Freelancers and Startups: Myths Debunked

Freelancers and Startups: Myths Debunked

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Whilst some start-ups have been fast to embrace this opportunity, others have been put off by preconceptions about freelancing. 

Historically, management consultants were available only to rich corporations. In the past year, we’ve noticed an increasing number of start-ups interested in having an external perspective or bringing in specific freelance skills. They are increasingly turning to hiring freelancers as a way to access these benefits without having to pay the very expensive consulting fees.

Whilst some start-ups have been fast to embrace this opportunity, others have been put off by preconceptions about freelancing. I wanted to take this opportunity to debunk a few myths about freelancing for start-ups.

Myth 1: Freelancers are too expensive

All start-ups need to ensure that their limited funds are being put to good use. Freelancers are therefore rarely used as their day rates are often higher than those of a permanent hire. However, since freelancers don’t require pension contributions, paid sick days or any other benefits you may offer permanent employees, they can offer the cheaper option. You pay only for each hour worked, so you know you’re getting your money’s worth.

Additionally, freelancers can be used to solve short-term capacity problems or fill a position whilst a specific project is undertaken. Paying a freelancer to fill a position for 3 months will, of course, be much more cost effective than hiring a permanent employee to cover a workload which you envision to only be short-term. A small EdTech company recently hired a freelancer through us to completely overhaul their strategy going forward. The project was successful, took 3 months, and they were able to part ways at the end having been successful, and without having had to commit to a permanent hire.

Myth 2: Freelancers aren’t worth the investment

The flexibility of contract which allows freelancers to be effective stop-gaps or project leaders, also allows the contract to be edited, prolonged or renewed. If the work is completed successfully this will also provide the opportunity to hire the freelancer on a permanent contract, having already proved their abilities on the job. Earlier this year, one of our e-commerce startup clients hired a freelancer on a permanent basis, as both parties had enjoyed the arrangement so much. The possibility of a freelancer becoming permanent means that the investment which has gone into them, financially and temporally, is rarely wasted.

Myth 3: Freelancers are just a stop-gap

As outlined above, freelancers can be used effectively as a stop-gap. However, freelancers shouldn’t be seen only as a last resort. Traditional consultants typically start as generalists and are thus rarely experts in anything until they’ve progressed through the ranks. In freelancing, this is not the case. Freelancers need to develop an industry or functional expertise to be able to “sell themselves”. As such, especially in the tech and e-commerce word, we are seeing an increasing number of freelancers who are experts and bought into businesses as such. Recently, a small theatre and television company, hired a freelance strategy analyst through us to analyze their business model. Their hire was able to bring the strategic consulting mind to the company they had been missing, and his previous knowledge of projects the theatre/media industry, and specific expertise allowed him to offer insights that a traditional consultant, or a permanent employee, wouldn’t be able to provide.

Myth 4: They won’t develop the same passion for the company 

While it’s true that a freelancer won’t have time to develop the team spirit and passion for the company that a permanent hire would, this certainly doesn’t result in a lower standard of work. A freelancer’s business is based on their reputation so, even more than a permanent employee who has a certain degree of job security, a freelancer must always perform their best work so that their reputation can flourish. It’s also worth noting that since freelancers are able to choose their projects, they’ll choose projects which they’re excited by and will be able to inject a certain amount of fresh energy and passion into the current team.

In conclusion

It’s clear from our experience that start-ups are having a lot of success in hiring freelancers for a whole variety of purposes. We would, therefore, highly recommend at least considering a freelancer when you’re considering your next hire. They aren’t always the right option, but can certainly offer benefits which permanent employees are not able to provide.

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