Bootstrapping principle #3: Freelance over full-time

Filed in archive Bootstrapper Resources on September 22, 2008

© douglemoine

As anyone in an operating business can tell you these days, hiring freelancers or subcontractors can sometimes be a better option than full-time employees.

So it should come as no surprise that bootstrappers must sometimes rely on freelance over full-time workers and should be careful when it comes to hiring. Here's why:
• Hiring freelancers can make it easier to control cost. Obviously, keeping track of the number of jobs assigned and a clear understanding of the fee for each service makes it easy to budget cost of work. Lack of ballooning health care and other costs could increase the amount you must pay for freelance work, but won't hit you immediately as it does with full-time employers.
• Freelancers are bootstrappers too. Freelancing or subcontracting are among the easiest ways to start a fledgling bootstrapping business. They should understand the challenges you face and work harder to control costs for you just as they do in their own businesses.
• Full-time employees mean more overhead. Health care costs mentioned above are only one example of this. Place for employees to work also sometimes requires a physical office-more overhead-and of course wages or salaries becomes another fixed cost, often one of the biggest, of continuing to operate your business.
• Most things can be outsourced. Yes, even office support, at this point, need not be done in an office (see our own posts on the VA phenomenon) a kind of freelance office manager. Of course, software design, manufacturing and phone support probably go without saying.
• Cost/effort ratios a bootstrap ideal. Probably the best thing about freelance work is that it can be argued every expense is related to a completed task adding value to your business.