Last updated 14 Aug 2010

Thoughts on Working for Yourself

This post is really old! I've kept it around because it may still be interesting, but many things may be out of date.

Two years and three weeks ago, I lost my job. My partner and I had just had an expensive deck built; I’d just bought a gratuitously fancy grill to go on it. My token severance check was in the mail — I’d spend most of it to be able to keep my work computer. And so, six-pack of Yuengling and a pack of Parliament Lights in hand — I hadn’t smoked in years — I sat on said deck near said grill, contemplating a world I’d last contemplated when I, age 6 at the time, came home in the middle of the day to find my just-laid-off dad sitting on the porch.

It was not a good day.

Two years on, things look a lot better than they did. My “salary,” as best as I can figure it, is comfortable. Figuring it is hard: I travel to conferences whenever I want, and work pays for them. I buy new equipment and software when I want, and work pays for it. I don’t work a certain number of hours in a day or a week or a month, so I’ve been able to get my pilot’s license, spend two weeks in Hawaii without drawing on some meticulously calculated vacation balance, and take on projects like TXJS without having to get anyone’s blessing — hard to put a value on that. On the flip side, I’ve had more sleepless nights than I’d dare count, wondering where the money was going to come from next month, wondering whether it was time to walk away from an abusive client with no other work on the horizon, wondering whether my relationship could tolerate all the ups and downs, wondering how it was that little ol' me, the Independent Consultant, had any business telling people what to do.

People ask me, now and then, what advice I have for them about being independent, about working for myself. More than a few of them have suddenly found themselves sitting on that proverbial deck, waiting for that severance check (or not). I’ve written many an email, but I thought I’d take a few minutes to try to assemble all of them into a coherent post.

The Touchy-Feely

Network

Once I decided I was going to stop looking for a job and work for myself, I wrote an email to absolutely everyone I could think of who might help me find work. It felt weird, and it’s also exactly how I landed a job that paid the bills fairly solidly for the next nine months. When you decide to take the plunge, it’s imperative that you let people know. Let them know you’re looking for work, and what kind of work you’re willing to do. Get out and participate in your local tech community, giving talks and connecting with people who can connect you with people. Start writing blog posts, answering questions on forums, helping people in IRC channels. Become known as a helpful and knowledgable person. You do not get to be an introvert. Getting your name out there, when you start and constantly after that, is the No. 1 most valuable thing you can do — at least as important as being good at what you do.

Dive in and Do

I cost a fair bit of money. In return for paying that, clients expect that I can come up to speed on their project quickly and start solving their problems for them — they don’t want to pay for a long ramp-up period before they can even accurately assess whether my time was a good purchase. Part of doing this is having solid fundamental skills — an understanding of basic application development patterns, version control systems, development environments, etc. When I don’t have those fundamental skills for a particular project and I expect that may get in the way of a quick ramp-up, I make that very clear to my clients.

More generally, it’s critical that you demonstrate value as soon as you can, and make sure your clients are well aware of the progress you’re making — if they don’t ask you, tell them anyway. If you get stuck on a particular problem, part of your job is to recognize that you’re stuck, and honestly assess whether this is your own shortcoming or not. If it is, think long and hard about whether you should bill the client for your learning time; if it’s not, at least let the client know about the roadblock and your plan for overcoming it — you never know, the client might re-frame the problem in a way that’s easier to solve.

Don’t Specialize … Yet

When you first start, it pays to be open-minded about the kind of work you’ll take on. It helps get those bills paid, but also, it helps you zero in on exactly how you’re good at providing value to clients. The value you provide may be entirely different than the value you were providing at your job, or even than how you thought you provided value in general. Over time, you can start to market yourself using true stories of how you helped real live clients, and start to develop your niche.

Think Global (and favor clients who do, too)

I have had clients in California, Florida, New York, and places in between, but I’ve never needed to travel to any of them. I find that the work I do is incredibly time and place independent, as long as the client has good systems in place. This means version control, a development environment I can ssh to, liberal use of IM, a sane deployment process (read: not FTP), and some sort of project management tool and/or ticketing system. Projects that have lacked these systems have been more challenging, and these days I tend not to accept them.

