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

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

#51

Post by sirsinsalot »

aantix wrote: post #36
sirsinsalot wrote: post #29

15 year+ consultant through my own company with recurring clients and more work than I can handle (and no interest in delegating or growing) Never needed to network. Don't have to market myself. Never had or needed a full time position and never been short of work. Get to know good recruiters who have streams of contract work with goal based outcomes. Learn how the contracts are managed by middle men and understand w…

Why work with recruiters at all? They’ll charge 30-50% over your rate. They provide zero value besides the initial contact. Their overhead impacts your negotiation leverage for a higher rate.

Recruiters here typically take 10-15% and I don't care as long as I'm getting what I want in revenue.

Most recruiters are absolute snakes. They can be very useful and you don't have to let them negotiate for you.

At the end of the day, as long as they get their cut they don't much care.

Saves me endless hours at $X/hr searching myself. It's more cost effective for me to bill a client for those hours than market myself.

If you know the industry and find good recruiters they'll break their back to place you.

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

#52

Post by sirsinsalot »

Nextgrid wrote: post #40
moneywoes wrote: post #30

Earlier quoted context omitted.

Where do you find these roles

Seconded. The vast majority of contract roles I see here in the UK are brokered by recruiters who will enforce their own standard contract terms & rates on a take-it-or-leave-it basis. This kind of approach seems like it has no chance of working as the recruiter would rather place someone at an "okay" rate rather than having to risk submitting a higher-rate candidate and having the client balk and go away altogether.

Yes recruiters, and outside IR35.

It isn't true that they set rates and dictate terms. Push back, negotiate with them.

If you have recruiters who know you deliver, which drives more business for them and makes them look good, they'll listen to you and break their backs to place you even at rates higher than other people. They become your marketing team.

They're salespeople. Make their job easy and make yourself a tool that generates more long term commission for them. They'll bank on you and you'll be first in line.

All they care about is an easy win and their commission and sales targets. If you're their easy win, you're golden. The higher the rate they can place you at the more it works for them because the commission is percentile.

I interview really well. I'm a salesman too. They know if they can get me in the door I'll get the gig and they can get their cut of 50% above market rate.

I get to strike terms from contracts, set my notice period ... whatever I want really.

Build the relationships.

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

#53

Post by ernestipark »

How much work do you think the new work would take? Depending on the nature of the engagement, it doesn't have to be a 'jump' at all. If possible, an option would be to make it a more reduced hours engagement that you can moonlight. Then you can get the consulting experience, maintain the income of your full-time job, and see how it goes. Once you have one engagement under your belt, then it also becomes much easier to get more through WOM and very basic marketing/promotion through LinkedIn on what your skills are and what you can offer.

As others have stated in the comments also, a lot of consultants never have to do marketing or sales, they just get it word of mouth through their networks as they continue to do good work. I think doing that first job well, but in a way that's not as scary as jumping away from your full-time job is a good choice if you have it.

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

#54

Post by sirsinsalot »

benjaminwootton wrote: post #44
aantix wrote: post #36

Earlier quoted context omitted.

Why work with recruiters at all? They’ll charge 30-50% over your rate. They provide zero value besides the initial contact. Their overhead impacts your negotiation leverage for a higher rate.

Recruiters typically charge approximately 10% in the markets I am familiar with. They also act as a free sales force and have supplier agreements with end clients. These are very hard to secure directly for one man bands. I would argue that it's not really consulting or running your own business if you are working through a recruiter. It's more akin to short term employment. That may be fine for your aims however.

Recruiters are also an insurance policy for clients. They mitigate some risk.

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

#55

Post by dadro »

eddsh1994 wrote: post #37
dadro wrote: post #18

Every scenario is going to be different, I took the plunge as a software consultant and can provide some datapoints. I was laid off from my job as a software engineer about 5 years ago. I had previously worked in software consulting and knew the operating model and had a handful of potential clients. I had some savings and my wife works full time so I decided to give it a go for 6 months to see how it would go. I par…

How many years experience did you have? :)

I had about 15 years professional experience as a developer.

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

#56

Post by wpietri »

My general answer for people asking this question is: when you think you can sustain yourself. And it sounds like you're almost there.

It sounds like the question for you is whether you can find new clients at a rate fast enough to replace old ones. This is a question you'll never be able to answer fully as an employee, because employers generally don't like you putting out an "open for business" sign. So in your shoes I'd put together a marketing/sales plan, take the new customer, and devote some time over the next N months to seeing if you can build up enough interest and leads that you will have plenty of work down the road.

It sounds like the worst case here is that you get to the end of your contracts and have to go get another job again. Which is not a terrible outcome as long as you don't burn your bridges. And it's worth noting that after a period of freelancing you may decide you'd rather have a job anyhow, so you can look at the next months/years as an experiment not just on prospects, but on whether or not you will be happy with it.

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

#57

Post by jokethrowaway »

Oh that's easy, wait the 3 months and then quit. Subcontract out among your friends to make up for the immediate work you can't take right now.

Spend an afternoon to setup some branding for you data/ml company and when dealing with customers, mention you're a company and that they're not just hiring one guy but that one of the team will handle it.

I'm in a similar position. I'm saving money to build my house, I don't want to quit my main gig just yet and I'm trying to ramp up an agency doing mostly web development and I had good results offloading part of the work to other people. Learning to rely on external resources is crucial if you want to scale your business.

Best of luck!

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

#58

Post by jokethrowaway »

sirsinsalot wrote: post #28
xeromal wrote: post #25

One element required is to have a network big enough to sustain itself off recommendations. I think that's absolutely necessary at least for 80% of your business revenue. If you're just hopping from one client to the next, you're not going to be in a strong decision to make good choices for your company when it comes to negotiations.

I've been a consultant through my own company for 15 years and never needed to do this. I simply apply for contract roles. My day rate is 150+% of the average for my role and area and my contract terms are ridiculously weighted in my favor. You can learn to negotiate going from one client to the next. And you mainly have to be able to negotiate better than the client. That's pretty easy usually.

Offers through my network always outperformed recruiters in my experience. It makes sense considering a recruiter would charge 10-20% of the contract.

I'm friend with recruiters and I add everyone on Linkedin so I can just log in that horrible spam infested thing that is my Linkedin feed & private messages and get an idea of what rates are going in market.

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

#59

Post by yellowapple »

MuffinFlavored wrote: post #45
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…

how different are WMS and ERP?

An ERP often includes (some approximation of) a WMS (usually as an addon or module or such), but usually not the other way around. There's usually overlap (like inventory and order management), but a typical ERP doesn't handle the minutiae of receiving/picking/packing/shipping like a WMS does (and when an ERP does attempt those things, it's rarely done well - though to be fair there are about as many shitty standalone WMS implementations as there are shitty WMS-as-ERP-addon implementations).

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

#60

Post by Dayshine »

sirsinsalot wrote: post #51
aantix wrote: post #36

Earlier quoted context omitted.

Why work with recruiters at all? They’ll charge 30-50% over your rate. They provide zero value besides the initial contact. Their overhead impacts your negotiation leverage for a higher rate.

Recruiters here typically take 10-15% and I don't care as long as I'm getting what I want in revenue. Most recruiters are absolute snakes. They can be very useful and you don't have to let them negotiate for you. At the end of the day, as long as they get their cut they don't much care. Saves me endless hours at $X/hr searching myself. It's more cost effective for me to bill a client for those hours than market mysel…

How long are the contracts you're finding? And are you doing multiple at once? In the UK I struggle to see any contracting less than full time and six months. At which point, without annual leave, it feels like a much worse deal than an 0.8 FTE remote job.
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