Why freelancing is broken and how to fix it

The most common question I’m asked is ‘how do I make freelancing more stable’ and my answer is always the same:

Simple, don’t do freelancing the way you’re told to do it

You’ll make it more stable when you stop this self imposed limitation on the business growth you’re capable of. Whether you’ve come to terms with it or not, billing by hour (with it’s inherent limit of only having so many hours in a day/week/month) is putting a physical ceiling on your earnings.

Moreover, if you are targeting a monthly earnings amount which depends on you being 100% full to ever be achieved you’re always going to be playing catchup – queue feelings of instability.

This is the paradigm, the norm. Swapping time for a pre-set hourly amount. It’s compounded by a world of blog posts brimming with ideas on “raising your hourly rate” which is really attacking the problem the wrong way around.

Freelancers have constraints just like any business so it’s important to realise what these are and use that insight to your advantage. It took me one failure and joining a corporate, being immersed in big business thinking to figure this out… That straight out of the box the traditional freelance model, the way we’re “told” to do it is unstable.

An epiphany

All of this limits the growth you can achieve and contributes to an earnings ceiling which brings with it feelings of instability and a constant “looking over your shoulder”. Will I make my mortgage payments this month? What about the savings we’re trying to build?

It’s hard. This was where I was, stuck in an hourly rate hamster wheel, a position I call “maintenance mode”. On good weeks I was punching the air and planning world takeovers but as with all famine & feast seesaws the bad weeks bring with them a sense of primal fear at the very pit of the stomach. I can still feel that now. This tore me to shreds my first time round as a freelance designer & marketer.

In the end the instability got me and I threw in the towel to take up a role within a corporation. This most painful recollection actually carries a silver lining though, while trapped in cubicle city I began to notice something, the inner workings of the corporate machine. It was fascinating. Being a relatively free spirit (I’d been self-employed my whole life up to that point) I wasn’t indoctrinated into the herd culture which seemingly all of the zombies around me were blinded by.

It was fascinating. Efficiency at every turn, a crystal clear vision, an intense hunger to dominate a market. Laser targeted strategy and clear roadmap to meet goals.

To cut a (very) long story short, this insight brought me to an epiphany… what if you took that same big business approach and combined it with the agility, love and personality of a freelancer?

The next day I quit my job and I haven’t looked back since.

Unboxing the constraints

So within the “herd” I’d seen one side of business, then back out in freelance-land what I came back to was a very different landscape. This brought me to the realisation that the “norm” could actually be hurting us a way to do business. From where I am right now there are three main constraints with “freelancing as usual”.

1. Time

In order to generate revenue you need to invest time in building the desired outcome for your clients. Obviously this is what you signed up for and if you’re anything like I was, nothing topped the feeling of working on a really great project.

This comes crashing back down though when that premium time is disrupted by general business activities which you don’t ultimately get paid for.

It’s at this point time becomes a constraint. You are required to sit at the centre of every process, decision or action which limits the amount of time you can spend on client projects.

2. Necessity to find new clients

You’re in business now right? So it’s all on you to go out and find new clients. The difficulty comes when the pressure to get new clients outweighs the pressure to stick to your prevailing hourly rate.

Too often the churn of clients is so high you take on as much as possible given this low rate, disintegrating your earnings potential.

3. An expected “fair market” rate

This is a difficult one, you load up on posts, tools and calculators all pointing you to a ‘magic number’ your hour is worth. But in line with the two points above, your time is stolen from under your nose with tasks you don’t bill for and mass competition drives you to lower this rate to ensure you are winning new clients.

These three constraints running simultaneously gnaw away and give you that feeling of always looking over your shoulder – feelings of instability which lead to that most common of ‘sensechecks’.

“Is it really worth it?”

So what can you do? Well, like anything you face head on it’s not so scary when you know it’s there. Armed with that insight, let’s look at common sense strategies to overcome these primary constraints and make freelancing work for you.

Rethinking ‘freelancing as usual’

I’ve been able to reshape my worldview on freelancing and with some compound mindset changes you can leverage this insight. Here is my abbreviated take on this rethink:

Time fix

If demands on your time is a constraint let’s try to remedy that by taking you out of the chain.


Look to build a secondary or more diverse income stream that can exist and make revenue without you needing to be present to action & deliver them. Specifically I’m talking about building products.

Then consider getting really efficient with your primary work. Understand that everything you do can be expressed as a process and that some links in that process chain do not 100% need your involvement. So do your best to leverage a remote team to deal with those mechanical elements of your primary “product” (your freelance service delivery).

Finding new clients fix

If you’re finding yourself in a sea of competition, battling with lower priced competitors from other regions of the world you’ve got an underlying problem with specificity.

Aim to build a category of one, get really specific about your customer and build an online reputation in the circles that customer operates in.

Build value and a trail of breadcrumb content back to your site. In doing so you’ll rise above the noise making it easier to promote yourself and find clients.

“Fair market rate” fix

This is the bug bear. Get this right and you’re starting to make the compound moves that’ll free you from the income roller coaster altogether.

Understand that the service you provide has value and you’re only being engaged to provide that service because you’re making a difference to your client.

That is to say you should base your whole pitch around the benefits working with you has. Think long and hard about the value you’re providing and express it explicitly.

Then base your price (as a full, delivered job cost – definitely not split by hour) on the value you’re going to deliver and price it as a project.

So in closing, this is the tip of the iceberg of of the kind of no BS growth ideas you’ll find at Freelancelift – I’ll dig into all of these constraint fixes much more thoroughly as the content on the site builds up.

These are primary drivers for everything we talk about here. These are compound changes you can put to work in your business right away and we’ve developed video, audio Q&A, blog posts and playbooks to help you make those moves in the quickest, most efficient time.

Each of the points above carries lots of supplementary reading to support you in really making freelancing work for you, to break away from what does/doesn’t work for the rest of the herd.

Learn anything? Please share

When you’re held ransom by client work and income instability how are you supposed to find time to work on “growth” (whatever that means).

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  • http://www.poldberg.com/ poldberg

    Thanks for the good read. I’m currently stuck in the hourly model and I deal with a lot of sensitive data. How do you recommend building products or enabling remote teams when limited by confidentiality agreements and PII data?

  • Liam at Freelancelift

    Great question. My take on processes is relatively straightforward in that I propose not passing on a full task ‘as is’ – more creating a chain of events for every business objective.

    You should only build a remote team around key links in this chain which don’t 100% require your involvement. In the case of confidential matters, the sensitive areas of the process need to be handled by you but I’d hazard that there is at least 40% of the process which could benefit from external support.

    I laid out my approach to processes in the post linked below – lemme know if you need any further information here!


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