What's in a name? I hesitated when I wrote down the title for this article; in my mind I've always thought of freelancer, solopreneur and small business owner as essentially the same thing. Freelancers and solopreneurs are obviously one-person shows; but they are also small business owners (who may also have grown to have a team on board). Whether you identify yourself as a freelancer, solopreneur or small business owner, you're in the same boat: you're either alone or with a small team, you don't necessarily want to build an empire but you do want to make a difference - and a healthy income without working yourself to death.
I've been fortunate to see most of the spectrum; from working in large enterprises to running a small-medium company of a 100+ people to being a freelancer or solopreneur the last 8 years. I've spent a lot of time around startups - who are often one or two people - and a substantial part of my business comes from working with those companies to help them clarify their value propositions and create a roadmap for moving forward.
I've worked with small businesses (or solopreneurs or freelancers) long enough now that I've seen a common pattern emerge when it comes to success. This pattern includes 3 common elements that I now regard as essential to the success of any business. They are:
- productisation; and
(Oh yes, if you're wondering about the spelling of things like specialise instead of specialize, it's just because I live in Canada and we use the UK version of these words. They still mean the same thing.)
I did a workshop for a small startup last week. The founders have quite the plan in mind; they have a fledgling marketing business they want to build out and create enough cashflow to fund a passion project - a health app. (And it is a really interesting approach to health apps; if they do take off I will mention them in a future article.)
Their marketing business has some cashflow but not nearly enough to keep them going - and to fund the development of an app. So the first order of business is to build out the marketing business.
Marketing is one of those things that everyone seems to know is important, few business owners know how to do it well, and lots of businesses make wild promises of thousands of leads or customers. In other words, there are a lot of marketing-type businesses out there.
So how do you stand out in a crowded marketplace?
One answer is to specialise. Here's how it works:
If you hang out your shingle and tell the world "we do marketing" you're probably going to fail. There are hundreds of other marketing types out there and you can't shout louder than all of them.
But, if you put yourself out into the market as "we do marketing for restaurants" or "we do marketing for real estate agents" you're standing out. You're not trying to do marketing for everyone; you're doing it for a well-defined niche in the market. You're specialising in that niche.
There are many reasons this is powerful; here are the top two:
- It's easy for you to identify your customers. You're not looking for any business (or all businesses); you're looking for restaurants, or real estate agents. A Google search or the local chamber of commerce will quickly find you a ready-made list of potential customers.
- It's easier for your customers to find you. If you run a restaurant and you need to beef up your marketing, would you be more likely to hire someone who claims to be the best marketing company in town, or someone who specialises in marketing for restaurants?
When you specialise, you're telling your clients that you understand their problems, you speak their language, and they don't have to educate you in what's important in their business.
You're already ahead of the competition because you know the industry, and you know what won't work - something a generalist still has to learn. You're a lot more attractive to your clients because you specialise in their niche.
For more about specialisation, you can read:
- Specialising is difficult (but you should anyway);
- The biggest problem you will face in building a successful small business; and
- The riches are in the niches
The most common business model for freelancers is to charge out their time for money. It is also just about the worst business model you can choose - for you as a freelancer and for your clients.
There are many reasons this is a bad idea; here are the top two:
- When you ask clients to pay you by the hour (or day, or week), you are asking your clients to compare you to everyone else out there who claim to have similar skills. And then you're competing on price, and there's always someone cheaper than you.
- Your expertise is no longer the most important thing - the time you spend on the project is. You've lost the advantage of being able to charge more for your expertise, and your clients have lost sight of your expertise as the main reason they hired you.
A better business model is to package your services just like products. Fixed price, fixed scope, fixed deliverables - however long it takes you to do it. Effectively you're selling your services as a range of pre-packaged services, and it becomes easier for your clients to choose from different packages rather than trying to judge whether your time estimates are accurate.
But there's something even more important about productising your services:
- No more unpaid proposals. Your entry-level offering is a roadmap exercise - this is where you do your discovery and create a roadmap your client can use whether they decide to continue with you or with someone else. Effectively a paid proposal.
- The focus is now on solving the business problem your client has, not the number of hours you're going to spend doing it. This is - in your clients' eyes - a lot more important (and therefore valuable) than your time.
- You now have the incentive to get better and better at what you do - because it doesn't matter how long it takes to get the job done. You're charging a fixed price, so it's in your interest to get it done faster - but still deliver the same value and quality.
By productising your services, you get paid for doing proposals, the focus is on solving the client's business problem (which is a lot more valuable than your time) and as you get better and faster at what you do, your effective hourly earnings go up.
For more information on productising your services, you can read:
- Why you need to productize your services (and how it works); and
- How a product ladder makes it easier for customers to buy – and keeps them coming back for more
The Internet can make any business look big and successful, whatever the reality behind the facade. So as freelancers (or solopreneurs or small business owners), we look at people doing something similar to what we want to do - and we get impatient and depressed because we're not yet as successful as they are.
But here's the truth you already know:
It takes time to build anything substantial. Think years, not months.
Without exception, every successful entrepreneur I know of did not reach their current level of success in weeks or months. It took them years. The really successful ones have been around for a decade or more. And that's probably the real definition of success - still being around after a decade or more.
It's easy to get frustrated because things are not happening faster. We're impatient to move ahead, make more money, get more people to follow us on LinkedIn or Medium or Twitter or Facebook. We blame ourselves when it doesn't happen as fast as we want it to. We look at people who are able to go from zero to hero in a month and we wonder how they did it - and we buy their "success in 90 days" course.
But none of them went from zero to hero in weeks or months. The ones that are really successful put in the hours, the weeks and the years. Because that's what it takes.
Being impatient is not a bad thing. It's what makes us push forward harder and overcome obstacles when others would have given up. But still it takes time. So be impatient - by all means. But when you get depressed or frustrated, remember that it took everyone else years to get where they are today.
It will take you years as well - but here's the good news: It's only the first year or so that is really difficult. After that, you will have established yourself and have some steadier form of income. And even though you may not be where you want to be yet, you're over the worst.
Over the years working as a solopreneur myself and with many small businesses, I've seen these three common elements to everyone who is successful:
- specialise in a niche so that it's easier to become an expert, find your ideal clients and make it easy for your clients to find you;
- productise your services so you can charge more and deliver value faster; and
- remember that it takes years to build something of substantial value - enjoy the journey.
I hope this has helped you. Of course there are many more things that make a successful freelancing, solopreneur or small business, but these are the most important ones I've seen working with businesses.
If I had to pick one thing above everything else, it is to enjoy the journey. I know that it's not fun when the cashflow outlook is dim and clients are few; these are things that put pressure on us to fix the things we're not good at yet. And then we can have more fun.