Hey everyone,
I'm a full stack JavaScript dev in London with 10 years experience, working as a tech lead in a big company. Because of the Coronavirus directly impacting our revenues, we are being put at 80% pay / 80% time.<p>Do you think in the current climate it would be doable to start freelancing / consulting? I've already got an LTD setup because I used to be a contractor, but would like to look at turnkey work, where I'm given a project for a fixed price.
<i>> we are being put at 80% pay / 80% time.</i><p>Uhm, you want to check the fine prints. If you've been <i>furloughed</i>, which is typically what people on "80%" are, then <i>the Treasury</i> is paying your salary, but you're NOT supposed to work AT ALL. If you are actually working, you and your company are effectively committing benefit fraud.<p><i>> Do you think in the current climate it would be doable to start freelancing </i><p>Everything is doable with enough grit and enough resources; IR35 is a big concern though, because it has cut demand significantly by scaring companies away from contractors - even if the postponed changes are postponed again next April, HMRC will keep the finger on the trigger.<p>This said, this is probably not the right time to sell in general; it's the right time to buy / invest / build while prices are rock-bottom.<p><i>> would like to look at turnkey work</i><p>That's not a great move at the best of times, unless that "turnkey" is highly automated (in which case it's likely to go away soon as somebody starts selling the fully-automated version). Fixed-price is a recipe for getting screwed.
The requirements to start as a freelancer, in any kind of economic climate:<p>* You have an accountant<p>* You are not afraid to draw up a contract<p>* Have a skill that has higher demand than supply and will remain so for a foreseeable time<p>* Have worked on paid side projects a few times<p>* One existing customer is interested in hiring you for 3 months (worth of money) or more<p>Ensure you set aside 50% of which 2/3rds for tax and 1/3 for bad times. Maybe you pay less tax in the end. Yay! "Free" money! <i>Never get in the reverse situation.</i><p>If you don't have customers: don't do it. I have been making a lot of contacts in the 15 years+ I have as a professional and it's still hard to find work right now. If you're good for a few months then we're out of the pit in terms of demand for sure.
Contract work has been under attack by IR35, fortunately this has been postponed by a year.<p>These are uncertain times. A lot of contractors have moved back to permie and competition is high.<p>You can try to obtain a 6 or 12 month contract if you have a decent stack of emergency cash (e.g. £25k) lying around.<p>I wouldn't overanalyze it. Try to see your options out there.<p>If you can get 3 contract offers in 1 month, then obviously you're still fine. If you can get 1 contract offer after trying for 3 months, I'd consider not taking it.<p>Analyze and feel the market, so you can form your opinion instead of just going based on stories that other people produce. Some people can't find a low-paying job in the best of times. Some people will have plenty of opportunities in the worst of times.
The contract market in London is in a difficult place at the moment. IR35 has generally made buyers weary (in a way they weren't before) as well as limited the type of work contractors are given; budgets have also been very tightly squeezed because of Corona, it's hitting contractors pretty hard.<p>As a 'buyer' of these services myself, full-stack JS dev contractors are in one of the most oversaturated parts of the market and many in my network are attempting to find full-time work at the moment. Those that aren't are having to compete on rates in a way they never have before, definitely a buyers market.<p>The other side of this is how much more volatile contractor work is than before, many companies with a mixed full-time/contractor team see their contractor pool as the most 'expendable' when cuts need to be made. Many people in my network have had existing long-term contracts ended with little to no notice.<p>I've also seen limited evidence the pushing back of IR35 to next year is changing the policies towards contractors at large corporates, where (by volume) most contractors get their contracts.<p>In short, I don't think it's the best time, but: if you do make the jump, make sure you have contracts SIGNED before you make any big decisions. Not a hand-shake or an email, a written contract. If you can get that, then you'll be in a good place.
Definitely. With such an economic contraction, you're going to see companies hiring contractors for a while because they don't have to commit to the full overhead of an employee. We saw a huge influx of freelancers in 2008-2009 and as the economy grew pre-covid19, more and more freelancers took jobs at companies because of salaries, benefits, etc. We will very likely see a repeat of that.<p>Things to make sure of: make sure your rates take into account your overhead. You're going to have to pay for your own insurance, pay withholding taxes, business licenses, account for some time off/sick days, etc.<p>After years of freelancing, attempting to set aside money for taxes and <i>never</i> paying into retirement, I started using an app called <a href="https://www.catch.co/" rel="nofollow">https://www.catch.co/</a> to track all of this and it allowed me to focus more on freelancing and less on the overhead.
If you can find clients to hire you, anything is possible. I started freelancing during the Great Recession (because I couldn’t get a job) and was able to make it work.<p>Find at least one client before you quit, though. And make sure you have at least 6 months of savings so that even if that client fired you on day 1, you’d be okay.
From my experience in the last 2 months, companies are scaling back their IT projects now. Got several contracts that were supposed to start later this year and they were canceled.<p>So there will be more competition for less bread. But you can try.
My sense is that freelancers become a lot more attractive in the short / medium term because:
- WFH / remote work will be the norm for a while, and if there's no benefit to having a FTE in the office with you, why not contract lots of work out?
- freelancers are a lot more flexible in terms of overhead than FTEs, and the economy will likely be jittery for a while
Just anecdotally, I've been hearing from friends that work from Upwork hasn't been affected from COVID. I think platforms like Upwork/Fiverr might even be more enticing for employers during recessions. Of course the pay there is not very competitive, but just giving you 1 data point.
I say (from experience) during hard times is the best time to start.<p>You will not be lured into massive fixed costs and start with the absolute minimum and required, which you can scale up when your business start flying.<p>As long as you start tight, you will stand a good change.
Aside from the legalities regarding your employer/employment.<p>I expect more companies are going to be using freelancers for projects and tasks to minimize using employees since everything is currently uncertain.<p>I wouldn't recommend using online services to find projects. Reach out to your network (outside of your employer/co-workers) to find projects.<p>Research what to charge and how to manage your freelance projects.<p>Now could also be a good time to use your 20% time to build up an audience for future info products or start stair stepping from products to a SaaS (Rob Walling, see below).<p>You might enjoy StartupsForTheRestOfUs.com podcast, start in the archives with episode 1.<p>Build Your SaaS is a great podcast as well.<p>Good luck.
It depends on your clients. Don't put all your eggs in one basket which I did.<p>My two current clients in Germany are heavily invested in the automotive industry. They have everything on stop for the manufacturing and their software department is not working their full 100% capacity. On the other side, I hear lots of good news from people who are bringing physical services to the web. The digital revolution is just starting here and people have to keep up with more and more demand.<p>So yeah, I think there is lots of opportunity. It really depends on who you are aiming for as clients.
You have a network for sure and a lot of relevant people are still however working, so just spend a couple of days networking from home, making cold calls and preparing a portfolio?
It's completely dependent on your ability to close the deal. If you can get the business then yes, if not then no, and it's hard to tell which will happen without you trying to get a deal signed. I'd recommend reaching out informally to places you have contacts and going from there. If you get no traction then you know the answer.<p>Also, make sure you setup the contract with short milestones as some companies will slow in paying.
i used to be a contractor in 2002. I was not a big success, but it paid my bills for that year. If you have similar inclinations then my advice is to stick with your current job, as long as possible...