[sanderjd]

This is why the word "underpriced" always seems wrong to me in this context. Your price at the beginning has to be lower because your profile is lower, which means you have a weaker negotiating position. "Underpriced" only becomes the right word if your rates aren't rising in conjunction with your profile, which does happen for sure, but isn't the case right at the beginning.

[tertius]

"Your price at the beginning has to be lower because your profile is lower"

This is the sentiment that makes you justify charging too little.

[sanderjd]

So, to relate this back to the original article – all these people interviewed started with low prices at the beginning and built up their profile, raising their rates along the way. I look at that and think, well that's a good and clearly proven model, and it makes sense why it works that way. I don't look at it and think, well they should have started out with higher prices right from the start, since clearly they were worth it all along!

[tertius]

"I don't look at it and think, well they should have started out with higher prices right from the start, since clearly they were worth it all along!"

Emphasis on "too little" in my comment leading up to your reply.

And it's not about what they are worth it's about what the solution is worth to the person buying. Almost always more than the developer/worker thinks their time is worth.

[mcintyre1994]

So what is the alternative? If you don't have any cheap clients (cheap labour) or portfolio (free labour), how do you convince clients what you're worth?

[mgkimsal]

Arguably, you can invest some of your time in your own portfolio projects that demonstrate the particular skills and value you want to promote. It's not an exact science, and harder in some industries than others, but not impossible, and it's something that too many folks (me included) tend to gloss over or ignore.

Keeping a relevant industry-related blog won't necessarily convince every single client, but it's one of those things that can swing someone's mind to committing to you when there's not a lot of other obvious signals.

[sanderjd]

Why is it better to do free work to build a portfolio of non-professional work, rather than building it by starting with lower-paying engagements?

[mgkimsal]

HeyLaughingBoy nailed it, but there's another couple of points that got missed in the replies/discussion.

1. It's not "free work", it's just ... stuff you do. Maybe you release it out and other people benefit from it, maybe you just do it to demonstrate skills.

2. Per #1, you get to demonstrate whatever you want to learn. Do you want to learn how to use Twilio APIs? You could wait for a client engagement that might need Twilio, or you could try to force Twilio in to a client project where it's not needed, or you could... just play with Twilio, produce something demonstrable, and use that to show what you know about using Twilio. It's great when you can show your skills having real value to real past client projects, but absent that demonstration and experience, you'll be experimenting on your new clients to a degree. Learning on your own dime (and time) can also inspire a degree of confidence that you actually know XYZ before you're engaged to do XYZ.

[tertius]

When you build your client base and you start off by charging a low price, any referral work you get (and it gets to be a large portion of your work as the base grows) will have a harder time with raised rates.

The underlying psychology shows us that we undervalue ourselves whereas other people tend not to since they view us as experts. They are generally willing to pay a lot more to have a solved problem than we would want to charge.

Start high and go higher until you meet resistance.

[sanderjd]

> any referral work you get … will have a harder time with raised rates.

This does not seem to mesh with the posted article where they interviewed lots of successful people who started out charging on the low side and were able to aggressively increase over time.

I get what you're saying in this thread, that people tend to not charge enough. Sure, I'm right there with you. What bugs me is this meme that seems to suggest that there's something wrong with doing whatever you can (like charging less) to get your foot in the door. It's intimidating.

[HeyLaughingBoy]

It's not that it's better, but it can be done independently of anything else. i.e., the only thing stopping you from starting to build a "non-professional" portfolio this very minute is time availability.

But you need a history of engagements to build a client portfolio.

[gexla]

Notice some say they started out at less than $25 an hour. Others started out at $50 or more. The difference isn't in profile, it's in what they were asking when they got that first client.

[sanderjd]

Definitely true, but also note that none of them started at anything we would consider to be "a lot".

[jayshahtx]

I agree with you, but when we are discussing "price", we are not discussing it as a function of profile. We are discussing it as a function of raw skill. If two people (one experienced and one in-experienced) were asked for a proposal on the same specs, the experienced one would demand a much higher rate, even if the final output would be the exact same. Using the word "underpriced" from the lens of competency makes sense. Your ability to gain trust/respect from a client? Different story..

[cstavish]

To play devil's advocate: hiring a less-experienced freelancer is a riskier investment than hiring an experienced freelancer with a big portfolio and many references. Even if the two candidates are of equal skill, the hiring party can't know that. Thus, price is a function of what you can reasonably expect to get from a candidate.

Being an inexperienced freelancer is akin to being a borrower with an under-established credit rating. Regardless of whether the borrower is sitting on a mattress full of millions, he or she will still pay higher interest rates until his or her credit is better established.

[sanderjd]

I guess I just don't think that's a very realistic view of "price". Nothing is priced based on innate value, but rather a complex interaction between value and the ability to market that value.

[imgabe]

It has to be lower, but you don't know how much lower. It's probably not as much lower as you think. If they would have paid more, you didn't charge enough. Obviously it's hard to know that at the beginning.

[sanderjd]

Spot on. Perhaps best to try starting higher than you think and slowly lower until you start getting gigs.