[bigmanwalter]

Welcome to the dark side :)

Starting a services firm is all about building up a client base that can sustain you. Your big challenge is to get into the best referral circles, as the best projects come via word of mouth.

My suggestion is to take whatever you can get at first. Take as many coffee meetings as possible and network like crazy. You never know where your first big lead will come from.

Expect most potential clients to be sceptical of your ability to deliver until you have portfolio pieces that are of both a similar level of complexity to the clients' needs as well as written in similar technologies. Clients will be sceptical of anything that you wrote while still employed unfortunately.

For me, this meant that I had to take projects at a loss or on razor thin margins at the beginning. I was strategic about it though and this allowed me to build up the type of portfolio I needed to get my ideal contracts.

Online markets are very competitive. Expect to be up against 200 other bidders. It can be fruitful, but I consider it to be a full time job in itself.

Until you're established, you'll need to follow up on every potential sales channel you can think of. If you have sufficient capital to float sales people, it's always a great thing to have, but be careful as employees will spend your money faster than you make it at first. Contractors, freelancers, and commission only sales can help you out here.

I found most of my first clients by announcing my availability to my network. There may be some less saturated job boards on Facebook that are localized to your specific city as well.

You may need to take on smaller projects than you would like at first. It will feel useless but it is actually valuable networking. Some of my 1 day projects have turned into handsome referrals :)

Get as much mentorship and help as you can find. There will be hard times before the operation is running smoothly.

If you ever want to chat about it, you can hit me up at [e-mail]

[Jhsto]

I recently started freelancing after moving out from Bay Area to a different continent. I used to network a lot in Bay Area and thus I have had good luck finding people who would be interested in my services. However, I have needed to turn down potential clients because they have essentially said that they would like to hire me as an employee. I am young and it seems like most companies are looking to hire me in order to comb me into something useful for them.

Most people here tend to be parallel entrepreneurs rather than serial ones -- they have a half of a dozen projects going on at the same time. For this reason, I would not want to commit to a project to which even the CEO does not seem to have much time for. Some companies also seem to lack the much-spoken thing in Bay Area of product and/or market focus, which would make my role ubiquitous, which is not what I want. Although, because of my young age and mainly software expertise, I don't want to directly say that I think their way of running the business is bad. I do think that most of the companies are able to make it into a profitable business, but for me to engage into payroll positions, I would want something riskier than that.

Have you found the same kind of struggles early into your service firm? Would you have any tips on how to pitch these companies into buying what they want as contract work instead of hiring me as an employee? Any nice way to tell these people that I don't believe in the way they are running the business?

[bigmanwalter]

I encounter this situation constantly. The economics of outsourcing doesn't always work out for every project. As a consultant, you'll be charging 2-3x the hourly rate of an employee, and the company is giving up the benefit of having in-house expertise on their own product.

If you're okay with working for one client full time for the duration of a contract, my advice would be to work with a few recruiters. They'll take a 30% cut, but as they know about some of the best contracts it is often worth your while. Their clients are using contractors to deal with spikes in their workload, or for projects where they don't expect to need you in 6 months.

Another route is in finding clients who want you to manage the full project. Things like building MVPs or building Version 1 of an app. Usually they have a limited budget and aren't looking to take on the risk of an employee. These clients don't generally have any in-house technical expertise. In order to bag this type of client, I have found that having a solid project template to work from and speed up development is a must. It took me almost 2 months to fully set up my build pipeline and get a start project up and running just the way I like it (don't hate my just because I'm a perfectionist.) But now I can kick off projects with a running start. Deliver a fully functioning app in under a week, albeit with only the first couple features, and your client will be happy to pay your rate for the duration of the project.

Finally, the last route I know of is to specialize in a hot technology. AngularJS seems to be popular in my area. A lot projects were started with the thinking that Angular would do all the hard work for them, and now they are neck deep in spaghetti written by a junior. If you can market yourself as an Angular expert, they will be willing to pay higher rates as well as put up with the fact you aren't sticking around. But you need to have a hard-to-find talent for this power dynamic to exist. A friend of mine is a Haskell freelancer and finds it gives him good leverage.