This is going to scare the pants off of you, and I'll get downvoted into oblivion but:
Give your first client a free website.
Give your first client a free website.
(a) You get to start out with client who, because of the adverse selection effect, is most likely to be demanding and troublesome.
(b) Your relationship with that client, which may appear peachy at first, is now poisoned because you've sabotaged your rate. Rates never go up.
(c) At the point where you're at your most vulnerable, you end up doing high-stake work for almost no immediate reward.
Let me just throw a couple things out here:
* People who buy professional services for their company are usually not spending their own money. They don't have the same personal relationship to what they're spending that you have to what you're receiving. Put differently: they're not as likely to be appreciative as you think they will be.
(I'm a co-owner of an LLC that buys professional services and this is as true for us, where I'm literally spending my own money, as it is for a Fortune-500 where money is entirely abstracted.)
* Your willingness to do a free project does not make it more likely that you'll get referrals. You think the principal of reciprocity is at play, like Cialdini says. But that's about giving people boxes of chocolates. It's not about sending a strong signal that your work is worth less than everyone else's. The good news is: if you do good work, people will refer you, even if they paid above market rate for it.
* If you can't find people to pay you for the work you do, it's better to fail fast than it is to drag it out.
I have no doubt that many successful freelancers got their start by giving away freebies. And in web design, maybe you need to do this to build a portfolio. I don't know. (Seems like there'd have to be a better way). But if you do technical work, I'd be very careful about starting this way.
However, a new freelancer may find that getting free clients is just as difficult--or even more difficult--than getting paying ones. It's the same process.
In that case they could probably go on Rentawhatever and at least make a few dollars for the effort.
Maybe offering discounted rates is a better way to bridge the gap for someone without a lot of credits.
"Give your first client a ridiculously low price."
The keyword in that sentence is "first" because you don't want to get into the habit of low-balling all of the time but it's not a bad idea when you're getting your start.
My freelance career started when I was offered to bid on a job by a friend who was working for a large sports organization in Ohio. I came in really, really low compared to the other vendors who were bidding (although, at the time, I didn't know HOW low). That one job, which I did very well for a low price, resulted in a client and work I still have to this day. And that client then turned into referrals that got me involved in an entire industry.
I did something similar - I offered to build the foundation of their website (a social networking site) for free as a trial. It only took a few nights and they liked what they saw. Shortly after, we negotiated and agreed upon a rate to continue development.
I suspect there are lots of nonprofits like this.
I suspect there are lots of nonprofits like this. Or smaller nonprofits that simply don't have websites. Soup kitchens and stuff might not be into the 21st century.
I left development to start consulting, and in the beginning I still had no idea of a competitive but profitable price stack. However I was very business minded, a week prior to leaving my field I just finished reading Dale Carnegie's book "How to Win Friends and Influence People".
Before I go further, let's stop and take a pause: this is a book that everyone needs to read, especially freelancers. I say especially these individuals because your livelihood is predicated not on a parent company managing image and taking a considerable chunk of the impact if you mess up. That being said, it is vital that freelancers read this book page for page, front and back to get a firm grasp of how to interact with people beyond "Do you need a website? Here's your website. Here's an invoice, alright have a good one". I read this book four times, and I'm reading it once more because in addition to being incredibly insightful: Dale Carnegie has a very conversational way of writing that makes this book an absolute joy to read.
Alright, ready for part two?
I had no idea of a profitable price stack, but after reading this book I had a good idea of how to approach people, propose ideas, listen to their needs and collaborate on a service that I could provide them. Still, I was stuck on what to charge. An idea came into my head, an old one that I'm sure is all over the web, debated from both sides, but an idea none the less. And this is what I told my first client:
"Before I quote you on this project that we're working on, I want to know what you think of the idea of free".
He was hooked, I had his attention. Free is an incredibly powerful word provided your ulterior motive is just. We worked together for three weeks as I helped him build his business, and as the time grew near for my involvement to end I gave him another incentive.
I offered him 5% on the next sale if he recommended a client that signed a contract to procure my services. By this point, I figured out that working on a retainer after concluding a 'sale' and ending a contract with a very happy client would be easier to secure than a rate structure that was predicated on the idea that I might end up having to bill more hours than was anticipated. The caveat was that he give no indication to whoever he would refer to me that he got free services, that was up to his discretion. I did not give him a line, a pitch or any sort of script. He ended up with $375 in his pocket, and a new customer.
He ended up becoming my personal accountant.
Thanks for sharing and for the Dale Carnegie recommendation!
Why not just build yourself a website and put that in your portfolio rather than giving it away. Build a reviews site for some niche.