Customer Acquisation, Start-ups, Covid-19: An Interview with a Specialist about the Daily Work of Freelancers
Nick Oestreich works as Business Development and Community Manager at Uplink, a start-up from Berlin that brings together freelancers and clients from the IT sector. In this interview, he tells us what mistakes freelancers often make, especially at the beginning, why working with freelancers is also worthwhile for start-ups, and what experiences he has had during the Covid-19 pandemic, both on the corporate and the freelance side.
Customer Acquisation: That’s what it’s all about
In your opinion, is there a successful approach to presenting yourself as a freelancer to potential clients in order to get contracted?
There are essentially two points that freelancers should focus on:
I always recommend our freelancers invest some time in creating a convincing CV or a project list. Many freelancers who have only recently become self-employed have, in some cases, never had to actively apply for open positions. They were recruited by companies directly or received a reference. Of course, references and a broad network still count for freelancers, but the CV – or a convincing portfolio in the design area – is the thing that the client or recruiter see first. In addition to the project duration and the area of responsibility, the technologies used should also be listed there so readers can get an idea of the extent as well as the scope of the experience.
If you apply as a freelancer in a project whose technologies you have not yet worked with, it is a good idea to mention related technologies or private projects in your CV. Experienced freelancers can usually quickly familiarise themselves with new technologies. Your own website with a service portfolio, references and successfully implemented projects is also a good way to present yourself.
It is important not to give rise to false expectations during your first discussions with the client. When developing MVPs in particular, companies rely on the expertise of freelancers, so they need a realistic assessment of the feasibility of their project and the resources that are likely to be required. An experienced freelancer can best estimate how much time the development of individual features will take and which functions can be dispensed within the first step. A good client will appreciate this pragmatic assessment.
What Mistakes you Can Avoid as a Freelancer in the Beginning
In your opinion, what are the most common mistakes freelancers make at the beginning of their careers, and what tips do you have to avoid them?
There are two mistakes that I often see with freelancers who are still at the beginning of their freelance careers.
Inadequate Hourly Rate
One of the most common mistakes that often happen in the beginning is an inadequate hourly rate. Freelancers, who are still at the beginning of their careers, often tend to sell themselves below their value - consciously or unconsciously. It’s a good idea to exchange ideas with other freelancers in your field in order to be able to achieve a reasonable market price. Most newcomers already have the relevant experience in the context of their permanent employment.
If they lack some of the relevant experience, an option would be to set a lower hourly rate for the first two weeks until they are properly set up. But after this intoductory phase clients should pay an hourly rate that is customary for the market. Investing more time in a project than you can bill for will only lead to frustration for both sides and of course reduces your hourly rate considerably. Communities or “circles” for your field and for freelancing in general are definitely a good initial point of contact.
Underestimation of Administrative Tasks:
At the beginning, freelancers often underestimate the entire range of tasks that go along with moving into self-employment. This includes, for example:
- Positioning yourself, for example through a website
- Deciding on a suitable legal form
- Accounting tasks such as invoicing
- Acquisition of new clients
All of this has to happen in addition to your billable work on various projects. When it comes to administrative tasks in particular, however, there are a lot of great tools to make everyday freelance work easier, some of which are even available free of charge. It is also a good idea to define clear periods of time for completing such tasks, for example by making an entry in your calendar.
In your opinion, what are the greatest challenges freelancers face when working with companies?
Of course, that always depends a lot on the context of the project and the respective freelancer. In general, however, I keep seeing three major challenges:
Communication & False Expectations
There is nothing more damaging to the success of a project than the lack of communication and false expectations. At the beginning of a project, both parties should agree on fixed dates to evaluate the progress of important milestones. If unexpectedly new challenges arise while working on the project (which is the case with almost every project at a certain stage), that require an adjustment of the schedule, the freelancer should communicate this immediately so a solution can be agreed upon. I have often seen cases where the client is waiting impatiently for a response from the freelancer, while the freelancer is actually making great progress. The best thing to do as a freelancer is to include the client in weekly or daily meetings to avoid this.
Particularly, freelancers often do not work on site and they are not as strongly included with the team as permanent employees, their work cannot be tracked in the same way as with company employees. However, a good foundation of trust is essential so freelancers are able to work during the time and in the place where they are most productive. Very few freelancers - especially in the development area - like to work in an open-plan office from 9 a.m. to 5 p.m. A work performance record, which states the freelancers daily working hours roughly, can be helpful.
