The Stuff That No One Tells You: The Unpleasant Parts of Professional Freelancing
Despite the hyperbolic title, I consider myself as possibly one of the luckiest people in the world.
And, there's a glamourization of the world of entrepreneurship / freelancing in my opinion.
So first let's define why I said professional freelancing.
HandBuiltBrands is a business. It's an LLC, has financial statements, there's a growing team, we have office space and we've had tremendous growth. As an accountant would say, it is a "going concern."
Those aren't what you'd expect to see when you hear of a professional freelancer. However, I came to the realization over a year ago that HandBuiltBrands is not yet a business. It's still my professional freelancing career.
I'm trying to make it a business, which I would define as: something that can run, well, without me running it.
It's not there.
So, now that I've made that distinction, let's talk about "The Sh!t That No One Tells You."----
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A note to self in my Evernote - 5/18/15:
I’m writing this not because things aren’t going well. They are. I love this life and couldn’t imagine any other now. But golly, there’s a lot of mistakes I’ve made and things I would have done very differently. In fact, I’m sure I’ll look back in a few more years and say what I’m doing today is crazy. But besides asking for counsel on every decision I make, and there’s dozens everyday, I wish I’d had a resource to tell me what it is that I’m doing and should have done differently.
Conversations for me about starting a business are typically along the same lines. The benefits. But dammit, this is hard. And there’s something new that pops up a couple of times a week/month/year and you go “sh!t” why didn’t anyone mention this! It’s our human nature I guess. Or maybe people do say it and we don’t listen. In that case, no one will read this. But for those that do, I hope you find it helpful.
Another reason I’m writing this is that I feel that I’m in a unique position to speak with a lot of people who all start, run or grow businesses. As a branding consultant, I have access to many people who have or are starting businesses. I’m going to have a goal to sit down with them and ask them, “what’s the one thing in your experience that is the sh!t no one told you about starting a business?”
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(Back to present)
WHAT YOU SHOULD KNOW WHEN YOU START A BUSINESS
When I was dreaming of this business, it was all roses. Going back and reading the initial business plan is kind of hysterical. It wasn't grounded in reality, which is how hard you need to work day in and day out, how much you need to learn and how much effort goes into both of those.
Though the nice thing about the initial business plan was how optimistic and black and white it was: This is what we're going to do, we're going to make this much money, these are the clients we'd have (literally named Client 1, Client 2, Client 3, and Client 4).
Someone asked me at a party last year what I'd do differently, and the funny thing that I'd try to do for the business's sake is try to stick more to the initial business plan instead of chasing revenue. But that leads me to the first thing that no one told me, or to be fair, I never heard.
PICK A SERVICE SPECIALIZATION OR A NICHE (INDUSTRY VERTICAL) OR BOTH
Early growth would have been slower had we learned that "the riches are in the niches," but we would have started to cement ourselves as experts in the space, my team would know a lot more about the niche, we could have hired to knowledge of the niche, and my gut says that it would be closer to being a business. As of now, I'm probably the only one on the team who can speak to a strategic approach to our services and client industries.
As an example, this is what we can currently do (services):
3D animation
3D modeling
Graphic design
Brand work
Collateral printing
Promotional products
Search engine optimization (SEO)
Local SEO
PPC
Facebook ads
HubSpot COS design and development
Wordpress custom development
Online display advertising
Copywriting
Content writing (they are different)
Technical writing (energy and industrial)
Email automation
and there's more
We do these services for these types of industries:
Automotive
Power
Power brokers
Upstream oil & gas
Oilfield equipment
Oil & gas marketing
Diesel & natural gas generators
Water treatment
Commercial real estate (office tenant rep)
Commercial real estate (multi family)
Valve actuators
Medical devices
Regenerative medicine
Orthopedics
Senior living
Construction
Residential general contractors
Residential property management
Residential real estate brokers
Consulting
and more. I'm not kidding.
Let's be honest. How can you expect someone to know something about all that stuff? You just can't.
Now to me, as a professional freelancer, it's fun.
I love rapidly learning about new marketing stuff and new industries.
I love that people who are looking to explain what they do, simply, come to us to help explain it to others for things like sales meetings and investor presentations.
I love this work; it's my calling.
But if the goal is the build a sustainable "business," the generalist approach is not sustainable, in my humble opinion.
