Becoming a Contractor

How many roads must a programmer walk down before you call them a contractor? It’s been about three years since I went down this (bumpy) path, and I finally have the feeling that my contracting business is “bootstrapped”. Here’s an account of my journey so far, hoping you find it inspiring!

0. Contents

Articles about contracting and freelancing usually take the form of abstract advice: how to find clients, how much you should charge, etc. This article is different, because I’m telling my story and drawing conclusions as I go. My goal is to give you enough context to judge for yourself whether the lessons I’m taking apply to your particular situation (something that would be impossible without knowing the journey’s details).

The first half of the blog post is devoted to the history of my business, trying to answer the following questions along the way:

• What motivated me to start out as a contractor? See 2020 - The trigger.
• What were the main obstacles I faced? See 2021 - The rollercoaster, about the difficulties of the beginning (later sections also mention some details on the struggle since).
• How did I end up being paid to work on open source? See 2023 - The open source year.
• How did I get clients? Part of the answer is in the story itself, by mentioning how each of my clients found me. Part of it comes later in the blog post (see below).

The second half of the article is a reflection on the experience of last 3 years, gathering lessons learned in different areas:

• Managing risk: on how risk assessment can increase confidence in the viability of the adventure, and get you a better sleep.
• Communication and finding clients: on the importance of clear communication and a supportive network (complemented by a short section on Recruiters).
• Rates and negotiation: on charging more and losing the fear to negotiate (includes a plot of my relative rate over time).
• Growth: on how starting your own business can change you.

And now, buckle up!

1. History

2020 - The trigger

I never considered myself to be someone of the entrepreneurial kind… It happened somewhat by accident. At that time, I was happily employed as a full-stack developer in The Netherlands, and expected things to stay like that for the foreseeable future. But life had a surprise for me in stock.

For many years I had been involved as a volunteer in a local initiative very dear to me and in the course of 2020 I was proposed to lead it (starting in 2021). The required time commitment was of 2 days per week, which is difficult to combine with a “normal” job. After some thought, I became convinced it was worth it and decided to make it happen.

The first thing to do, then, was to explore with my employer the possibility of reducing my work week to 3 days, in order to free up the other 2 days for volunteering. Unfortunately, they didn’t see it as a viable option, and I was left with the choice to either give up the volunteering plans or to give up my job. Since I really wanted to volunteer, and I felt the risk of starting my own business was manageable (see managing risk), the logical step was to resign. That marked the start of my journey as an independent contractor, and I set out to find projects that gave me the flexibility I needed.

2021 - The rollercoaster

Beginner’s luck

Around the time I decided to resign, I knew my friend Niels wanted my help developing chemical laboratory automation software. We negotiated the terms and worked together between January and June 2021. He entrusted me with a new project and asked me to drive its development from gathering requirements to implementing a working software package. This was very much in line with my skills, and we were both happy with the results. There was, however, no more work for me to do after that project. I had to move on.

Finding my second client, take one

During my time with Niels, I was keeping an eye on other possible opportunities for contracting. My hope was that something would turn up, so I could start with the next contract right after finishing the project. Despite my efforts, however, I still hadn’t found anything when my collaboration with Niels came to an end.

Unemployment

It took five months to finally find something.

I didn’t worry much at the beginning, because I assumed the problem would solve itself in due time. I happily spent the days educating myself on how to run a business, playing with new technologies that might prove useful later, and even reading some philosophy (good old Plato and John Henry Newman were my companions).

As the days became weeks, and the weeks months, I started to worry. Financially, I had reached my income target for the year, so that was not a concern. However, not being able to work for paying clients put quite some psychological pressure on me, more than I originally expected. In October my morale reached its lowest level, and I decided to try something new…

Finding my second client, take two

It must have been on Hacker News that I first heard of Toptal, as a way to find clients when you are starting out as a contractor. The quality of the platform was contested by part of the HN crowd, but since my alternatives were running short I applied anyway and hoped for the best. After passing their long selection process, it took me only two weeks to land a contract (for 3 days a week, as I wanted). I charged 85% of my original rate, a compromise I was willing to make at that point.

