How to Transition From Being A Freelancer to Starting A Company
The term ‘startup’ is thrown around loosely today. Almost every freelancer (or an aspiring one) claims to have his own startup. If he outsources some work to other freelancers in a couple of projects and does the bulk of the work himself, that’s it. He proudly declares he has a startup. Or if he’s a single person working on a beaten-to-death idea, he has a startup. The next thing he’ll look for is funding.
Okay, let’s not poke fun at people. (Pretty convenient for me to say it after having done just that.)
I’ve noticed a pattern among freelancers I’ve interacted with. Most of them don’t want to remain freelancers, or one-person companies. They dream of leading their own startups. But they don’t know how to make the transition, or where to start. Whom should they should hire, how should they acquire clients, business modeling — they find it tough to answer these questions and more.
If you’re looking to take baby steps and start a company, these pointers will help you lay the foundation.
1. Change Your Mindset
I quit my job when I knew I could make a living off content writing. I also learned link building, SEO, SMM and more by reading blog posts. It made me a well-rounded content marketing freelancer. But it also made me work more.
I spent more time doing work and almost none expanding my business. Suddenly, I lost 3 clients in two months and went broke. You need to have a Plan B — something you can fall back on if the funds dry up.
You also need to switch from the technical mindset to the entrepreneurial one.
A technical mindset means you focus on end-delivery, because you‘re skilled at the technicals. But this demands all your attention. It makes you micro-manage tiny tasks, leaving barely any space to focus on growth.
The entrepreneurial mindset doesn’t focus on petty details. Instead, it creates a system which can deliver end results. It’s one which lets you manage, direct and chastise others to achieve business goals.
The biggest fear of a freelancer, or the founder of a startup, is delegation.
Founders fear losing control, or assume people whom they hired cannot handle work as well as them. This might be true to an extent. But as a single person, you can achieve only so much.
Delegation enables you to improve yourself in other aspects. Find someone who can do stuff better than you. If not, find someone 70 percent as good as you, someone who harbors passion and the spirit to learn. Then train them to get to your level.
But if you’re not good at something, don’t spend too much time on it. You might feel like you’re learning a new function. But spending time and effort to get mediocre results is hugely discouraging. Plus, you’re always working and not thinking about growth.
Hire people to handle repetitive tasks and free your mind.
Which brings us to the inevitable question: how will you find the right people?
3. Hiring People
The right people aren’t just those who possess theoretic knowledge about a subject. They’re people who have good hands-on experience. They are passionate about doing more than getting bored for 8 hours behind an office desk.
When I had plans to hire people, I gave them a week to complete a project. These were case studies about improving my clients’ performance. And I paid them for it.
Neither returned with satisfactory results. But these were investments, not expenses. It saved me the trouble of spending time and energy trying to change their perspectives after they got onboard. After this, I realized money is not the most important currency. Time is.
However, don’t try scaling up too fast. Most entrepreneurs scale up on a whim. They fail because they jump into the far end of the pool without learning to swim. Keep your startup lean, suggests Hootsuite founder Ryan Holmes. With time, steady rewards will flow in.
4. Choosing Clients
To build a strong business reputation, associate yourself with customers who appreciate your work. Such customers stay with you for longer, and working with them is fun.
Hire Virtual Assistants to get information about events near you, and their contact details. Attend them and get speaking gigs if you can. These are useful ways to get customers onboard.
This also means what you offer must not be common in the market. You don’t need to have a unique product. You can package it such to offer features which most players in your category don’t provide.
To get 10X (or even 3X) results, you must differentiate yourself rather than offering a run-of-the-mill product or service.
As a content writer, I would take up low-paying projects. This kept me busy. But people who pay less demand service which will make the Ritz Carlton pale in comparison.
I’ve stopped negotiating on price. Instead, I negotiate on value. If a client believes I am too expensive, we shake hands and part ways.
Your clients should feel the pinch when they pay you. Yet, it should be an amount they’re capable of paying. They’ll hold you in high esteem and cooperate better.
Don’t negotiate with new hires on salary either. Negotiate on value — what they can bring to the table. They’ll stay motivated and you’ll get better results. This will also free up time for you, the entrepreneur, to focus on business development.
Creating a self-sustaining company is no rocket science. The above mentioned practices are simple, and enough. But you’ve got to be consistent while following them. Plus, you’ve got to have passionate people, and keep ‘know-it-all’s away. And remember, guard your time zealously. Use it to pursue the growth of your business rather than always addressing customer fears and being available for all their demands.