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Ask HN: When to make the jump to freelance/consultant?

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Ask HN: When to make the jump to freelance/consultant?

#1

Post by mxmpawn »

I'm working full time as a data engineer/scientist but I also have one ongoing customer (a previous employer).

Another previous employer is launching a startup and has recently pinged me because they need to build a series of data pipelines and ML models for their product.

I've to talk to them about specifics but I don't see myselft having enough available time to make it work.

I've been thinking about starting my own data/ml services company for a while but I don't really know when to make the jump. I think (is a guess for the time being) that the income from this new job, in addition to the income of my current client, could be enough for my living expenses of this year, so I'm thinking if this is a good time to make the jump or not.

The problem that I see is that this new lead is from a previous partner of my current client, so both jobs are related to my previous employer, I don't have a pipeline of possible prospects for my service, so I'm not sure if I'll be able to generate a pool of prospects while doing the work for this customers.

My guess is that I should wait until there is a sign that I could probably get a stream of clients to keep the wheel going, and try to find the time to take this new job, maybe negotiating terms to make it possible.

What do you think?

Edit: I've savings already as I plan to buy a new home (I'm in Argentina, we buy it cash, no mortgage). I need three more months of salary to accomplish the home budget.

Re: Ask HN: When to make the jump to freelance/consultant?

#3

Post by fhd2 »

I personally took the plunge, with enough savings to make it several months until the first invoice is paid. Some clients pay on time, some don't, some go bankrupt or just drag it out infinitely, from what I've seen.

Without that kind of savings (and being comfortable with watching them meld away for a while, taking the risk that you might not recover them), I would suggest to try to find a safe way to experiment with this. For example reducing your hours, or taking on a new main job with less hours, and taking on part time freelance work. Maybe there are things you can do for your potential clients with less hours than what you/they think is needed.

Re: Ask HN: When to make the jump to freelance/consultant?

#4

Post by physcab »

If you have enough connections to get you through your first 6 months or so then you can make the jump. Often when consulting your rate is double your normal take home so it balances out the period of searching for more work. But you highlighted the key anxiety in going freelance: you will always have to be selling your services. Its just like any startup except you are the product. Having to get new gigs will always be part of the job whether its now, 6 months from now, or 3 years from now

Re: Ask HN: When to make the jump to freelance/consultant?

#5

Post by sjducb »

It sounds like the perfect time to jump to freelance. You've got 2 clients already.

However... What happens if both clients back out and you suddenly get no work for a year? Do you have 1 year of savings runway? Will your family and living situation survive no income for a year? You need at least a year of runway because it's perfectly normal to go for 2 months with no income and if you've only got 3 months of savings then you'll start panicking.

Also getting a mortgage as a freelancer is more complicated. Have you bought all of the houses you want for the next 2 years? (Freelancer mortgages require 2 years of company accounts, so you won't be able to get a mortgage for the next 2 years)

Re: Ask HN: When to make the jump to freelance/consultant?

#6

Post by nocubicles »

I just started this today actually. Today is the first day where I am no longer employeed by any company and will need to find my own customers, invoice them etc. My field is ERP development and consultation.

I have 10+ years experience in the field and I was working for a consultation company. But on the same time I would always get messages on Linkedin from recruiters and at some point I thought I should give it a go and try to work on the projects during the nights and weekends.

Did that for like 6 months and felt I could do it full time and then I just kinda did it and will be doing it in the future.

Re: Ask HN: When to make the jump to freelance/consultant?

#8

Post by choult »

I started on my own at the end of September; I'd resigned my job at Datto after an acquisition proved itself disastrous (never work for Kaseya, or any Insight Partners portfolio company), and the position I had lined up fell through for one reason or another.

I figured - I'm 40, I've always wanted to do my own thing, I've got runway... Why not? So I formed a company[0], started planning out a B2B product and networking like crazy; I'm fortunate to have a wide diaspora of former colleagues.

As I want to bootstrap my own SaaS app, I needed to get revenue coming in, so I began to offer my services on a consultancy basis. I got my first small customer at the end of November - a charity needing hosting and maintenance - and then landed my first major consulting gig at the end of December 2022.

Who knows what I'll be doing in a month's time, but I know that I can build a track record of helping others, and it's so varied! Every business or organization I talk to gives me more ideas for my app, so it's also a great way to collect more knowledge about the wants and needs of my potential customers.

If you have the opportunity and runway to give it a shot, I'd recommend trying it - put a plan together for how you'll achieve it, how long you can last without a gig and what you'll offer others. And then execute on it.

You'll never know unless you try.

[0] https://xarma.co

Re: Ask HN: When to make the jump to freelance/consultant?

#9

Post by cableshaft »

nocubicles wrote: post #6

I just started this today actually. Today is the first day where I am no longer employeed by any company and will need to find my own customers, invoice them etc. My field is ERP development and consultation. I have 10+ years experience in the field and I was working for a consultation company. But on the same time I would always get messages on Linkedin from recruiters and at some point I thought I should give it a…

Sounds like you got freelance work from recruiters contacting you for full-time job opportunities. How did you ask them about that, out of curiosity?

Re: Ask HN: When to make the jump to freelance/consultant?

#10

Post by simne »

You should consider two most important things (unfortunately, each other opposite):

1. Yes, better to start own business when favorable environment, for example, when see macroeconomic grow (now recession, and high probability of crisis), or when You have some money accumulation.

2. But business is by definition, PRACTICE of make stakes and earn profits on success.

- You will not practice if not try. And best practice at crisis.

Exist good solution of this contradiction. If You could afford it, look out at nearest to You business community (offline), and find experienced mentor, to mentor You and You'll pay him from Your current payment.

Any way, early start business is much better then late. Mostly, because when You younger, You have more health, and could do things faster.

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