Being a business owner can be extremely beneficial: You can raise your income, but still enjoy all the benefits of being self-employed. However, the transition from freelancer to business owner is not easy and requires a lot of work. Learn how!
It’s no news for anyone that freelancers are changing the working scenario all around the world. By being disruptive, new economies are opening and a new era of people who are set on living by their own rules is starting. Personally, I think it’s fascinating how the new generation takes on working as part of their life, instead of living for work.
There are many reasons to start freelancing. Maybe you just want a side business. Perhaps some extra money while you study. It might be that you had to do it out of necessity. Or maybe you just chose to pursue this path and never looked back.
Because let’s face it: freelancing rocks. You get to chose your own schedule, the place where you work from; and if you are really good you can even have the luxury of choosing your clients and the projects you work in. Not to mention charging fees way above your peers!
However, not everything that shines is gold, is it? Before that you will have to face many clients from hell, put up with nasty working hours, and deal with the worst enemy of freelancing: the feast and famine cycle.
And there comes a time when it just gets to you. You reach a breaking point. And it is in that moment when you have to decide to go back to a 9-to-5, or do something about the way you work.
You need to become a business owner.
When do you become a business owner?
A freelancer is technically a gun for hire: you are hired for your technical skills, usually per hour. But as a business owner you understand that being proficient in a field is only a little part of the puzzle. Going from one to another begins with a mindset shift. Personally, I got to a point where I understood that I was still changing hours per money: if I wasn’t in front of my computer, there was no money coming in. And suddenly, all the freedom I felt as a freelancer disappeared.
As a freelancer, the cycle is something like this:
– Search for clients/projects
– Have an interview
– Do the project
– Get paid
You will find soon enough that there’s only so much money you can make this way. While there are no set rules in freelancing as how much to charge or how many hours to work; you do respond to market rules. You still need to deal with competition and marketing. Sadly, most freelancers only focus on the next step of the cycle, instead of thinking strategically on how to create scalable systems.
Thinking for a solution to the dreaded feast and famine freelance cycle was a game-changer in the way I do business. While it seemed like a natural step, it marked the beginning of my career as a business owner. And let me tell you, it was a game changer!
From freelancer to business owner – The transition
Transitioning is scary for many freelancers. And I get it, changing the way you work specially when your income depends on it, is a risk. However, you don’t have to do it blindly (like I did).
1. Think in terms of problem-solving
Being a Business Owner doesn’t mean that you have to hire people to work for you and become an agency. There are a lot of one-person business. The big difference between being a freelancer or a solopreneur is the way you think about your services and how you offer them.
Chances are that you know the ins and outs of the technical skill you currently sell to your clients: graphic design, web development, copywriting, etc. You are hired to do something with that skill, but usually your involvement ends there. As a business owner you will stop marketing yourself as a skill, and focus on solving problems for your clients.
Let’s say a client hires you to create their website. What’s the real problem behind that project? What’s the “pain” of your client? Do you think he or she just needs a website, or needs a digital tool that works as the main point of their online presence?
2. Think about who you solve problems for
As a general rule, freelancers work with mostly anyone that comes knocking at their door. Having fear of niching down is very common: you think you are leaving work on the table. But choosing an ideal client has a lot of benefits for a Business owner:
– You know who your ideal customer is and how you can better solve their pain.
– You can create a marketing strategy specifically aimed at your niche, attracting the right clients at your door.
– You can be seen as an authority. Position yourself as the go-to person for a specific solution will drive clients to you, instead of having to go out and look for them.
3. Create a business plan
Freelancers tend to work “as it comes”: they never stop and reflect how to optimise and place systems that make their job easier. Creating a business plan to understand how your business works allows you to identify which tasks can be automated, or even outsourced. Good systems save time and money.
4. Think beyond your skills
As a business owner you are in a position where you are not limited to generate income just by working on project. When you think in terms of problem-solving, you also open the door to deliver solutions in different ways. Creating products, courses, or other income sources are the scalable part of your business, and what eventually will take you from exchanging hours per money to earn passive income.
What can you expect
Being a business owner has proved to be extremely beneficial in my career: not only my income skyrocketed, but I still enjoy all the benefits of being self-employed. However, the transition was not easy and it required a lot of work specially at the beginning. I think though that it’s inevitable at some point, especially when you need to have a more stable income, or the freelancer cycle wears you down. If you are really considering on making the jump, looking for a business coach is a good start. Someone who takes you by the hand and helps you create a business you are proud of.
What do you consider yourself? A Freelancer? A business owner? Have you thought about your career in the long term? Share it in the comments!
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