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After spending 200+ hours developing the system, not a dime has been seen or given Freelancers should always try to get at least a deposit upfront. When I was

• thebigredjay 15y ago
  Where is a good place to learn the ins and outs of contracts? Is there a comprehensive website or book that you can recommend? I am early in my career and have been on both sides of writing contracts. While I am figuring a lot of things out as I go it would be nice to sit down and wrap my head around this for good. Also, to the OP, is a few weeks really enough time? If those were 200 billable hours it seems like it's worth a tad more hunting.
  • shaggyfrog 15y ago
    > Where is a good place to learn the ins and outs of contracts? Law school. ;) Okay, okay. Seriously, besides getting a lawyer and have them draw you up a standard contract, there isn't much you can do to "wrap your head around [contract negotiation] for good" as there's just too much to learn. Some of it comes from experience (you'll start getting a radar for certain kinds of clauses), and there's no quick fix for getting experience besides the passage of time. Specifically, make sure there is a provision in there for getting some of the payment up-front (as grandparent suggests), and specify a late fee % for any overdue bills.
  • RexM 15y ago
    http://vimeo.com/22053820 http://vimeo.com/22053820 This is a good video about contracts. It's targeted for designers, but I think most of it still applies to developers. I think the best point in the video, have a good lawyer.
    • PedroCandeias 15y ago
      Nice! And it applies to all kinds of service providers, really, from freelancers to BigCo.
    • dkersten 15y ago
      When I saw the title of this submission, I immediately thought of this video. Everybody should watch this video, at least twice. And never ever ever start work without a contract in place! Also, the magic words to avoid the described scenario are "intellectual property will transfer on receipt of payment". The parents video covers this in more detail.
  • drewcrawford 15y ago
    Shameless plug: http://news.ycombinator.com/item?id=2594422&mobify=0 http://news.ycombinator.com/item?id=2594422&mobify=0
  • byoung2 15y ago
    Where is a good place to learn the ins and outs of contracts? Is there a comprehensive website or book that you can recommend? The freelance kit from www.sitepoint.com is where I learned a lot about techniques for freelancing. That's where I picked up the technique for deposits and milestones. In fact, one of the best pieces of advice I got from there was never to be the lowest bidder. There was a project we were bidding on, and the client ended up going with us even though we were the highest bid ($8000). He showed us the other bids, and they came in at ($1600, $2800, and $4500). He liked our proposal for a few reasons: One, the other 3 bids were just Word documents or PDFs attached to email. Ours was printed in color, bound, and sent FedEx overnight. Another, we had detailed writeups of 3 previous projects with testimonials and phone numbers of the clients (used with permission). Lastly, we had suggestions for additional features to add, with a cost/benefits analysis on each, along with suggestions of features that could be cut to reduce the timeline or cost. All of these were suggestions from sitepoint's ebook.
  • bitsweet 15y ago
    You can buy the MSA + SOW that hashrocket uses with its clients http://blog.obiefernandez.com/content/2008/09/master-services-agreement-part-1.html http://blog.obiefernandez.com/content/2008/09/master-service...
    • tptacek 15y ago
      Be aware that if you client has more than ~50 employees, you are very unlikely to end up working under your MSA. By all means try, but be ready to have your lawyer review their MSA, because their MSA is going to be the basis for your project. You might almost be better off trying to sneak in under the MSA with the "simplest contract that could possibly work" than you'd be by formalizing the relationship with an MSA. It is very possible to get a one-off contract executed, especially for one-off services. On the other hand, if you ignite the "MSA" neuroreceptors, you may find yourself far worse off than if you had simply gotten a Nolo-style work-for-hire contract signed; for instance, it's the MSA that's going to have IP clauses, noncompetes, insurance requirements, and things like that. Be careful and don't wave things like "MSA"s around just because they seem like best practices. They are, for a company like ours or like Hashrockets; we're set up to negotiate and review MSA change bars. You on the other hand may not want to round trip with a lawyer several times just to do an $8000 PHP contract.
  • vaksel 15y ago
    contracts usually aren't worth the paper they are written on. Because even if you win in court, it doesn't mean the guy will pay you...you'll still need to chase after the money.