PARTNERS
I don't have a partner in HandBuiltBrands. I think that's best. But I've heard both things. I've heard some people say that you have to be a maniac to start an agency on your own. I've heard others say that they couldn't imagine having a partner. I can see both sides.
There's definitely days when you think it's best to roll on your own. You look around, evaluate the situation and make a call. You're only answerable to yourself. I like that action
.There's other days when it might be a good thing to have a partner, one who is a counter-balance to you and your strengths. Someone who can pick up the slack where you fall short. Someone who might make you move more slowly when considering a big software purchase or presenting a proposal.
My origin story:
I intended to start the company with a partner, but we had different times when we intended to start. I jumped from my job. He didn't.
In hindsight, it's what God intended for me. That first stretch would have been really, really challenging (revenue and net income-wise)
.I think I would have made some better decisions having someone who knew the business and was invested along with me making the calls.
But I learned SO much. I think I learned more in the early years in the company than probably my first 10 years in the business and business school rolled up into one.
MOST PEOPLE PAY THEIR BILLS (AND ON TIME)
Just most though. Stay in the business long enough and you'll have a "bad debt" conversation. "No I'm not going to pay that bill." "Oh, ok. Huh?"
And clients don't always agree to your payment terms. I got a contract back once that was signed (in a point in time where I needed it badly), and it had my payment terms scratched out, changed and initialed. I took it because I needed it.
Casual observation: people who have been on salary their whole life can be the slowest ones to pay invoices. Side note: Fred Wilson of Union Square Ventures once wrote that a salary might be the most addictive mechanism of all time. This stuck and resonated with me. That's all I have to say about that.
LAWYERING UP
Have a lawyer from the beginning. This was one that a professor did tell me. I remembered. And I didn't listen. I should have saved up more money over more time and had proper contracts drawn up at the beginning for clients, ICs and employees. We should have consulted on how to form the company. When people ask, "what should I do if I'm considering starting a business?" I'll typically give them a few pieces of advice:
Have and pay a lawyer prior to starting
Have and pay an CPA prior to starting
Figure out: what do you sell, who do you sell to, how do you keep customers?
AN ACCOUNTANT
Have an accountant. Be on the same page as your accountant.
Setup your books correctly, the first time. (OMG, do not use a spreadsheet.)
Know what is sales taxable. It's your responsibility to know this, and boy howdy, if you're making websites in Texas, get professional advice. Texas sales tax is, literally, insane when it comes to this industry.
Know when you should hire an employee versus using an independent contractor. Use the 20 question test of an employee vs. IC. Get advice on it. But it's your responsibility to know this stuff, ultimately.
Don't delegate business-critical knowledge.
Know about paying and filing payroll tax, unemployment tax and property tax.
Know how your income taxes will show up and consult with your accountant throughout the year on it. Pay your 1040 ES quarterly. Don't get behind. The first time you say, "what's self employment tax?" is a bad day. Because if you've been pulling a salary your whole life, you don't realize what your employer has to pay in matching payroll tax.
Bless those successful business owners. You'll be in amazement of how they do it.
HEALTHCARE
I'm not sure I could have picked a more confusing time in the history of the US to setup health insurance. ACA rolled out early in the life of HBB. And hunting for an insurance plan was a BEAR. And once you find one, you really don't know what's covered or not.
There was one period, right around the time of the oil crash, awesomely, where we had $500, $2k, $3k, etc. bills rolling in from visits that weren't actually covered from a doctor's office that said we were on their plan.
Our family is now using Medi-Share. It's not insurance; it's a Christian bill-sharing program. It's not as fruity as it sounds I think, so email me if you're interested.
HI, I'M A MAC, AND I'M A PC
You have a Mac.
That's awesome.
Every single one of your clients is on a PC.
Have PC software that is Microsoft Office, which is going to look different than your Mac office software to them.
NOT EVERYONE DRINKS "I GIVE A **** JUICE, LIKE YOU DO."
In fact, many will be drinking "I DGAF juice."
You will care more about your work, your business and your clients than almost anyone else.
Just be prepared for that.
IT'S A LOT HARDER THAN IT LOOKS
I wouldn't trade it for anything in the world, almost.
This life that Brooke and I have chosen has given us a lot -- freedom of lifestyle, a way to raise four girls how we want to, and an expansion of my mind that I'm certain will help me to better serve the Kingdom of God.
It's hard tho, FYI.
(more updates to come)