Don’t Accept Abuse

There are terrible clients out there, but you do not have to work for them. If a client is impossible despite your best efforts to improve the situation, quit in a professional manner but without remorse. The client is not always right. You will find more work from someone better. Every. Single. Time.

Ignore the Economy

One question that’s come up a lot is how I think the economy has affected my ability to find work. Lehman Brothers would declare bankruptcy less than two months after I lost my job; the Dow would lose 3,000 points in the following weeks. My general theory on the economy question is this: rarely is full-time employment of a web worker an efficient distribution of labor, unless you are working for a very, very large company. The volume of work can fluctuate tremendously. I think of all the hours at previous jobs when there was literally nothing to do, yet the companies kept me around for the moment when there was. This was dumb. I’d like to think that as companies are looking for ways to cut costs, they’ll realize that was dumb, and bring people on as needed. The flip side of that is that those displaced workers are now competing for the consulting work. In the end, I think the economy may be a bit of a wash if you’re good at what you do.

Get Support

This feels like the single most discouraging thing I have to tell people: I am not sure I could have done this without the knowledge that the bills would still get paid if I failed. Our double-income-no-kids salary is embarrassing, but we were very intentional when we bought our house that we wouldn’t take on more than we could afford with one salary, no matter what the lenders told us we could have. My partner’s employer allowed me to enroll in their insurance coverage almost as if I were her spouse (I had to wait a few months for open enrollment, costly months I wouldn’t have had to wait if we were married). The comfort of this knowledge has been amazing, in those first few months when it became clear that I just might not need a job and in those dark months when it’s been unclear where the next check would come from. I am sure working for yourself is possible without these stars aligning, but it would require a braver soul than me.

Practical Matters

Have Clear Payment Terms (and realistic expectations)

I learned early on that I can’t expect anything quicker than Net 30, and that’s a long time — as much as 60 days after I did the work, assuming I bill monthly. One client failed to pay due to some issues with their accounting department, and it got to the point where I had to let them know that I couldn’t continue working with them until I got paid. A deadline was looming; a check arrived FedEx the next day. Be clear about your payment terms. You’ll get Net 15 if you’re lucky; Net 30 is standard. Incentivize them with late penalties if you need, and don’t hesitate to contact a client once that deadline passes.

Decide What You’re Worth

Honestly evaluate what your fee system should be, then stick to it. People who want to pay you less will cause other headaches that will make you wish you’d charged them more without fail. If you enter into any retainer situations, make sure the terms are crystal clear to both sides. Generally retainers work where the client purchases a minimum number of hours per month (potentially in exchange for a bulk discount). Communicate with them if they are not using their minimum hours, but try hard not to end up in a situation where you’ve cleared your plate for a client who then doesn’t need you as much as they thought they would. On the flip side, if the client has promised you 30 hours a week because they overestimated a task, but you’re so good the work is only taking you 15, make that very clear to the client and move toward arriving at a new arrangement quickly. They’ll appreciate your honesty, and you can free up your time for other work.

Decide How Much You Want to Work

Be clear about your availability if it’s not 24/7. Let clients know what the best way is to contact you. For me, for example, I hate being interrupted by phone calls, and greatly prefer IM over email for quick exchanges. I’ve learned to tell my clients this up front. For your own sanity, contemplate whether there’s a minimum number of hours you’re willing to work on a project. Too many times I’ve spent more time discussing a project than actually doing it. Make sure you account for that discussion time, and for the cost of getting you to sit at your computer rather than playing outside.

Get an Accountant

If you find yourself making any money at all, get an accountant. Taxes are complicated for self-employment. April 15 will either suck or it will suck a whole lot. An accountant will help you figure out estimated payments and advise you on the best way to keep as much of your money as you can. For me, that meant forming an LLC, which meant a lot more paperwork throughout the year, but a lot more money in my pocket at the end of it.

So, Go!

This working for yourself thing is hard. It’s so very important to be good at what you do, and yet being good at what you do has so little to do with being able to pull off working for yourself. On one level, I wish more people would do it — I believe it achieves a far more efficient distribution of skills and labor while allowing for some serious specialization. On the other hand, the instability of it ranges from mildly uncomfortable to downright terrifying, and so reality dictates that most people will wander back to the full-time world soon enough, and the independent thing will be but a blip on the resume. I, though, feel lucky I’ve made it this long.