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Starting Up A New Freelance Business
Posted 30 September 2003 - 07:25 PM
I've been whining for a while about how I hate working for The Man and want to start my own business. Well, I actually did, and now I'm wondering how on earth I'll ever get it under control. I actually have two clients already, through forums (an incentive to you lurkers-- if you actually post a bit and have something useful to say, you might get a decent reputation and so people might start thinking of you as a possible professional business contact! A good side effect from spending so much time in these places, though I think I spend too much time drunk in the pub of this forum, ).
So. Yes, I'm a freelance copywriter.
My website's a shambles (unstyled content and unedited copy-- ). Note: This is not a site critique! I know what I need to do for my website, which is EVERYTHING!
I have no real financial plan.
I have a buddy who's a lawyer,
and another buddy who's an accountant,
but I don't even know what to ask them.
And, I have a deadline:
I want to be able to quit my current full-time job by next spring so I can relocate to a new place. (Safety net: I'm planning to get a part-time job as a bartender for some steady scratch-- a friend of a friend knows a place maybe, etc. etc.)
This is what I think I'll need, and I'm hoping y'all can tell me what else you think I need, what you *know* I have to do, and what I'm missing, and where I'm mistaken.
1. Rates. I need to set my rates. How do you generally set rates? Figure out how much you need to earn in a year, figure out how many hours a week you'll actually be able to work (figuring in how many hours you'll need to spend looking for that work, etc.), then figure out how much you can do in those hours, and go from there in figuring out how much your time has to be worth?
I don't really have a clue about any of that, so at the moment I'm taking wild guesses at how much to charge. Which is bad, because my clients may well end up being the long-term sort you feel bad raising rates on. One thing I'm sure of, I'm not charging too much!
2. Organization. I need to really get myself organized. I need to find a good way to keep very good notes on everything I do, keep very very good track of everything I'm working on, and for who. Who's supposed to pay me when, and I need a good system of what to do if the payment doesn't happen as expected.
3. Legal stuff. I don't know what I need, legally. Do I have to incorporate? Do I need to set up a separate business account? Do I need a tax ID number or something like that? Or what do I do? I just need a few basic guidelines-- I already have the lawyer buddy and all (who by the way owes me a favor anyway, etc. Never hurts).
4. Self-promotion. So far, my marketing plan is this: Build a good website, with a good, solid, diverse portfolio. Post a lot of really intelligent, thoughtful, well-written posts in forums. Put a link to the good website in your signature.
I plan on expanding that once my website's ready for the prime-time-- that's when I'll start doing some serious SEO on my own site, and I'll probably sign up for one of those freelance sites that gets you work. Also, I'm going to check local messageboards for jobs where my skills are wanted. (craigslist is one that's got several regional sections. i'm sure there are others, I'm going to find them.)
I also plan on continuously developing a lot of good content for my website-- possibly to build on my forum rep, and partly because I actually enjoy developing content. I'll look into getting articles I write published on other sites and maybe even in print media (:gasp:)
In the meantime, I'm trying to do this as cheaply as possible. I'm planning to spend money, sure, just not all at once. I'm hoping to space out my expenses. Once the website's up (I'm saving money by doing it myself, but only because I know I can.) I'll get some very cheap business cards printed, for example. Once I move, then I'll invest in more expensive, better-quality business cards. At the moment I'm using as much freeware software as I can; as I start to have income, I'll invest it in better, licensed software. Likewise, I'm getting as much free advice as I can now; as income increases, again, I'll hire an accountant and the like. See where I'm going with this?
What am I missing? I have six months (or so) and not a whole lot of spare time. Think I can do it? What should I do? What am I totally hopelessly naîeve about? What more do I need? Am I forgetting something obvious?
(and if you can keep your answers general, it might help out a couple other people I know in the same boat.)
Anyone have any good success stories? Any good failure stories?
I want to hear 'em all!!
