Freelancing vs. Being an Online Solo Business Owner

Just a few years ago, if you owned a solo business and contracted your time and expertise out on an hourly basis, you probably called yourself a freelancer.  You worked at the request and followed the instructions of your clients.  Your job was to follow their requests.

Maybe you were good at writing, or typing, or graphic design, or legal matters, or doing research.

Whatever the skill and credentials you possessed, you found you were able to hire your time out to others on an hourly or “per job” basis. It seemed pretty nice at the time.

Hopefully, you enjoyed whatever it was that you did because you were being paid to perform that function over and over again as you were able to produce and as your time allowed.  Typically, the more hours you spent in someone’s service, the more you got paid.

Freelancing offered a way to choose your “job” both in terms of the subject you were dealing with and also the project you worked on.  In addition, you were able to choose who you worked for.  Impossible clients could be avoided for future work once your identified who they were.

Within some overall parameters (like a project deadline and a set of deliverables and specifications you agreed to), you enjoyed the freedom to work how and when you wanted, and maybe had the opportunity to add some of your own creativity and talent into the project.

You could show up for work in your jeans and take the afternoon off for a round of golf if you wanted to because you worked out of your own office or your home office.

It was pretty cool working for yourself!  Right?

But wait a minute . . . is that really what you were doing?

I’m not knocking being a freelancer, but in some ways, at least, that business model seems suspiciously like you are being someone else’s employee.

Why?  First, you only get paid what your employer says your time is worth – an amount you both agreed upon.  You may have requested more funds for the project, but if your client didn’t agree there was no contract signed.  That can be a good thing if you set your fees very high and only work for those who accept them. But open competition sometimes forces freelancers to be price competitive and that can certainly limit your income.  And obviously, freelancers just starting out in their new careers can rarely command the same level of compensation as those who have many years of experience.

Second, you must conform to the project parameters that someone else places on the job. You’re being paid to follow your employer’s instructions.  Sometimes there is leeway and negotiation, but usually the freelancer sets the project requirements and deliverables.

As a freelancer, you may or may not be able to incorporate all the great ideas and creative angles you think best for the project.

Also, you will only be able to have work as long as you find work. Top freelancers may have all the work they need without having to prospect for clients.  On the other hand, many freelancers are not able to line up steady work that keeps them busy on a full time equivalent basis.

That fact alone is what turns many freelancers to seeking part time work in other fields or taking odd jobs during the slow periods.  Sometimes fluctuations and market downturns affect a freelancer’s ability to find work.

Online solo operators are different than the old freelancer model if they choose to be.  They are truly in business for themselves. They work exclusively on projects that they set up, they determine the scope of those projects, and they are paid for the work that’s accomplished without having to share the profit.  Often, a solo business owner can create products or services that can be sold over and over again without having to recreate the product.

These business owners automate business operations and leverage their time as much as they can. They are not simply paid for the hours they spend creating and/or marketing a product or service. They are paid indefinitely and without limit into the future as the project owner as long as the demand for their offerings remain in demand by the consumers in the marketplace.

Therein lies the real advantage of online solo business over the freelancer: the freelancer is paid for his time only while the online business owner leverages his time to get paid continuously (and sometimes passively) into the future. There is a huge difference!

[ Author’s note: A freelancer can also set himself up as a solo information business owner by the very nature of how he structures, designs, and operates his business.  Freelancers have the choice regarding how they want to design and execute their business models. ]

To me, it makes sense that those doing freelancing in the “old” way at least consider how they might re-design their business to include products and services that can leverage their time and effort.

To your online business success,

Steve Browne

www.SteveBrowneDirect.com