Why Freelancing Isn't the Dream It's Made Out to Be

I started out freelancing and eventually built a consulting firm w/ a partner, I left around 50 people because selling time for money just never got fun.

Took a business partner, a couple engineers, and one of the products we had built for an old customer from the consulting firm (on good terms!) and built an enterprise SaaS product out of it, much happier working working with a small team on a product.

For me the value of working on lots of things was meeting lots of people I'd like to continue working with and getting product ideas.

It depends on the type of your contracts - there's also longer-term contracts out there (at lower hourly rates).

You can do any mix of those (if you can find them) - ideally, you've got long-term contracts that cover you basic income needs, and do short-term contracts or product development on top of that.

Regarding the feast or famine cycles - you need a very healthy cash cushion.

And speaking of health, that's a risk in itself. Long-term health issues that prevent you from working as much as you need to will drain your cushion.

Long-term freelancer here (several decades) who has almost never been a full-time employee. While the points in this article are generally true, there is much variety in the world of freelancing that isn't touched on here.

My first few freelancing jobs were basically full-time, working for one client at a time. While I didn't get benefits (health insurance, paid vacation, stock options, extra overtime pay), I did command a fairly high hourly rate which made up for that.

My time wasn't monitored as closely as that of a full-time employee, i.e. if I came in at 10 am and left at 4 pm, I got paid for that time (minus lunch) and nobody cared, as long as I got the job done. Conversely, if I worked from 9 am to 11 pm, I got paid for all those hours (minus time for meals, of course)!

Eventually I got smaller clients/projects, but more of them. These days my situation is much closer to that described in the article. However, I'm in a much different position financially now than I was then, and am okay with the large fluctuations in work.

If work starts to dry up, your safety net is to get a full time job, like all the other working stiffs out there. You have been building your skills as a freelancer, especially during dry spells, haven't you? So theoretically you're well positioned to apply for a job. There's also unemployment benefits, which vary by country of course, so hopefully you won't end up on the streets unless you suffer setbacks well beyond your control.

If I had to give advice to somebody who just started freelancing, it would be to save as much as possible as early as possible, and to stash as much as possible in a retirement account and the rest in an investment(s) that will be relatively safe in the long term. Ask your accountant and financial planner for specific advice here, but long story short: index funds like the S&P 500.

I’ve been consulting for 4 years with considerable success so you could say it’s kinda “freelancing long term”. Whilst I originally was stressed about the need to constantly seek new projects/clients, it’s stabilized a little bit and I have built up some savings to at least give me a buffer. For managing internal stress, I’ve turned to Buddhism to help keep me going through tough times but also realized that reputation and client base has played a key role in me keeping this up long term.

My client base is a mix of startups and enterprises. Enterprises have given me longer term projects and have deeper pockets which reduces income unpredictability. The good work that me and my team does also provides us with good referrals and case studies that we can talk about with future customers.

As a solo consultant at the beginning of the journey, I adopted the mindset of being a 1 person business and acted like a business which meant doing sales/marketing activities (i.e. built partnerships, strategize to focus on value propositions, act like an advisor) to keep things going.

Happy to answer more questions!

I've done both - built a software product and company around it, as well as consulting (including some big projects like one processing $1B/mo in payments).

>>how do you manage the stress of income unpredictability<<

By squirreling away as much as I can from those "feast" times.

I've found many people I meet on fixed incomes who haven't been through the "feast or famine" cycle you mentioned don't appreciate just how hefty a safety net it takes to feel secure. I keep seeing naive guidance out there in the range of months, where personally I was looking out in terms of 1-2 years (or more). It necessitated significant sacrifices when I was starting out, in terms of disposable income, homeownership, etc. I was young, so my personal needs were really frugal.

>>do you find it sustainable long-term<<

A few things that helped make it sustainable (this is looking back in retrospect - it's not like I was deliberate about sustainability at the time as I was busy trying to make a living, build up a reputation and fiscal capital, and most importantly make cool new things):

- Personal flexibility in terms of scheduling 'vacation' time. Got a couple months without anything on deck? Great, spend 6 weeks catching up on work you let slide while you were insanely busy on the last consulting gig, then take two off and travel or do something else to recuperate. I always struggled to be 'truly' disconnected, but clients tended to recognize how hard I work to make them happy and were supportive (i.e. tried to be a little more self-sufficient while I was away) - and it's still possible to have a great trip while checking in from time to time (I recall a couple weeks in Boracay where I'd be on email all morning then kitesurf in the afternoons).

- Innate satisfaction from pleasing clients and from building new things. Money isn't the only reward out there to hit your dopamine. You already mentioned diversity in projects, which falls in the same vein as this.

- Being open to long workweeks when times are busy. It's not a clock, it's about achieving the objective (have logged 80+ hours for weeks at a time - if you're excited about and deeply committed to the work it's not as bad as it sounds). Billing hourly or some other remuneration arrangement that leaves you feeling compensated for your time is really important here.

- Exercise - find a physical activity that helps burn off your stress.

- A bit of hubris around selectivity. Don't get a warm fuzzy feeling from this lead? That's fine, skip it and look for a different opportunity. I think the sense of control and agency here is something those at regular day jobs sometimes miss. Of course it takes going through some crap projects to get to where you can recognize and filter on the good ones.

- Reputation. A lot of the stuff that was hard at first becomes easier once you're established and can leverage a network of thrilled customers and partners. I don't advertise anymore, and get more opportunities than I can handle from word of mouth. I turn down more work than I take on. (Of course as you grow, you get a new and different set of hard challenges to tackle).

I toyed with having employees on the consulting side, but as I worked with larger clients I unexpectedly found it sometimes worked better to "commandeer" staff directly from them for a project (especially if you've got buy-in at the C-level). One thing I've learned is I much prefer working with a small, talented and focused team than an 'army of mediocrity', and lately have charted course back into the product realm.

>>or is it more of a stepping stone<<

Everything we do in life is a stepping-stone to where we'd like to be. Some stones give way, some hold unexpected surprises when you turn them over. One way or another you're going to get your feet wet.

I'm doing various forms of small business including freelancing for 20+ years. Some of these years I was working as a consultant for one client, a few years were primarily focused on own products, some years were "pure freelancing" similar to what's described in the article. Now again working primary for one client but still managing my own products and taking small gigs on the side.

Except in the beginning, I've had no issues with income but as the others said you need safe cash cushion and financial discipline.

Context switching and overburning is a problem but ask any small business owner outside of the IT and they'll tell you something alike.

Freelancing is just a form of small business and small business is hard. But the level of freedom is higher than that of the employee.