Posted 30 September 2003 - 07:53 PM
outlook is great at organising, i take a pocket pad with me to see clients and write in it the points that matter the little things like ' when does an invoice have to be in to get paid this month' lol on that note agree WHEN they will pay you, this is crucial to credit control, if they say get your invoice to us by x, and it will be paid on y, then make sure this happens, if it doesn't get on the phone, if you have done the job right they will want to pay you right. The best advice ever is to keep a to do list, and every night go through it and write down in order of importance things that must be done the following day, then when you start work through it in order, that way you will be certain of doing the most important things, and you can start off right away without wasting time in the morning
Try writing a bit of FREE charity content, this will expose you to the public, but more importantly the kind of people who carry out voluntary work are likely to be business people who may need your services, I fell into this fact after genuinely wanting to give a bit back to the community. I designed and printed (digital copier) some mini soccer programmes for a local soccer club, i even sold a bit of advertising in it for them and they got their progs free plus £300 in ad revenue. When i was delivering them the father of one of the kids asked me for my card, I did not have one with me but said i had put my contact details on the inside cover, he called me and turned out he was CEO (MD) of a company that had 40 stores nationwide, i did a load of work for him, as he decided that I must be straight to have done the work for nothing, and as he said, my not having a business card with me when he asked cemented it for him..
FInally you MUST set targets if you don't you will still be wandering around in 6 months time, work out what you wan to achieve, work out how to get there, work out the cost, (in time effort & financial) then decide if you are willing to pay that cost. if you do that then you will get what you want
Posted 30 September 2003 - 11:00 PM
As to your legal status, that depends. You really should talk to both the lawyer and the accountant before you make a decision. There are tax implications as well as liability issues, and there's no one way that's correct for everybody. They should be able to advise you as to what would be best for YOU in your specific situation.
One thing you probably will want to get as soon as you can is business insurance. You'll want at least errors-and-omissions, possibly general business liability, too. One company I've seen advertised in independent consultant magazines is TechInsurance.com. There's also InsureNewMedia.com, who also specialize in providing insurance to the IT industry. I'm sure there are others, so shop around.
What you really might want to start with, though, is a good business plan. Take a look at BPlans.com for some sample business plans (they sell software to write plans, but they've got free sample plans and I'm sure you could get a good start on one just from that).
Don't forget various free resources like SCORE (Service Corps of Retired Executives -- http://www.score.org/). There's also the Small Business Administration, particularly their Womens Business Center (http://www.onlinewbc.gov/). There's a bunch of advice and resources available there.
Posted 30 September 2003 - 11:10 PM
For self-promotion -- don't forget the local market. Join the local chamber of commerce (either the one where you are now or the one where you plan to move to, if it's far away) and volunteer to write a column in their newsletter about small business marketing or website design/marketing/content development (or whatever). Maybe find a local newspaper and see if they'd be interested in a periodic column. Our local paper runs a column about once a month or so on the subject of animal care, written by a local vet, which has her contact information at the end of every article.
Also through the chamber, see if they have a speaker's bureau and sign up for that. Find out what business and professional organizations there are in the area and send a letter to their program chairperson, offering to do a presentation at one of their meetings. As a former program chairperson, I can tell you that finding new and interesting speakers is an ongoing and difficult task, so you'll very likely get some positive responses. Just make sure your speech is short, to the point, and useful information (NOT a sales pitch). Bring plenty of brochures and/or business cards to hand out afterwards -- THAT'S when you get into your sales mode.
Just a few more ideas to toss into the pot...
Posted 01 October 2003 - 08:17 AM
Someone referred me to http://www.myownbusiness.org, which is a really good resource too. Have to check it out in more depth... don't have time right now.
Posted 01 October 2003 - 09:38 AM
Don't know exactly where you are at (I'm in Arizona) but I would suggest you incorporate and ask for S-Corp status as S-Corps are not double taxed as regular corps are. Once they approve you for s-Corp status, you will be issued a tax id number.
3. Legal stuff. I don't know what I need, legally. Do I have to incorporate? Do I need to set up a separate business account? Do I need a tax ID number or something like that?
