6 ms·

Startups are cash-poor, prone to bankruptcy, and full of insane deadlines requiring people to pull small miracles just to make payroll. Would love to hear more

Startups are cash-poor, prone to bankruptcy, and full of insane deadlines requiring people to pull small miracles just to make payroll. Would love to hear more about what makes them ideal freelance clients. As a former contractor/freelancer, I specifically made a point of staying far, far away from these kinds of clients.

vassvdm 13y ago
If you're in it for the money, early stage startups are not the way to go as far as clients go. As I mentioned in the post I do it because I love startups and working on MVPs specifically. It also lets me get my mind off my own startup and see how others do things differently.
7Figures2Commas 13y ago
That's why joining an early-stage startup as an employee is often not attractive. But building MVPs for "startups" isn't necessarily unattractive. Obviously, you want to stay away from broke "seeking co-founder" types, but there are plenty of people out there capable and willing to invest $xx,xxx in their new businesses. As an example, I believe Kevin Rose took his savings ($10,000 if I remember correctly) and paid a freelancer he found on Elance to build the first version of Digg.
- duochrome 13y ago
  Can you tell me some story about the "seeking co-founder" types?
  - 7Figures2Commas 13y ago
    The "seeking co-founder" types I was referring to are folks looking for a technical co-founder who they can partner with. They don't want a service provider, and many of them don't want to pay you cash, or can't pay you cash. Instead, they offer to compensate you with equity or revenue share.
    - duochrome 13y ago
      I asked because I have partnered in part-time with a "seeking co-founder" folk few years ago ... I think I took it because I wasn't experienced neither. It's not great. But turns out okay. It did become a passive income. (I know it's very rare to happen.)
      - evolve2k 13y ago
        I met with a "seeking technical cofounder" who's initial position was 'my idea is so amazing that they will be very lucky to get to be involved, they wet surprised when I said they will likely struggle to find one. What helped the most when I reframed it as 'the programmer has limited capacity and your asking them to work for free for you for a year'. He saw it didn't seem like such a good deal when put that way.
      - te_chris 13y ago
        You got super lucky. Kudos.
kleinsch 13y ago
I've been doing this full-time for the last year. It's worked well for me in the SF area because it's a lot easier to get in the door for new companies/products than with established companies that already have dev teams. I also like working on brand new products and technologies and startups are great for that. :) The main lesson I've learned working with startups is that consulting is always easier working for people that are spending other people's money. The guy who spent the last year saving $10K of his personal earnings to build his genius daily deals for big data social mobile app? He's going to try to squeeze you for everything he can get. The startup that raised a $1.5MM series A? Going to treat dealings like a business negotiation and probably be less emotional to deal with. That being said, you still want to manage risk based on who you're dealing with. If I'm consulting for a company with $50MM in revenues and 200 employees, I'm not worried about them going under tomorrow, so I'll let them pay me monthly net-30. If I'm consulting for a 5 person startup that's operating on a seed round, I'll usually require weekly net-7 or net-15. I've started avoiding companies that seem sketchy or are operating off personal savings, but if I was going to work with those types of clients in the future, I'd do a prepaid retainer. Of course, this varies on a case-by-case basis so YMMV.
- evolve2k 13y ago
  Just listened to a great podcast by 'The Freancer shows' - Weekly Billing[1]. They talked about requesting weekly billing which is paid upfront, eliminating collection issues. [1](http://www.freelancersshow.com/the-freelancers-show-097-weekly-billing http://www.freelancersshow.com/the-freelancers-show-097-week...)
- skrebbel 13y ago
  what does "net-7" mean?
  - emiliobumachar 13y ago
    I don't know, but I infer that it should mean getting paid on the end of each week. If the startup suddenly goes bankrupt, you only lost a week.
jlees 13y ago
The work is interesting. I've been consulting for a few startups doing MVP development and it was a lot of fun getting those first few decisions off the ground and doing a bunch of product as well as code work. It depends on the length/terms of the deal, of course. I wouldn't do it as a full-time career but it was great to fill a few months of creative time while I was working on my own projects and deciding what the hell to do next. I ended up joining one of the startups I was consulting for :)
patio11 13y ago
As Thomas has mentioned, if you can budget an employee, you can budget a consultant. There certainly exist cash-poor startups who don't know where their next bowl of ramen is coming from, but there also exist startups with dozens or hundreds of employees.
- mattwad 13y ago
  there's a huge difference in what a startup is when it's 3-4 guys vs hundreds. The latter is not much different as working for any other company, and you can probably get paid in cash.
Arun2009 13y ago
I am currently working full-time remotely on the MVP of an interesting start-up. I get paid relatively low fees and some equity (the discussions are on). I am doing this because I like being in 100% control of the development process and deeply involved with the creation of the product itself. It's a great learning opportunity that can come in handy when you get around to working on your own product someday.
- UweSchmidt 13y ago
  Those equity discussions... why not finalize those asap? Your negotiation power dimishes as the product nears completion, as success is becoming more likely and as other people are coming in and contribute.
  - Arun2009 13y ago
    It's just that I don't intend to stay with this project after the MVP stage, and don't want further commitment. Insisting on equity will make things complicated.
    - evolve2k 13y ago
      Anyone taking on similar work, eg just plans to do the initial MVP work but lines up a standard equity stake as part of their contract? I've heard of deals where say I discount my rate by X in exchange for Y% equity. Would love some rule of thumb numbers of what X and Y are.
scarecrowbob 13y ago
I'm a full-time freelance programmer, and over the last 4 years I've done several projects for clients like these, though generally I do work for agencies/shops. For reference, typical projects include a product matching software to link buyers at large chain stores with product (spectacular failure, by the way) and yet another professional certification automation site. First and foremost, it's interesting, typically greenfield work where I don't have to come up to speed on old code. Second, I'm am earlier in my career, and it has been a really good way of getting relevant, larger-scale projects into my CV. Third, I can charge the same rate as I do with my agency clients and that makes them super happy because they aren't paying the agency but, at the same time, there are a lot of issues that I don't have when dealing directly with a typical agency client: generally, they feel more inclined/involved, get back to me quickly, have strong (usually well formed) opinions. And while I can't really get a whole lot of money out of these clients, generally I get more than I would as a subcontractor on the project, which is quite a bit. There are indeed bad projects in the space... I worked briefly on part of an optimizely clone where although I personally liked the principles and thought they had an interesting product, they were very unorganized and generally hard to work with... but that's true of any space and at least I don't have an agency pressuring me to do the project even thought I think it is bad situation.... which, in the end is the best reason: I can walk away from these things if they don't go well, having been paid well, but less than they would have spent on an employee or hired a firm. Thinking about it maybe that bit of risk management indicates that it's not so much that these are "ideal" freelance clients, but rather than being a freelance is a better kind of relationship for both sides in terms of managing risk.

