Freelancers don’t operate in the same financial context as traditional small businesses do, but that doesn’t mean we don’t need resources and tools to help our business grow just like everybody else. While traditional financial institutions scramble to figure out how to stay relevant as we undergo a seismic shift in the way people work and make money, innovative financial technology companies are making it possible for freelancers like you and me to have what we need for success. A freelancer is, unequivocally, an entrepreneur. Self-made. Our products and services are the talents and passions we strive to make our careers. We want the work to drive the business, not the other way around. The time has come to change the perception of the freelancer and legitimize the freelancer business- in order to do this, freelancers need access to business resources, like working capital.
Working capital is important for any business, to be sure, but there are unique avenues that a freelancer can approach to invest in their business. For businesses, working capital is utilized to finance the costs of day-to-day operations (overhead, SG&A, etc.). For freelancers, working capital is often more personal. As you are working on gigs and seeking new ones, working capital provides stability to the income roller coaster and allows freelancers to fully realize the many advantages of this lifestyle. Let’s take a look at some of the ways working capital can change the game.
Investing in the Growth of Your Business
- Outsourcing– if you are a designer, then design. Your time is money- get access to capital in order to bring on others for other tasks associated to a gig. With some working capital, you can build a team around you that will allow you to be more efficient, focusing on what you do best and delivering a quality product to your client.
- Technology– In today’s digital environment, investing in new hardware, software, or online accounts, can make life easier and gigs more profitable. For example, buying new WordPress plugins, getting the new Photoshop, webinars, LinkedIn accounts, web hosting, etc. At the end of the day, a small investment in technology to deliver a better product is a great ROI.
- Education and Networking– “I’m not a businessman, I’m a business, man.” You are your greatest asset. Investing in the development of your skills via workshops, seminars, trainings, etc., or making an effort to get out to conferences or events to learn and meet people.
- Professional membership– These may seem old-school, but for freelancers, networking is extremely important. Take a look at professional groups in your line of work and consider making these connections. The networking effect of contacts and referrals can mean waves of new clients.
- Creative marketing– This is a very important one- ROI. Unless you are a guru in your space, getting noticed by the right people can be the biggest challenge for a talented freelancer looking to get gigs. Long term, this is how you build your brand and increase the value of your gigs. Furthermore, if you’re not a marketing specialist by trade, marketing yourself can be difficult. Again, the idea is to focus on what you do best.
Maximize the Freelancer Lifestyle
- Income Stability– For a freelancer, business and personal finances are often one in the same. This can add unnecessary stress to our freelancer lifestyle. Working capital loans can help to stabilize your operation through the peaks and valleys of day-to-day operations.
- Bridging Gaps Between Invoices and Payments– For “companies”, factoring is a common practice. Freelancers, though, could stand to benefit arguably more than traditional businesses. Again, financial systems haven’t yet figured out the future of our workforce, but access to freelancer working capital is a good solution.
- Be More Selective with Your Gigs– This one is huge. Taking on any old prospect because you really need to get paid this month is not the spot you want to be in. It’s not what being a freelancer is about. It can also lead to you getting taken advantage of. By having some capital to carry your business, you can pick the best gigs, with clients you want to work with, and ultimately, ones that will lead to you making more money.
- Growth Capital– Having trouble marketing yourself? Want to design a website showcasing your abilities but lack the extra cash to get it going? Need a new camera? A new app? Whatever the case may be, sometimes you have to invest a little bit in order to change your operate for the better. This is Business 101, and it is no different for freelancers. With additional resources, tools, and visibility, where could you take it?
Now, these are just ideas (albeit good ones if I say so myself), but this list is not meant to be comprehensive. The point is, as freelancers, we need to understand that the freelance career has evolved, and there are tools and resources at our disposal to legitimize our business. If we take control of our operation, we really can get the freedom and comfort we want, making money doing the work we enjoy.