vacation… just work, work, work.

That. Is. Overdrive.

Set yourself some goals and try stick to them as much as possible. In my case, the goal was to max out at 180 worked days per year. It didn’t work out, because 2019 turned out to be difficult, project-wise. The rule was set off for some years and adapted to 210 to compensate for the lost income. Still, the goal in mind is to go back to 180 when the compensation phase is over. Not deciding on this would definitely put me in overdrive mode.

So, these are my first 5 learnings. Hope they were of interest. If you have comments, suggestions, complaints or questions, feel free to drop me a line. 

See you next time.

Please feel free to share any thoughts or comments

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Tsunuun Consulting GmbH

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info@tsunuun.com

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