vassvdm 13y ago

If you're in it for the money, early stage startups are not the way to go as far as clients go. As I mentioned in the post I do it because I love startups and working on MVPs specifically. It also lets me get my mind off my own startup and see how others do things differently.

7Figures2Commas 13y ago

That's why joining an early-stage startup as an employee is often not attractive. But building MVPs for "startups" isn't necessarily unattractive. Obviously, you want to stay away from broke "seeking co-founder" types, but there are plenty of people out there capable and willing to invest $xx,xxx in their new businesses. As an example, I believe Kevin Rose took his savings ($10,000 if I remember correctly) and paid a freelancer he found on Elance to build the first version of Digg.

duochrome 13y ago
Can you tell me some story about the "seeking co-founder" types?
- 7Figures2Commas 13y ago
  The "seeking co-founder" types I was referring to are folks looking for a technical co-founder who they can partner with. They don't want a service provider, and many of them don't want to pay you cash, or can't pay you cash. Instead, they offer to compensate you with equity or revenue share.
  - duochrome 13y ago
    I asked because I have partnered in part-time with a "seeking co-founder" folk few years ago ... I think I took it because I wasn't experienced neither. It's not great. But turns out okay. It did become a passive income. (I know it's very rare to happen.)
    - evolve2k 13y ago
      I met with a "seeking technical cofounder" who's initial position was 'my idea is so amazing that they will be very lucky to get to be involved, they wet surprised when I said they will likely struggle to find one. What helped the most when I reframed it as 'the programmer has limited capacity and your asking them to work for free for you for a year'. He saw it didn't seem like such a good deal when put that way.
    - te_chris 13y ago
      You got super lucky. Kudos.