    • stel 15y ago
      Contracts are useful for spelling out the rights and responsibilities of each party so there are no misunderstandings later. But I agree with you, if the person you're contracting with doesn't want to pay you, you may well waste more than the contract is worth trying to get your money.
      • tptacek 15y ago
        If your client ends up not using your work product, either because their business falters or because they reject your work, you stand a good chance of not getting paid --- contract or no contract. That's life in the big leagues. If your client ends up using your work, your contract is going to end up plenty enforceable. If your client ends up using your work and you don't have a contract, don't expect to get paid this year, and expect a painful obstacle course of unreasonable support demands. They'll pay you eventually, but since you've reduced the worst case outcome to "amount we agreed on" from "treble damages and site downtime", they have every incentive to drag things out.
    • FuzzyDunlop 15y ago
      They do at least offer you a leg to stand on when it comes to clients asking for constant new features without wanting to pay for them. You can refer to it to back up your refusal to do extra work and by the same token it sets a bare minimum standard for you to meet before the job is considered done. I did some freelance without a contract once and because I didn't have an agreement in writing I didn't have much recourse to tell them there'd be a charge for additional services. A contract will never be a quick and easy solution to stop people doing a runner but you can at least limit the damage caused with one.
    • tptacek 15y ago
      Completing a project without a contract is begging to get shafted. It sets up an incentive for the client to demand extensive modifications and long-term support --- things you'd otherwise be charging for --- or even invites them to take your work and hand it to another contractor as a starting point. Message board cynicism is a poor excuse for bad business practices.
  • georgieporgie 15y ago
    Where is a good place to learn the ins and outs of contracts? Is there a comprehensive website or book that you can recommend? Nolo press has a variety of books that are probably relevant. Your local library likely has an assortment of them.
  • brudgers 15y ago
    >"Where is a good place to learn the ins and outs of contracts?" It's more an issue of customer relations than contracts. Contract specifics should be a reflection of that relationship (or lack thereof). The way most people really learn customer relations or contracts is The School of Hard Knocks. The introductory sequence consists of SHK101 - Get it in Writing, SHK190 - Retainers, SHK225 - Applying Retainers to Final Invoice, and SHK230 - Termination Fees.
  • kposehn 15y ago
    I've run my own marketing firm for the last few years and have dealt with similar issues as the OP. How you structure up front payment is always up to you. We've always had a setup fee, typically a few thousand dollars, which is due before any work starts. However, there has been one single thing which has kept our revenue flowing month after month for years: Freshbooks.com I seriously love that site. We use it for: 1. Making estimates 2. Tracking hours worked against estimates 3. Invoicing based on hours and services rendered 4. Making sure the client indeed noticed the invoice - it says "viewed" when you send by email and they actually log in and view, so you can call bullshit when they say "I didn't get it yet!" :D 5. Automatically adding late fees to invoices. We charge a relatively nasty fee each month for a late invoice and it automatically adds it to each one. 6. Tracking payment; clients get notified via email when payment has been received, something many have commented on as a great feature. Quickbooks and other tools are all well and good, but imho I think Freshbooks pretty much handles 90% of what you need to be successful independently :)
    • ra 15y ago
      Nice. I've started using freshbooks recently but haven't looked at the estimate side yet. Side question, what (in percentage terms) do you call a 'nasty fee'?
      • kposehn 15y ago
        We charge anywhere from 5-10% each month, stipulated in our contract. This takes care of 90% of late payments as no one ever wants to pay that much in a late fee...and they are unwilling to say it is too high because the immediate reply is "why would you worry it is too high? You aren't planning on being late when paying, right?" :D
        • ra 15y ago
          Very nice. Thanks.
  • joaquin_win 15y ago
    http://mylawyergabe.com http://mylawyergabe.com might help you answer some questions or at least learn a bit.
  • bfirsh 15y ago
    http://www.gyford.com/phil/writing/2006/10/26/a_beginners_guid.php http://www.gyford.com/phil/writing/2006/10/26/a_beginners_gu...
