[tptacek]

If there is a list of annoying false things technology people believe about business, this notion that bill rates track technical ability would have to be near the top of it.

Your rate has almost nothing to do with how good a programmer you are. Sorry, excellent programmers who've had a hard time getting consultancies launched.

Your bill rate roughly† tracks how much value you provide to your client. "Value" is complicated and situational. For programming work, for most clients, extreme technical excellence is of marginal value. Clients that engage third party developers tend to see software as a cost center and/or are simply trying to solve a business problem. They care about how quickly that problem can be workably solved, and (please take notes:) how predictable the costs are.

You can be thoroughly mediocre at programming and an excellent business value, if your mediocre code solves business problems people will allocate budget for and if you can deliver it predictably. If you can deliver predictably and fast, you can ship bog-standard PHP code and charge integer multiples of what a much better developer might implement in Rust or Haskell.

The market tends to pay a premium for problem domain specialization, and less of a premium for elite skill.

None of this much matters for someone just getting their feet wet trying to get their first couple clients. Do whatever gets you started. But get out of the habit of convincing yourself that you have to qualify somehow to charge more money. Even the consultants who are constantly telling people to raise their rates are also not charging enough. I'm a varsity member of team "raise your rates" and I thought we were undercharging 4 years ago. Since then, FTE rates have gone through the ceiling and our rates have not scaled with them. It is very unlikely that any consultant chatting about consulting on HN is charging their real market rate.

I have one bit of bad news for you: if you want to make a career out of being a contractor or consultant, you need to get off freelancing sites ASAP. It's fine to get started there, but you're not developing your practice in any meaningful way as long as you're using them; you're just getting better at slinging code (which doesn't earn you better rates!), while radically undercharging clients. Getting off freelancing sites is rough, because freelancing sites tend to provide a comparatively stable revenue stream, and real consulting revenue is lumpy. If you've never experienced "lumpy" before: it's (a) terrifying and (b) really easy to screw up, by assuming you're flush with cash when really you've effectively just been pre-paid for the next N quarters.

Some people reasonably don't want to work under lumpy consulting conditions. Better you figure that problem out for yourself early rather than wasting your time pretending, or, worse, forgoing a fuckload of income by chaining yourself to freelance sites.

† Roughly because most serious clients allocate a budget that establishes a range of what they're willing to pay to solve a problem, and an invisible component of that budget is how much work they're willing to put in to sourcing a contractor --- the first credible contractor they talk to might win the deal, meaning there's no competition to aid price discovery. Corollary: one way to "provide value" and charge a premium is to be easy to source. Something that people who build consulting firms, the kind with lots of consultants, learn quickly: clients put a premium on firms that are always available.

[csomar]

Thomas, you talk a lot about raising your rates and I believe your points are valid.

How do you go (being completely remote) from nothing to have a high quality client (as in corp/high net startup).

Take these into consideration:

- Can live off savings for the next 2 years.

- Can expense 3/4 travel costs for US/EU/Asia.

- Can setup offshore US/HK company and bank accounts.

- Doesn't mind if the process take 2-4-6-8 months.

- Doesn't mind traveling, staying late, taking calls anytime, etc.. if it can give me an edge.

What are the steps to take to land the first whale. Also, I have the following skills: Cryptography/Security (still a beginner), Blockchain (somewhat good), DevOps (medium), Web Development (Pretty good experience).

Bear in mind pretty much most of my clients before were low quality clients (making wordpress sites for the average business, made me decent money but only for the cheapness of the country I live in).

Would appreciate any advice!

[patio11]

In parallel:

1) Produce publicly visible artifacts which demonstrate that you're able to apply technology to impact business outcomes. You do not need many of these; ~3 is fine. You do not need to block on the other steps. You do need to plausibly connect the technology to a business outcome; blockchain and beginner-level cryptography probably do not get you there.

2) Begin getting into conversations with people who either a) have purchasing authority or b) talk to people with purchasing authority, at your target clients or firms very similar to them. This can be as simple as bonding over technical things with technical people. You want to become Internet buddies with e.g. senior engineers / team leads / etc at software companies.

3) Walk the network of your new friends to engagements, either at their firms or peer firms. Do not make another WordPress site for the average business; make something for a software company.

4) For every engagement you land, attempt to get referrals to more clients, attempt to land follow-on work with the same client, and attempt to land ongoing maintenance/retainer/etc agreements with the client.

And then: https://news.ycombinator.com/item?id=4247615

[csomar]

1) How can I find out what to build if I don't have any significant corporate experience. I don't necessary like to work for software companies but I just have no clues of what "sells". (That is on a corporate level. Both services and products).

2) How do I get into conversations with decision makers? Cold approaches? I know I'm a decision maker for buying a sofa for my living room. But I get to discuss with the seller because I'm in his shop? How do I get to discuss with him if he doesn't have that shop to trap me there.

[barry-cotter]

If you like podcasts, there’s a great one by Kai Davis and Nick Disabato called Make Money Online. I can also recommend the Indiehackers podcast. The greatest insight to effort would probably be The Personal MBA by Josh Kauffman, a really great business book. What sells is solving expensive problems or making companies with lots of money better or more efficient at making money. You can get into conversations with decision makers by cold emailing people saying that you’d like to buy them coffee and talk about their business. Lots of them are busy and will not reply or say no. Some will say yes. These are informational interviews not sales calls because you don’t have anything to sell yet. Or you could go to your local chamber of commerce meeting and talk to people.

One recent Indie Hackers episode had Nathan Barry on. He swore by the tactic of doing presentations on a topic that would be useful to small business owners at chamber of commerce meetings, collecting emails and adding people to a mailing list. Apparently most of the leads he got didn’t convert themselves but they referred other people who did. All for the price of free coffee and donuts, a presentation and time.

[eldavido]

I would go farther and say that rates are uncorrelated to skill. Like actually zero.

Rates have much more to do with how in-demand the provider is relative to their ability to deliver. And a big part of "in-demand" has to do with how you market yourself, the quality of your network, and other non-work product factors.