In my state, we had to first get a trade name and then were able to open a business checking account. After that we incorporated. Being incorporated protects your personal assets in the case you are ever sued. They can't go after your personal stuff, only the corporation stuff whereas if you are a self proprietor, I believe your personal assets are unprotected.
Good luck with it. Once you start working for yourself, you'll never want to work for someone else again.
Posted 01 October 2003 - 09:59 AM
Posted 01 October 2003 - 10:08 AM
Stay away from partnerships or sole proprietorships as their is not really any corporate shield against liability.
It really doesn't cost a lot to form these types of companies. It can be intimidating at first. It is best to find a good corporate attorney. One that really understands corporate law, but at the same time won't smother you in charges. Getting this set up correctly in the beginning can save you much money and grief in the long run.
This was probably more than I should have said and more than you wanted, but business is something I know as compared to SEO and the like.
Posted 01 October 2003 - 10:10 AM
I would emphasize: Try to get some gigs giving informational seminars, either for free or charge (both have their advantages.) Learn how to present. Learn how to speak. I could go on for hours about the virtues of doing this, but for starters:
- Free, easy publicity
- Speaking positions you as an expert to the people that are in the audience
- It adds to your ongoing reputation
- It makes you better at what you do
- It "sells" the attendees on your abilities and expertise
- There are few better ways to get a well targeted audience in front of you
- And its a great way to meet people in the local business community
Check out the book "Presentations Plus" for a quick read that will give you a great start in this direction.
One tip about the giving a presentation, is that when people leave, a few will come up and want to talk to you afterwards. They are good prospects. But you really should plan on a sales call to each and every person in attendence. Many times, the people there may be shy or in a hurry to leave and will not contact you afterwards! It helps to have a salesperson working for you to follow up with everyone.
As far as keeping control of your accounts and finances goes, you definetly need to get a copy of Quickbooks, and learn how to use it. When I first started my own business a few years ago, I didn't have a good system, and ended up not billing some clients for work that I had done! Not only do you not get paid, but you look very unprofessional in the process (if they notice.) Or you can try to go back 10 months later and bill them, but that looks even more unprofessional!!
And most of all, HAVE FUN!
Posted 01 October 2003 - 10:10 AM
Well I'm not a lawyer but IMO if one starts as a freelancer and plans to evolve into a company, then I recommend it. I started as a one man company in 97 and by 98 incorporated. Now there are 7 of us. However, I did not start as a freelancer but rather a company.
David, do you recommend incorporation even for a company of one -- someone who's strictly freelance?
I guess if someone is just going to be a freelancer and will not represent themselves as a company, it may not be necessary to incorporate.
Posted 01 October 2003 - 10:20 AM
Posted 01 October 2003 - 10:31 AM
I'll definitely look into it, though.
<edit> Whoops, more posts while I was distracted before posting that. Yes, thank you all for that advice. I'll certainly bug my lawyer-friend and see what he thinks. Some friends of our family put up their house as collateral in starting a small business, and a while later their house was suddenly confiscated-- I was young and this was a long time ago, so I don't understand the details. It was a shock to me, to have my friends suddenly homeless! Their children didn't understand at all what was going on, and I'm sure it was exceedingly difficult for the whole family.
I certainly don't want anything like that! But, on the other hand, I do want to do this as my full-time job, so I want to do it *right*.
Good tips, everyone.
Edited by dragonlady7, 01 October 2003 - 10:42 AM.
Posted 01 October 2003 - 11:53 AM
I think it is very important to have a simple company name that is memorable and can be exactly the domain name of your website: so no hyphens or symbols in the company name. The name should be such that one of your target prospects on hearing it says "We've got to talk, I know you can do something great for me."
It's far from easy. When you have it, you make sure that you pour all your considerable energy in promoting that same company name wherever you can. I believe this will give you much more selling effectiveness than anything else you can do.
Of course, if you find the company name thing difficult, you can always think of a not-more-than 10 word slogan that says exactly why you are so much better than all your competition for your target prospects.
Posted 01 October 2003 - 12:19 PM
I definitely need to do more research on this question of incorporating. I've sent a request for information to somebody at SCORE, and I'll see what he has to say about it.
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