With a better job market, tech professionals have more options and flexibility for work-including freelancing.
Then-freelance iOS developer Phil Scarfi had signed on to perform some contract work on a company's app. The feature updates were slated to take about 10 hours of work.
Around 25 hours of work later, Scarfi had perfected the feature. Due to 15 hours of going back and forth with the picky client and not getting paid hourly, the experienced iOS developer ended up making about $2 an hour, illustrating some of the common issues that plague those who make the leap to freelance.
With a strong tech job market, tech professionals have more flexibility in where and how they work—including freelancing.
"There is such high demand for niche or specialized resources right now and a very low supply," said Stephen Zafarino, senior director of recruiting for Mondo. "As a result, freelancers today can set higher rates and experience more stability with less time off between projects given the increase of available freelance projects in recent years."
Tech professionals have several motivations to work solo: More control, a wider range of clients and tasks, more flexible hours, and a potentially larger paycheck.
However, current and former freelancers say there are several things to consider before jumping ship and going solo. Here are eight things tech professionals should know before freelancing, according to the people who have been there.
SEE: Telecommuting policy (Tech Pro Research)
1. Insurance is now on you
Freelancers leave behind the security of being at a company—including health and liability insurance. You are responsible for covering risks yourself, according to Andy Wood, executive vice president of retail operations at Insureon.
The good news is that many types of insurance are relatively inexpensive, Wood said. Freelancers will most likely need general liability and health insurance. If they're dealing with sensitive data, they may also need cyber insurance.
Insurance should extend past a contract term in case an issue arises after the contract ends, Wood said. Sometimes new freelancers don't understand this, accidentally leaving themselves vulnerable, he said.
Additionally, look into incorporating your business into your plan, and having a lawyer on hand. Both can potentially save you money and time, freelancers said.
2. Track your money
Can you support your current lifestyle with the up-and-down income of freelancing? Since your income will not be on a set schedule like a company's payroll, budgeting is even more important to ensure the bills are paid.
Housekeeping extends into accounting. Tech professionals may need to invest in some form of an accounting system, which may bring along new expenses. Connect with an accountant and make sure you're following all state reporting laws.
3. Expect to put in more hours
Freelancing is not a cakewalk, Wood said, and often requires more hours than a typical full-time job.
But you can make those hours count. Liam Pedley, a freelance website designer, said he wished he would organize his daily schedule to maximize productivity. Having a home office ready to go is important to get work done.
A freelance developer said they wished they knew how to choose the right clients for their business. Some clients may not perfectly align with what your business does, potentially causing more trouble than they're worth.
4. Finding work can be tough
The more specialized your skill set is, the easier finding that work may be.
Some skills, like presentation creation, can be outsourced to other countries for much cheaper, according to Naresh Vissa, CEO of Krish Media & Marketing. Other skills, like computer programming and copywriting, are harder to outsource, which means freelancers are more likely to find jobs in those fields, Vissa said.
"You can find projects through referrals, through agencies like Mondo, or through job boards," Zafarino said. "Typically, the best bet is to go through an agency because they have connections with hiring managers at a wide array of organizations and have experience working directly with them, so they know what they are going to be looking for."
5. Keeping that work can be tough
Contractors can help companies cut costs, but as soon as the contract for that work ends, that relationship can end as well.
Compared to firing an employee, companies have fewer hoops to jump through when ending a relationship with a contractor.
"Failure is a part of any business," Vissa said. "As an independent, you will get fired. Contracts won't be renewed. Bridges will be burnt. That's all human nature. So get used to it."
6. Prepare to chase outstanding payments
You'll most likely have to track down clients for payments, tech PR consultant Monika Hathaway said.
"I had one month where every single client paid late and I had to scramble to figure out how to pay my vendors on time," Hathaway said.
Between attorney fees and the cost of possibly losing a relationship, there's little legal cover for freelancers when they aren't paid according to the terms of their contract, Hathaway said, so be prepared for a payment fight in some cases.
7. You need to develop and maintain an online presence
Having a respectable online presence can make the difference in a client trusting you and not hiring you, according to some freelancers.
"The first thing that most employers are going to do before hiring you is Google your name to do some light research and get a feel for your professional tech history," said Nate Masterson, digital marketing manager for Maple Holistics. "In this day and age, if the employer comes up dry when Googling your name, you're probably not going to get the job due to your competition in the freelance market."
Masterson recommends creating a business website, making professional contacts, and working towards several solid hits when someone searches your name.
8. Know your worth
Some clients won't pay, regardless of how low your pricing is, Accelerated Growth Marketing founder Stacy Caprio warned.
But for the cases where you don't want to work pro bono, knowing how to research rates and charge clients based on your skill set and experience is important.
"When I first began freelance writing, I worked for super low wages simply because I thought that freelancers were expected to do a ton of work with very little pay," said Stephanie Caudle, owner and founder of online freelance platform Black Girl Group. It's key to know your worth in your field compared to others.
- 10 signs that you aren't cut out to be a telecommuter (free PDF) (TechRepublic)
- Companies that support remote work experience 25 percent lower employee turnover (and other findings) (ZDNet)
- How to manage remote workers: 5 tips (TechRepublic)
- Remote workers at risk of burnout according to UniqueIQ (ZDNet)
- Photos: 20 home office must-haves for remote workers (TechRepublic)