kleinsch 13y ago

I've been doing this full-time for the last year. It's worked well for me in the SF area because it's a lot easier to get in the door for new companies/products than with established companies that already have dev teams. I also like working on brand new products and technologies and startups are great for that. :) The main lesson I've learned working with startups is that consulting is always easier working for people that are spending other people's money. The guy who spent the last year saving $10K of his personal earnings to build his genius daily deals for big data social mobile app? He's going to try to squeeze you for everything he can get. The startup that raised a $1.5MM series A? Going to treat dealings like a business negotiation and probably be less emotional to deal with. That being said, you still want to manage risk based on who you're dealing with. If I'm consulting for a company with $50MM in revenues and 200 employees, I'm not worried about them going under tomorrow, so I'll let them pay me monthly net-30. If I'm consulting for a 5 person startup that's operating on a seed round, I'll usually require weekly net-7 or net-15. I've started avoiding companies that seem sketchy or are operating off personal savings, but if I was going to work with those types of clients in the future, I'd do a prepaid retainer. Of course, this varies on a case-by-case basis so YMMV.

evolve2k 13y ago
Just listened to a great podcast by 'The Freancer shows' - Weekly Billing[1]. They talked about requesting weekly billing which is paid upfront, eliminating collection issues. [1](http://www.freelancersshow.com/the-freelancers-show-097-weekly-billing http://www.freelancersshow.com/the-freelancers-show-097-week...)
skrebbel 13y ago
what does "net-7" mean?
- emiliobumachar 13y ago
  I don't know, but I infer that it should mean getting paid on the end of each week. If the startup suddenly goes bankrupt, you only lost a week.

jlees 13y ago

The work is interesting. I've been consulting for a few startups doing MVP development and it was a lot of fun getting those first few decisions off the ground and doing a bunch of product as well as code work. It depends on the length/terms of the deal, of course. I wouldn't do it as a full-time career but it was great to fill a few months of creative time while I was working on my own projects and deciding what the hell to do next. I ended up joining one of the startups I was consulting for :)

patio11 13y ago

As Thomas has mentioned, if you can budget an employee, you can budget a consultant. There certainly exist cash-poor startups who don't know where their next bowl of ramen is coming from, but there also exist startups with dozens or hundreds of employees.

mattwad 13y ago
there's a huge difference in what a startup is when it's 3-4 guys vs hundreds. The latter is not much different as working for any other company, and you can probably get paid in cash.

Arun2009 13y ago

I am currently working full-time remotely on the MVP of an interesting start-up. I get paid relatively low fees and some equity (the discussions are on). I am doing this because I like being in 100% control of the development process and deeply involved with the creation of the product itself. It's a great learning opportunity that can come in handy when you get around to working on your own product someday.

UweSchmidt 13y ago
Those equity discussions... why not finalize those asap? Your negotiation power dimishes as the product nears completion, as success is becoming more likely and as other people are coming in and contribute.
- Arun2009 13y ago
  It's just that I don't intend to stay with this project after the MVP stage, and don't want further commitment. Insisting on equity will make things complicated.
  - evolve2k 13y ago
    Anyone taking on similar work, eg just plans to do the initial MVP work but lines up a standard equity stake as part of their contract? I've heard of deals where say I discount my rate by X in exchange for Y% equity. Would love some rule of thumb numbers of what X and Y are.

scarecrowbob 13y ago

I'm a full-time freelance programmer, and over the last 4 years I've done several projects for clients like these, though generally I do work for agencies/shops. For reference, typical projects include a product matching software to link buyers at large chain stores with product (spectacular failure, by the way) and yet another professional certification automation site. First and foremost, it's interesting, typically greenfield work where I don't have to come up to speed on old code. Second, I'm am earlier in my career, and it has been a really good way of getting relevant, larger-scale projects into my CV. Third, I can charge the same rate as I do with my agency clients and that makes them super happy because they aren't paying the agency but, at the same time, there are a lot of issues that I don't have when dealing directly with a typical agency client: generally, they feel more inclined/involved, get back to me quickly, have strong (usually well formed) opinions. And while I can't really get a whole lot of money out of these clients, generally I get more than I would as a subcontractor on the project, which is quite a bit. There are indeed bad projects in the space... I worked briefly on part of an optimizely clone where although I personally liked the principles and thought they had an interesting product, they were very unorganized and generally hard to work with... but that's true of any space and at least I don't have an agency pressuring me to do the project even thought I think it is bad situation.... which, in the end is the best reason: I can walk away from these things if they don't go well, having been paid well, but less than they would have spent on an employee or hired a firm. Thinking about it maybe that bit of risk management indicates that it's not so much that these are "ideal" freelance clients, but rather than being a freelance is a better kind of relationship for both sides in terms of managing risk.