Mastering Freelancing: Strategies for Sustainable Success
Written on
Chapter 1: The Freelancing Dilemma
When it comes to freelancing, many seasoned professionals might suggest steering clear of freelance platforms entirely. Personally, I hold a more balanced view. While relying exclusively on marketplaces like Upwork isn't the best strategy for maintaining a freelance career, these platforms can provide valuable experience and serve as a quick source of income during lean times.
Landing your initial client on a freelance site can be a practical choice. My first contract originated on Upwork after a client discovered my profile through LinkedIn, thanks to my former manager's recommendation. For several months, I operated exclusively through the platform and even attained Top Rated status. However, my financial situation began to improve significantly only after I moved away from the platform.
The Risks of Relying on Freelance Marketplaces
Numerous freelance platforms exist, including Upwork, Fiverr, Toptal, and Freelancer, making it clear there are plenty of options available. Their main allure lies in simplifying client connections, allowing you to focus on your skills.
However, experienced freelancers argue that these platforms create dependency by alleviating one of the most challenging aspects of freelancing: marketing. While they do lessen the marketing burden, becoming overly reliant on them can be harmful.
Here are some immediate concerns to consider:
Loss of Control
Ultimately, these are third-party platforms. You have no authority over them, and if they encounter issues, you could lose your primary source of income and your clients. Additionally, you're often restricted by platform rules, such as not being able to share contact information with clients.
Difficulty Standing Out
While freelance platforms allow you to create a detailed profile, they offer similar templates to every other freelancer. This uniformity makes it challenging to differentiate yourself, especially if you lack a strong track record.
Vulnerability to Algorithms
Freelance platforms utilize algorithms to rank freelancers during client searches. This means you’ll face stiff competition, which puts your success rate at the mercy of these algorithms.
Price Competition
With numerous candidates available, clients often opt for the lowest bids. Freelancers typically undercut one another to secure jobs, which can lead to artificially low pricing that fails to reflect the true value of the work.
Brokerage Fees
To sustain operations, these platforms charge fees, which can fluctuate. During my time on Upwork, I lost 20% of my earnings for new clients, meaning a $200 contract only netted me $160 after fees. As I continued working, the fees eventually decreased to 10%, but I still had to exert considerable effort to earn a reasonable income.
A More Effective Approach to Client Acquisition
Sara Horowitz, founder of the Freelancers Union, offers insightful advice in her book, "The Freelancer's Bible." One key takeaway is to view your client portfolio similarly to a financial portfolio.
"A Freelance Portfolio is akin to a financial portfolio. Just as investors diversify their assets to maximize returns while mitigating risks, freelancers should consider the impact of each client on their overall stability and income."
— Horowitz, S., Page 75. The Freelancer's Bible.
This perspective encourages freelancers to evaluate how each client influences their risk and reward profile. Horowitz outlines four categories for assessing your client portfolio, which we will refer to for clarity:
Section 1.1: Blue Chip Clients
Blue-chip clients form the foundation of your freelance portfolio. In financial terms, these are reputable companies known for their reliability and stability. As freelancers, these clients serve as anchors, providing consistent income and protecting you against market fluctuations.
It's essential to maintain good relationships with these clients, as they are likely to refer you to others. However, it's crucial to establish boundaries and not tolerate poor behavior.
A valuable tip is to cultivate multiple blue-chip clients, as relying on a single client can be risky.
Subsection 1.1.1: Growth Investments
While blue-chip clients offer stability, they can also lead to complacency. To remain agile, freelancers should actively seek growth investment clients. These clients may not be as stable but can be more plentiful and help diversify your income.
Finding these clients often comes through referrals or proactive networking. Setting competitive prices can attract the right opportunities while filtering out low-paying projects.
Section 1.2: Short-Term and Long-Term Clients
Freelance marketplaces are often where many freelancers find themselves trapped in short-term gigs. Relying on these one-off projects for income can be precarious.
"Independent contractors post their profiles while work providers post their projects; ideally, both parties benefit, with the platform facilitating the transaction for a fee."
— Horowitz, S., Page 84. The Freelancers Bible.
These clients can provide fast cash or experience, but spending too much time pursuing them is counterproductive. Think of it like dating; it’s easy to get caught up in the process, but quality connections are far more beneficial than sheer quantity.
Section 1.3: New Ventures and Long-Term Growth
Building something meaningful takes time. Whether it’s a product, service, or collaborative effort, focus on long-term profitability.
For me, platforms like Medium have been instrumental in this pursuit. Other options could include writing a book, public speaking, or creating online courses. However, it's vital to ensure that these ventures do not interfere with your primary income-generating activities.
Thank you for reading.
If you're not yet a member, subscribe to stay updated on my latest insights.