2022 - Smooth sailing

Flirting with Silicon Valley

The project lasted 6 months, from December 2021 to May 2022. It was a remote engagement for a San Francisco startup, and restored my trust in the viability of being a contractor (you start getting doubts when no one wants to hire you 😉).

Most of my time went to writing a from-scratch implementation of the MySQL wire protocol in the form of an easy-to-use library. This was an eye-opener for me. Until that moment all I had heard from the industry was: “we need more web developers!” Now I knew I actually had a choice. I could get paid to develop libraries!

My third client

During these six months, I kept as always my eyes wide open for potential contracts. Things went better this time and, at the end of the engagement, I had three potential customers to choose from. The luxury! My San Francisco client wanted to repeat (with a new project), and two Dutch companies came with interesting projects (they found me through former colleagues). I went with Seamly, one of the Dutch companies, and spent the next 6 months developing a communications platform in Elixir. That made for a very smooth 2022, certainly compared to the 2021 rollercoaster!

What about Toptal? I gradually became convinced that their interests were not fully aligned with mine, so I decided to only use them again as a last resort… And have never needed them since!

2023 - The open source year

An unexpected proposal

In November 2022, a comment on r/rust snowballed into a potential contract to work on an open source Rust project. Initial conversations with the company proved difficult, however, as I was failing to communicate effectively about my previous experience with Rust and open source. That made me realize I needed to revamp my website, allowing people to know more about me and my background (the internet archive shows a clear difference between before and after this moment). Next to a hire me page (which has evolved since), I started blogging again after years of silence, opening with How I got involved in the Rust community. It enjoyed some hours of fame on the HN frontpage and triggered lively discussion.

The engagement didn’t go through in the end 🥲, but the investment in a more ellaborate website paid off. A guy called Tim (hi Tim!) was very impressed by my articles, emailed me out of the blue and hired me to do mostly open source Rust work at Prefix.dev. It was a timely blessing, because my engagement at Seamly was about to end, and otherwise I’d have been unemployed again.

Open source streak

The contract for Prefix.dev lasted from January to March 2023, and was to my utter surprise followed by more open source engagements. I spent:

It never had crossed my mind before that I could get paid to work on open source! Now I discovered companies were willing to hire me to boost open source projects: designing, implementing and polishing features that would otherwise be postponed because of limited developer bandwidth. Maintainers where delighted, too!

Not all was roses, though. While I managed to have no gaps between the contracts, there were also uncertain moments with a real possibility of not having work for some weeks (or months). That’s part of the adventure, I guess, but it’s still uncomfortable. I’m happy my current contract lasts till the end of the year so I can relax a bit!

2. Looking back

Managing risk

When I made the jump, the immediate trigger was the need for more flexibility. That was not enough to start moving, though. My risk-averse nature wanted some assurances before giving up the comfort of a normal job.

There were plenty of risks to take into account. The risk of not finding customers after Niels. The risk of the contract for Niels not panning out after all. The risk of not being paid on time. The risk of having only low-quality projects. The risk of losing inner peace and falling prey of stress. The risk of being ill, and therefore not getting paid. The risk of… you name it.

Since I started out anyway, you might be asking yourself what else moved me towards taking on these risks. The list below summarizes my primary considerations:

• I hoped to be properly rewarded: financially by earning more, socially by meeting new people, intellectually by having many learning opportunities, personally by enjoying a higher degree of flexibility (I even played with the idea of writing a book in my spare time).
• My financial situation was such that I could survive for a whole year without income in the absolute worst case scenario (not pleasant, but doable).
• The job market for software developers was booming and I was on a good footing with many former colleagues. I could easily get a normal job again, if it became necessary.
• In my daily life I was (and still am) surrounded by people who love me and care about me, making it easier to bear the setbacks that are inseparable of any entrepreneurial undertaking.
• I was convinced God would have my back. By this I don’t mean I was expecting success, but that I knew I’d receive the strength to face any obstacles, and was certain that the adventure would lead to growth regardless the outcome.

In my eyes, this is a pretty strong collection of assurances, enough to outweigh the risks and make them bearable.

