Making the move from permanent employee to freelance consultant

Are you thinking of becoming a freelance consultant? The transition from permanent to freelance can seem a little daunting and unclear, and just as there are big differences in the work style of the two roles, the process to the first freelance assignment also is very different from that of the traditional job. Here are a few tips on how to ensure an optimal transition to the freelance life.

Choose between two paths

First, be sure to leave your current workplace in a proper and fair manner, as it is very important to maintain a good reputation in an industry where a lot depends on the quality of your network. Your current employer could become your future client!

There are two paths that can lead to your freelance future. You can choose to take the safe way, stay in your permanent position, and try and plan your resignation with the acquisition of your first freelance assignment. This way you have more financial security during the transition phase, however, you are also less flexible. Potential clients must be willing to wait until you are free of any commitments, which in a fast-paced market is not something they necessarily are inclined to do.

Alternatively, there is the fast way, which requires you to take the leap starting with the termination of your current permanent job while making sure you inform your consultancy partner of when you are available for any potential assignments. This way, you can get your first assignment faster and you will be more flexible in terms of starting up. However, be patient it could take some time before you land your first freelance job. This path is therefore associated with a higher degree of financial uncertainty and risk that you must be able to tolerate.

Get an understanding of the market

Before making the transition from permanent employee to freelance consultant, you should familiarize yourself with the dynamics and ‘unwritten rules’ of the market for freelance IT consultants. There is a lot to be aware of. Here are just a few examples:

Know that there is a big difference in the process of hiring for a permanent position in comparison to freelance. Once you are considered for a freelance assignment, things move very quickly. It is a more aggressive process with only one interview, and the expectation is generally that the candidate is able to start with a week’s notice. Essentially, you need to be ready for an interview on Wednesday, to receive an answer Friday, and to start Monday the week after. It is a much faster hiring process.

In this regard, be aware that the importance of soft values is lower in the context of freelance, the focus of the client interview is centered heavily on whether you can solve the task at hand. Unlike the permanent position, all the soft values about who you are, what you appreciate and like to do etc. are less relevant. Most often you have 30 minutes to sell yourself in the interview with the client. You must be capable of delivering results from day one, as there is not the same possibility to learn on the job contrary to the permanent position.

In short, there are many different requirements to freelance consultants, which you need to be aware of and comfortable with. Do your research before making the transition.

Find a good business partner

Research the market for consultancy companies. There is a big difference in what they offer and what they can do for you. Book a lot of coffee meetings. Reach out to relevant consultancies so they can get acquainted with you and get you considered for as many assignments as possible. Make sure you have some good references, e.g., on your LinkedIn profile, so it is apparent that you have a done good job in the places you have worked previously.

It takes a lot to do everything yourself. A consultancy can help you get the right assignments and match you with the right clients, so you can focus on what you’re best at – solving the task at hand and providing value for the client.

Note that the most prestigious and attractive assignments usually only are available through a consultancy, since the largest companies make use of framework agreements for external consultants. Furthermore, be aware that freelance consultants follow the terms of payment of the client. Those are 90 days in general. One of the benefits of being a consultant at ProData Consult, for example, is that our consultants always receive payment after 30 days, effectively allowing for a more stable income pattern.

Be up front and honest

The clients know the process and are well aware that consultants may be considered for several jobs at a time, whether it is for freelance or for permanent positions. Be open about your situation and what you want, and make it clear to your consultancy partner. This also applies if you are being considered for different jobs, be it freelance or permanent employment. It allows the consulting firm to position you correctly for the client and gives the client the best experience of you as a candidate, and you avoid making yourself unpopular with potential future clients. Making promises you cannot keep in the interest of having as many options as possible is a bad long-term strategy as a freelance consultant!

Get the practical things sorted

Freelance contracts are entered into with companies or firms rather than individuals. Therefore, you are required to have a business license in the form of a CVR number and also a business insurance in order to work as a freelance consultant. If you are new as a freelancer, then it could be be a good idea to hire an accountant, since there are many tax rules and economic conditions that you must be on top of when having your own business. And when your focus lies solely with the client, the benefit of having someone take care of your practical setup, is peace of mind.

Most never look back

Although the idea of abandoning the comfort of a permanent position can be a little nerve-wracking, and the notion of going solo as a freelance consultant, at first can seem a little overwhelming, most IT specialists stay freelancing once they have taken the leap. They realize, they have a lot to offer, and find new meaning in the more impactful way their skills and competences are measured. In fact, very few choose to go back to permanent employment after having worked as freelance consultants.

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