[alexwyser]

I could always make designs for 'hypothetical companies' but I felt that it'd be more worthwhile if some startup could benefit from my designs at the same time.

Plus it gives me the experience of working with clients, as well as some exposure.

[byoung2]

One technique I had success with when I was freelancing is designing on spec. Find a genre of business and look for bad websites. Restaurants and hair salons are good for this because there are usually really good ones, and really bad ones. Redesign one of the sites, using the content from the site (menus, directions, about us, etc). Then contact the business, and offer to sell them the site. Send them examples of their competitors' sites (the good ones) as leverage. If they don't go for it, you can easily swap out the content with another business in the same genre. You can repeat this several times, and when you are done, you'll have a nice portfolio, and several paying customers.