Communication and finding clients

Jacques Mattheij has an inspiring article about finding clients, where he says: Customers will establish your reputation, which will bring other customers, but how do you get your first batch, it’s the proverbial chicken and egg problem. This has proven true in my case: it is a chicken-and-egg problem, and it does become easier over time.

Next to establishing a reputation, it also requires communicating clearly about the services you are selling. You need something more specific than “hey, I’m a computer wizard”, if you want people to remember you. This one was terribly difficult to figure out, and for about two years I simply didn’t have a good answer when people asked about my interests and expertise. Only by the end of 2022 did I come up with something I was happy with (see open source streak above). It brought me the first customer from outside of my network, and positioned me as a capable open source player, which must have had a role in landing the rest of 2023’s contracts.

So if it is a chicken-and-egg problem, and it takes time to figure out your value proposition, where do you find your first clients? In my personal case, I got them either through recruiters (once, on Toptal) or through previous connections (friends, former colleagues, people I’d met at meetups, etc). Folks who had worked with me in the past were the most helpful, as they knew what I was capable of and had a pleasant memory of our collaboration. Some even sent opportunities my way without being asked. Thanks for that, you did me a great favor!

Recruiters

What about working with recruiters? Despite the (often deserved) bad press they get, I truly believe they have a task to fulfill in this world. Unfortunately, I’ve never found one who took the time to understand my value proposition and wanted to help me find a contract for 3 days a week. I’m still interested in exploring a long-term business relationship with a recruiter who is willing to work with non-standard requirements, and who is a good professional (please do get in touch if you know anyone who’s suitable!).

Rates and negotiation

My view on rates is heavily influenced by an experience I had as a Computer Science student. The father of a friend asked me to solve a programming problem, and he refused to pay me the modest student rate I proposed. He said, instead, that I should charge him €100 per hour (about 108 USD as of this writing). So I did, and learned that you should price your services according to the value they deliver to your customers, and to look for customers that greatly value your work.

This view was further expanded when I came across Patrick McKenzie’s (aka patio11) writings on the subject. Here’s one of his quotes (source):

Rates exert gravity.

If you charge more, you’ll spend your time talking to more sophisticated clients, working in better businesses, specializing in projects close to the money. These are compounding advantages.

If you charge less, similar dynamics apply.

Now one of the biggest obstacles when applying this advice was fear: fear that prospective clients would run away when I mentioned my rate or that they would call me out as a scammer. Reality proved me wrong: they all either accepted my rate or negotiated! I discovered that negotiation can be a constructive dialogue. The customer might be unable to match my rate for all sorts of reasons, and I might give them a discount if they can offer something valuable in exchange. For instance, one company offered me the possibility to stick with them for a full year, working with very interesting technology, at a time when I was very tired of finding clients and needed to recharge. I gave them a discount and took the contract, turning off a financially better offer from another company that gave me less long-term security.

As to how much is reasonable to charge… I have deliberately avoided mentioning any numbers, because they are highly context-dependent. If you like abstract advice, you can check out this article, which has Thomas Ptacek’s blessing. Alternatively, you can have a look at the plot below, showing the relative evolution of my rate over time (100% stands for what I thought my work was worth when I started out, 0% for unemployment).

Growth

My 2-day-per-week volunteering commitment lasted till early 2022, and from that point onwards it would have made sense to find a normal job again… but I didn’t go back. Something had changed in the meantime.

True, being an independent contractor had been more challenging than being an employee, but somehow I grew to love the challenge! Who would have said? Maybe I’m not that risk-averse after all, or I changed in ways that I didn’t anticipate. I’d like to call that growth, and I’m looking forward to the coming years!

3. Closing words

And so we reach the end of both the story and my reflections upon it. Was it inspiring, as I hoped? Or at least entertaining? Only you can tell!

There is much more that could be said, but this whole blog post is already long enough. With a bit of luck you will have a delicious portion of HN comments as a side dish, including much more interesting things than anything I can come up with!

Feel free to hit me up, or to discuss on Hacker News.

With special thanks to Tim, Jouke, Jeroen, Yoeri and Bart for reviewing early drafts of this post.

from Hacker News https://ift.tt/lTvgIf0