  • marknutter 15y ago
    Honestly, it doesn't need to be complicated. If you just require 25-50% down on your contracts that will weed out the scammers from the legit customers, and will make sure you get partially compensated should they ever leave you in the lurch. Make sure you document all communication, try to keep it over email so it's easy to do that, and you'll be fine should you ever need to take something to small claims court (which will probably never happen).
• mattgreenrocks 15y ago
  Do you run into any pushback from potential clients when you tell them this?
  • getsat 15y ago
    I imagine he does, but those are probably also the type of clients you don't want to be accepting anyways.
    • byoung2 15y ago
      Exactly. This is the same reason car dealerships or mortgage lenders ask for a down payment. You want both parties to have "skin in the game" so neither wants to walk away from the deal. If you can't come up with $500 upfront as a show of good faith, I don't want you as a client. That is non-negotiable. In my experience, this is more of a problem the lower the project price is. On $5000+ projects, you're dealing with a type of client who is used to paying deposits upfront (just like when you buy a car, a house, or hire a contractor to remodel your bathroom). On the $500-$1500 projects you get more amateurs.
    • tptacek 15y ago
      Or any company large enough to have a purchasing department or in-house counsel. I'm just saying, be careful with black-and-white stuff like this. Your rule of thumb will serve you in good stead with small local clients, or fledgeling startups. It's a lot sketchier with BigCos. BigCos don't dick around with payables; it costs them more not to pay you than it does just to respond to the damn invoice. They may take forever+30 to pay you, but they will pay you, and they know it, and so they're a lot less likely to go through the contortions they need to go through to pay you anything up front.
      • smackfu 15y ago
        Our BigCo to BigCo contracts are 50% payable on signing, 50% payable on delivery. But it's a longstanding relationship, so it's not like either side is going to walk.
• tptacek 15y ago
  We're a small company relative to the kinds of companies who usually contract out dev or tech work, and we will pay something up front. Probably closer to 25% than 50%, but we wouldn't get mad if you asked 50%. I'm saying this as a data point for people just getting started who might be nervous about asking for payment up front. If we'll do it, I'm sure many other people will too. It's a reasonable request. On the other hand, just so you know: we never ask for payment up front for our services, ever. That's because we'd almost never get it. Most companies with in-house finance and/or counsel aren't going to pay you anything in advance. If I were freelancing, I'd ask for up-front payment, but I'd let the issue drop for any company I knew was large/established enough to pay me; if I was in a relationship with such a company and doubted the project really had legs, I'd just walk from the project.
  • idlewords 15y ago
    An additional wrinkle is that oftentimes it can take a while to set up the mechanics of payment with a first-time client. So even if there is goodwill on both sides and a willingness to pay an initial deposit, you might not see the money until you've done quite a lot of work. Since a lot of contract work is time-sensitive, waiting for payment to clear before starting work or handing over an initial milestone might not be an option. There's a tension between the desire to make a good impression on a first-time client and the desire to make sure they're not taking you for a ride. Fortunately there are often warning signs when a client is going to be particularly difficult, and there are far more decent clients than unsavory ones.
    • tptacek 15y ago
      This is a great thing to keep in mind before any of you think of writing an outraged blog post when a client doesn't honor Net+30 on your first invoice cycle. Clients usually don't.
      • lsc 15y ago
        oh man, this. So I've been doing contracting forever; usually direct to smaller companies or through a middleman who was also pretty small. And most of the time, smaller companies are pretty good about paying on time, and pretty responsive if you say "Hey, this is really important to me, I've gotta pay the power bill." (my power bill, well, let's just say it could buy my car every month.) At my first contracting gig using a body shop way larger than I was, well, they'd kinda sort of start thinking about paying me 30 days after they got my net 30 invoice. This /really/ bothered me. In fact I made a lot of unprofessional noise to the client, and ended up staying home, once, until they paid me. The thing was, I was really worried that they weren't going to pay me at all. It did not occur to me that this was just standard operating practice, and that they were planning on paying me; they just wanted to stretch it out a bit.
• gcb 15y ago
  i bet this one was on the lines "be my tech cofounder" kind of things. no one would be fooled by payment for 200 side-job hours. i think.