Ask HN: What mistakes did you make when starting as a consultant/freelancer?

I can second this piece of advice. When I first started our small consulting firm we didn't know how to scope explicitly enough and didn't charge enough even if the projects did stay within the scope of work.

Don't be embarrassed of your rates. If they're flirting with but not plainly past what potential clients are willing to pay, you're in/around the right territory. Additionally, explicitly the definition of successful deliverables in your SOWs - make sure that you get enthusiastic client sign-off on these criteria. This can only serve to make everyone better off when work is marked as complete.

Last, "Due on Receipt" with some understanding and grace is a lot better than having to send "Hey just wanted to check in about invoice #1113" emails 10 days after your 30-day receivables haven't come in.

I run a small consulting firm in the United States - you can definitely goose dollars-in-pocket based on your type of consulting and other arrangements.

Imagine that I run two firms - one that provides primary top-level advice, guidance, etc. here in the states, and with the other doing some or all of the implementation work in a U.S. territory like Puerto Rico. Much of the profits can end up in PR, and when your continental entity needs cash it can borrow it from your PR-entity at a decent interest rate to further reduce states-based taxable income. You don't really even need to be a citizen of PR for that to begin working. That's one of innumerable ways to reduce your tax burden here. An ambitious accounting and legal team can help you ensure that you keep as much of your total billings as possible.

We don't do this - we're too small and due to ambitious growth we end up eating most or all of our earnings each year anyway. Definitely seen it before.

1) I thought that getting clients would be relatively easy, but getting new ones is more about trust than anything else. I moved back to my home town after spending two years away and noticed that my professional network there was quite poor so it took awhile to find a gig (~2 months and it's not in my home town).

2) When looking for opportunities (any kind really), the 80/20 rule applies. Try to focus on the 20% that produce 80% of the results. In our case we started by cold contacting, with quite poor results. Instead, we've been pretty successful using local freelancing networks/sites ran by larger consultancies to outsource the work they don't have the resources to do. Granted that's just subcontracting but it's a decent way to start out. I'd imagine the way the 80/20 rule applies when building direct client relationships is to focus on large-ish corporatios with decent financials that are already using contractors.

Agreed! And send the initial bill after the first week to familiarize the client with your invoicing process. (They typically appreciate this.)

I tried freelance and realized I hate it more than any other type of programming work.

I can tolerate being an employee where I do what I'm told. After a month I get a feel for the environment so it becomes low stress and then I can keep my head down programming. Or I can tolerate selling software or having a SaaS. If I'm CEO I decide the direction of the product and then just have to handle customer support.

But the BS and stress of dealing with clients, contracts, undefined specs and getting paid... I have no f-ing idea how people tolerate it. So good luck with that. It took me way too long to figure out that I absolutely hate working as a contractor.