Grown-up versus Start-up: What Are the Differences?
Is there a difference between working with a long-standing company or a start-up?
Of course, that always depends on the project. In general, the structures of start-ups are more agile and less hierarchical, which is also due to the smaller teams. As a developer in the initial phase of developing an MVP, you often work directly with the CEO in a manageable team and are allowed to participate in many areas such as design, consulting, requirements analysis and actual development. This is really exciting for many freelancers because they can learn a lot in a considerably short time frame.
Even in a later phase with a “grown up”, i.e. a start-up that has already raised several million euros in risk capital, the open communication channels and flat hierarchies that freelancers appreciate can still be found. In our experience, the teams are often more international and there is more opportunity for handling projects completely remote.
Speaking of start-ups: Do you have tips for start-ups regarding the projects (or starting at what point) they should consider working with freelancers?
Depending on the business model, freelancers can provide support in almost every phase of the development cycle. At Uplink, we find that most start-ups approach us for the first time when it comes to developing an MVP, i.e. a prototype. Sometimes, however, even beforehand, when they have a business idea for a technical product or service and need a cost estimate from a freelancer. Freelancers’ experience is extremely helpful when it comes to developing MVPs, where the aim is to only integrate the essential functions so that the product can be introduced into the market quickly.
Afterwards, freelancers are usuallly employed on an interim basis while the start-up grows into a full fledged business, to fill in temporary gaps that arise during growth. In the IT area, freelance developers are also employed on a long-term basis in order to introduce a new skill set to the team and train internal employees. While a start-up is scaling up, freelancers can also provide excellent support in setting up new infrastructures.
Covid-19 Pandemic: Opportunities and Lessons Learned
The Covid-19 pandemic and the related restrictions have hit many freelancers as well as companies hard. What has your experience been with the Covid-19 pandemic so far - both from the perspective of a start-up and how the contracting situation was treating freelancers?
We significantly felt the effects of the Covid-19 pandemic at the beginning of March 2020. Companies were in a kind of paralysis because everything was initially uncertain. Many clients expected a sharp drop in turnover and initially saved costs wherever they could. Before employees were sent on short-time work, freelance projects were put on hold.
This also had an impact on the number of projects advertised with us. We only advertised a handful of projects between March and July 2020, compared to more than 30 in the years before. Many large companies that were previously advocates of location-based work had to create appropriate infrastructures for the first time. Most of our clients, however, were also start-ups who had already worked remotely before the crisis. Companies eventually noticed there was no lack in demand and, since October 2020, have returned to a “new normal”.
Do you think it is a good idea right now to start your own business? And what should prospective freelancers pay special attention to right now?
The market has largely recovered now, at least in the area of IT services, which is the area that Uplink covers, and there are lots of freelance projects. But that is far from the case in the event sector, for example, if you want to become self-employed as a freelance photographer. In general, you should be aware that starting freelance work can be very challenging, especially in the beginning. Acquiring your first projects in particular often takes several weeks. So it is advisable to build up a financial cushion in advance. Another option is to get a first impression of self-employment as a part-time job. It takes a bit of courage - but I hardly know any freelancer who has regretted taking this step.
Thank you Nick Oestreich for this exciting insight into the daily work of freelancers and your tips on customer acquisition and starting your career as a freelancer. We wish him continued success with the Uplink network, which brings clients and freelancers together.
Nick Oestreich is 28 years old, and after graduating he worked for two of the largest personnel service companies as a recruiter and in sales as an account manager. However, it quickly became clear to him that he didn’t want to stay in this industry forever and that he wanted an innovative and creative work environment where he could contribute his own ideas and realise his passion for travel through remote work. For more than a year and a half at Uplink as Business Development and Community Manager, he has been responsible for project tenders and candidate selection, event organisation, as well as selection of and collaboration with new partners.
Uplink is a start-up from Berlin that understands itself as an exclusive network for IT freelancers. Companies have the opportunity to post projects on Uplink free of charge. Freelancers can in turn apply to the network and only pay Uplink a fee of ten percent of their commission for a maximum of six months after receiving a contract. Interested freelancers and companies can find more information about Uplink at: www.uplink.tech
Daniela has been working in the areas of (online) editing, social media and online marketing since 2008. At exali, she is particularly concerned with the following topics: Risks through digital platforms and social media, cyber dangers for freelancers and IT risk coverage.
In addition to her work as an online editor at exali, she works as a freelance editor and therefore knows the challenges of self-employment from her own experience.